People Are Still Moving, Even with Today’s Affordability Challenges If you're thinking about buying or selling a home, you might have heard that it’s tough right now because mortgage rates are higher than they’ve been over the past few years, and home prices are rising. That much is true. Take a look at the graph below. It breaks down how the current affordability situation stacks up to recent years. The National Association of Realtors (NAR) explains how to read the values on the graph: “To interpret the indices, a value of 100 means that a family with the median income has exactly enough income to qualify for a mortgage on a median-priced home.” The black dotted line represents that 100 value on the index. Essentially, the higher the bar, the more affordable homes are. As you can see, the orange bar for today shows higher mortgage rates and home prices have created a clear challenge. But, while affordability is definitely tighter right now, that doesn’t mean the housing market is at a standstill. According to NAR, based on the pace of sales right now, just under 4 million homes will sell this year. With some simple math, let’s break down what that really means for you: 3.96 million homes divided by 365 days in a year = 10,849 houses sell each day 10,849 divided by 24 hours in a day = 452 houses sell per hour 452 divided by 60 minutes in an hour = about 8 houses sell each minute So, on average, over 10,000 homes sell each day in this country. Whether you're a buyer or a seller, this goes to show there are still ways to make your move possible, even at a time when affordability is tight. An Agent Can Help You Make Your Move a Reality You may be wondering how other homebuyers and sellers are making this happen now. One of the biggest game-changers in today’s market is working with a trusted local real estate agent. Great agents are helping other people just like you navigate today’s market and the current affordability situation, and their insight is invaluable right now. True professionals will be able to offer advice tailored to your specific wants, needs, budget, and more. Not to mention, they’ll also be able to draw on their experience of what’s working for other buyers and sellers right now. This could mean broadening your search, if needed, to include other housing types like condos, townhouses, or neighborhoods a bit further out to help offset some of the affordability challenges today. Bottom Line You might think there aren’t many people buying or selling homes right now since affordability is tighter than it’s been in quite some time, but that’s not the case. It’s true that buying a home has become more expensive over the past couple of years, but people are still moving. If you’re hoping to buy or sell a home today, know that other people are still making their goals a reality – and that’s happening in large part because of the help and advice of skilled local real estate agents. Want to talk to a trusted professional about your own move? Let’s connect.
Continuing Reading2024 Housing Market Forecast [INFOGRAPHIC] Some Highlights Thinking of buying or selling a house and wondering what the new year holds for the housing market? Experts forecast home prices to end this year up 2.8% and to rise another 1.5% in 2024. And climbing prices help make homeownership a good investment. Plus, home sales are projected to increase in 2024. That’s good news because it means experts are forecasting more activity as people continue to move. If you're planning to buy or sell, it’s helpful to know what experts project for the housing market. Let’s connect to talk about the latest forecasts and craft a plan together.
Continuing ReadingIs Your House the Top Thing on a Buyer’s Wish List this Holiday Season? This time every year, homeowners who are planning to move have a decision to make: sell now or wait until after the holidays? Some sellers with homes already on the market may even remove their listing until the new year. But the truth is, many buyers want to purchase a home for the holidays, and your house might be just what they’re looking for. As an article from Fortune Builders explains: “ . . . while a majority of people take a step back from the real estate market during the holiday months, you may find when the temperature drops, your potential for a great real estate deal starts to rise.” To help prove that point, here are four reasons you shouldn’t wait to sell your house. 1. The desire to own a home doesn’t stop during the holidays. While a few buyers might opt to delay their moving plans until January, others may need to move now because something in their life has changed. The buyers who look for homes at this time of year are usually motivated to make their move happen and are eager to buy. A recent article from Investopedia says: “Anyone shopping for a new home between Thanksgiving and New Year’s is likely going to be a serious buyer. Putting your home on the market at this time of year and attracting a serious buyer can often result in a quicker sale.” 2. While the supply of homes for sale has increased a little bit lately, overall inventory is still lower than it was before the pandemic. What does that mean for you? If you work with an agent to price your house at market value, it could still sell quickly because today’s buyers are craving more options – and your home may be exactly what they’re searching for. 3. You can determine the days and times that are most convenient for you for home showings. That can help you minimize disruptions to your own schedule, which can be especially important during this busy time of year. Plus, you may find buyers are more flexible on when they’ll tour a house this time of year because they have more time off from work around the holidays. 4. And finally, homes decorated for the holidays appeal to many buyers. For those buyers, it’s easy to picture gathering with their loved ones in the home and making memories of their own. An article on selling at this time of year offers this advice: “If you’re selling around a holiday and have decorations up, make sure they accent—not overpower—a room. Less is more.” Bottom Line There are plenty of good reasons to put your house on the market during the holiday season. Let's chat and see if it's the right time for you to sell.
