Real Estate Market Updates

  It’s economy 101 – when supply is low and demand is high, prices naturally rise. That’s what’s happening in today’s housing market. Home  prices are appreciating  at near-historic rates, and that’s creating some challenges when it comes to  home appraisals . In recent months, it’s become increasingly common for an appraisal to come in below the contract price on the house. Shawn Telford, Chief Appraiser for  CoreLogic , explains it like this: “ Recently, we observed buyers paying prices above listing price and higher than the market data available to appraisers can support.  This difference is known as ‘the appraisal gap . . . . ’” Why does an appraisal gap happen? Basically, with the heightened buyer demand, purchasers are often willing to pay over asking to secure the home of their dreams. If you’ve ever toured a house you’ve fallen in love with, you understand. Once you start to picture yourself and your furniture in the rooms, you want to do everything you can to land the propert

Becoming financially secure is an important goal for many people today, but some don’t realize just how much  homeownership  can help them achieve that dream. A recent report,  The Journey Toward Financial Freedom ,  surveys Americans about their perspective on financial wellness and their goals. It shows there may be a significant misconception about the role owning a home plays in building wealth: “Home ownership is one of the indicators Americans say is  least connected to financial health ." Two major personal wealth goals – homeownership and net worth – work hand-in-hand. Below are just a few reasons why, if you’re looking for financial security, homeownership should be a top priority. Homeownership Is an Important Cornerstone of Building Wealth Every three years, the  Federal Reserve  releases the  Survey of Consumer Finances  which highlights the difference in wealth between homeowners and renters. The graph below shows the