Continuing ReadingHome Prices Still Growing – Just at a More Normal Pace If you’re feeling a bit muddy on what’s happening with home prices, that’s no surprise. Some people are still saying prices are falling, even though data proves otherwise. Part of that misconception is because people are getting their information from unreliable sources. But it’s also coming from some media coverage misrepresenting what the data really shows. So, to keep things simple, here’s what you really need to know using real data you can trust. Normal Home Price Seasonality Explained In the housing market, there are predictable ebbs and flows that happen each year. It’s called seasonality. Spring is the peak homebuying season when the market is most active. That activity is typically still strong in the summer but begins to wane as the cooler months approach. Home prices follow along with seasonality because prices appreciate most when something is in high demand. That’s why there’s a reliable long-term home price trend. The graph below uses
Continuing ReadingHome Prices Still Growing – Just at a More Normal Pace If you’re feeling a bit muddy on what’s happening with home prices, that’s no surprise. Some people are still saying prices are falling, even though data proves otherwise. Part of that misconception is because people are getting their information from unreliable sources. But it’s also coming from some media coverage misrepresenting what the data really shows. So, to keep things simple, here’s what you really need to know using real data you can trust. Normal Home Price Seasonality Explained In the housing market, there are predictable ebbs and flows that happen each year. It’s called seasonality. Spring is the peak homebuying season when the market is most active. That activity is typically still strong in the summer but begins to wane as the cooler months approach. Home prices follow along with seasonality because prices appreciate most when something is in high demand. That’s why there’s a reliable long-term home price trend. The graph below uses data from Case-Shiller to show the typical percent change for monthly home price movement from 1973 through 2022 (not adjusted, so you can see the seasonality): As the data shows, at the beginning of the year, home prices grow, but not as much as they do when entering the spring and summer markets. That’s because the market is less active in January and February since fewer people move in the cooler months. As the market transitions into the peak homebuying season in the spring, activity ramps up, and home prices go up a lot more in response. Then, as fall and winter approach, prices still grow, just at a slower pace as activity eases again. This Year, Seasonality Has Returned Now, let’s look at how this year compares to that long-term trend (see graph below): Here’s the latest data for this year from that same source. Just like before, the dark bars are the long-standing trend. The green bars represent what’s happened this year. As you can see, the green bars are beginning to fall in line with what’s normal for the market. That’s a good thing because it’s more sustainable price growth than we’ve seen in recent years. In a nutshell, nationally prices aren’t falling, it’s just that price growth is beginning to normalize. Moving forward, there’s a chance the media will misrepresent this slowing of home price growth as prices falling. So don’t believe everything you see in the headlines. The data included here gives you the context you need to really understand what’s happening. So, if you see something in the headlines that’s confusing, don’t just take it at face value. Ask a trusted real estate professional for more information. Remember, it’s normal to see home price growth slow down as the year goes on. And that definitely doesn’t mean home prices are falling. They’re just rising at a more moderate pace. Bottom Line Home price appreciation is returning to normal seasonality and that’s a good thing. If you have questions about what’s happening with prices in our local area, let’s connect.
Continuing ReadingWhy Homeowners Are Thankful They Own Countless people have set out on the exciting journey of homeownership. Ask around and you’ll find the vast majority are thankful they took the leap and bought a home. But why? It’s because of the many emotional and lifestyle benefits that come with being a homeowner. So, if you’re trying to decide if you want to rent or buy a home, here are just a few of the many benefits you could look forward to if you buy. It’s a Safe Haven Owning a home goes beyond just having a roof over your head. It provides a sense of security and safety. In fact, in a survey from Fannie Mae, respondents say “having a sense of privacy and security” is one of the top reasons homeownership is preferred to renting. And in a different Fannie Mae survey, “living in a place where you and your family feels safe” is another one of the top benefits of homeownership. Your home is a place where you can truly relax and unwind. Knowing that you have a sanctuary to return to at the end of the day is a great source of comfort. It’s a Canvas for Self-Expression For many homeowners, their home is a reflection of who they are. The National Association of Realtors (NAR), says: “The home is yours. You can decorate any way you want and choose the types of upgrades and new amenities that appeal to your lifestyle.” From the color of the front door to the art hanging on the walls, every detail contributes to a unique expression of personal style. Put simply, owning a home gives you the freedom to make changes and improvements that resonate with your personality. It Helps You Feel More Connected to the Community Stability is another cornerstone of homeownership. The longer you stay put, the more emotionally connected you are to your community. For example, if your neighborhood does cook-outs, block parties, or other events, you’ll feel more engaged and probably build meaningful relationships with those around you. As NAR states: “Remaining in one neighborhood for several years allows you and your family time to build long-lasting relationships within the community.” The sense of community where you can make life-long friends helps give you more stability and predictability than you’d have if you move each time a rental lease renews. Its Where Lifelong Memories Are Made Not to mention, your home is where you’ll make many memories. It’s a backdrop for the stories of your life. Celebrating milestones, hosting gatherings, and building a treasure trove of special moments within the walls of your home is a heartwarming experience to be thankful for. Bottom Line As you start thinking about buying a home, remember why so many people are glad they did. Homeownership isn’t just a financial decision. It’s about having a stable place where you can make lasting memories. If you're thinking of buying a home and want advice, let's chat.
Continuing ReadingWhy Homeowners Feel Thankful for Their Homes [INFOGRAPHIC] Some Highlights Here are three reasons why homeowners feel thankful for their homes. First, it’s a safe place that can give you a greater sense of comfort, safety, and security. Second, it gives you freedom of expression. From the color of the paint to the art on the walls, you can express your style and your personality. Third, it provides a sense of community. Owning your home helps you build lasting friendships with neighbors and connects you to your community. If you're thinking of buying a home and want to hear more about the potential benefits, let's talk.
Continuing ReadingIs Wall Street Buying Up All the Homes in America? If you’re thinking about buying a home, you may find yourself interested in the latest real estate headlines so you can have a pulse on all of the things that could impact your decision. If that’s the case, you’ve probably heard mention of investors, and wondered how they’re impacting the housing market right now. That could leave you asking yourself questions like: How many homes do investors own? Are institutional investors, like large Wall Street Firms, really buying up so many homes that the average person can’t find one? To answer those questions, here’s the real story of what’s happening based on the data. Let’s start with establishing how many single-family homes (SFHs) there are and what portion of those are rentals owned by investors. According to SFR Investor, which studies the single-family rental market in the United States, there are eighty-two million single-family homes in this country. But how many of them are actually rentals? According to data shared in a recent post, sixty-eight million (82.93%) of those homes are owner-occupied – meaning the person who owns the home lives in it. If you subtract that sixty-eight million from the total number of single-family homes (82 million), that leaves just about fourteen million homes left that are single-family rentals (SFRs). Do institutional investors own all of those remaining fourteen million homes? Not even close. Let’s take it one step further. There are four categories of investors: The mom & pop investor who owns between 1-9 SFRs The regional investor who owns between 10-99 SFRs Smaller national investor who owns between 100-999 SFRs The institutional investor who owns over 1,000 SFRs These categories show that not all investors are large institutional investors. To help convey that even more clearly, here are the percentages of rental homes owned by each type of investor (see chart below): As you can see in the chart, despite what the news and social media would have you believe, the green shows the vast majority are not owned by large institutional investors. Instead, most are owned by small mom & pop investors, like your friends and neighbors. What’s actually happening is, that there are people out there, just like you, who believe in homeownership, and they view buying a home (or a second home) as an investment. Maybe they saw an opportunity to buy a second home over the last few years to use it as a rental and generate additional income. Or maybe they just decided to keep their first house rather than sell it when they moved up. So, don’t believe everything you read or hear about institutional investors. They aren’t buying up all the homes and making it impossible for the average person to buy. That’s just not what the numbers show. Institutional investors are actually the smallest piece of the pie chart. Bottom Line While it’s true that institutional investors are a player in the single-family rental marketplace, they’re not buying up all of the houses on the market. If you have other questions about things you’re hearing about the housing market, let’s connect so you have an expert to give you the context you need.
Continuing ReadingAre The Top 3 Housing Market Questions on Your Mind? When it comes to what’s happening in the housing market, there’s a lot of confusion going around right now. You may hear one thing in conversation with your friends, see something totally different on the news, and read something on social media that contradicts both of those thoughts. And, if you’re thinking about making a move, that can leave you with a lot of lingering questions. That’s where a trusted local real estate agent comes in. Here are the top 3 questions people are asking about today’s housing market, and the data to help answer them. 1. What’s Next for Mortgage Rates? Mortgage rates are higher than they’ve been in recent years. And, if you’re looking to buy a home, that impacts how much you can afford. That’s why so many buyers want to know what’s ahead for mortgage rates. The answer to that question is: no one can say for certain, but here’s what we know based on historical trends. There’s a long-standing relationship between mortgage rates and inflation. Basically, when inflation is high, mortgage rates tend to follow suit. Over the past year, inflation was up, so mortgage rates were as well. But inflation is easing now. And this is why the Federal Reserve has recently paused their federal funds rate hikes, which means many experts believe mortgage rates will begin to come down. And in some ways, we’ve started to see hints of slightly lower mortgage rates in recent weeks. But it’s certainly been volatile and will likely continue to be that way going into next year. Some ongoing variation is to be expected, but the anticipation is, that in 2024, we’ll see a downward trend. As Aziz Sunderji, Strategist at Home Economics, says: “The bottom line is that interest rates are likely to be lower-perhaps even lower than many optimists think - in the weeks and months to come.” 2. Where Are Home Prices Headed? While there’s been a lot of concern prices would come crashing down this year, data shows that didn’t happen. In fact, home prices are rising in most of the nation. Experts say that trend will continue, just at a slower pace that’s much more normal for the housing market – and that’s a good thing. To help show just how confident experts are in this continued appreciation, take a look at the Home Price Expectation Survey from Pulsenomics. It’s a survey of a national panel of over 100 economists, real estate experts, and investment and market strategists. As the graph below shows, the consensus is, that prices will keep climbing next year, and in the years to come. 3. Is a Recession Around the Corner? While recession talk has been a common thing over the past few years, there’s good news on that front. The Wall Street Journal (WSJ) polls experts on this topic regularly. And last year at this time, most of them thought a recession would have happened by now. But as experts look at all the leading indicators today, they’re changing their minds and saying a recession is getting less and less likely. The latest results show that more experts now think we’re not headed for another recession (see chart below): This is big news for the housing market. And while the 48% to 52% split may seem close to half and half, the key thing to focus on is that the majority of these experts think we’ve avoided a recession already. Bottom Line The big takeaway? The data shows there isn’t cause for concern – there are actually more signs of hope. Let’s connect to talk more about the housing market questions on your mind as we head into the new year.
Continuing ReadingHow VA Loans Can Help Make Homeownership Dreams Come True For more than 79 years, Veterans Affairs (VA) home loans have helped millions of veterans buy their own homes. If you or someone you care about has served in the military, it's essential to learn about this program and its advantages. Here are some important things to know about VA loans before you buy a home. The Many Advantages of VA Home Loans VA home loans provide a pathway to homeownership for those who have served our nation, and they’re a great benefit for buyers who qualify. According to the Department of Veteran Affairs: Options for No Down Payment: Qualified borrowers can often purchase a home with no down payment. That’s a huge weight lifted when you’re trying to save for a home. Limited Closing Costs: There are limits on the types of closing costs you pay when you qualify for a VA home loan. So, more money stays in your pocket when it’s time to seal the deal. Don’t Require Private Mortgage Insurance (PMI): Many other loans with down payments under 20% require PMI. VA loans do not, which means veterans can save on their monthly housing costs. A recent article from Veterans United sums up just how impactful this loan option can be: “For the vast majority of military borrowers, VA loans represent the most powerful lending program on the market. These flexible, $0-down payment mortgages have helped more than 24 million service members become homeowners since 1944.” Bottom Line Owning a home is the American Dream. Veterans sacrifice a lot to protect our country, and one way we can show our appreciation is by making sure they know all the benefits of VA home loans. Thank you for your service.
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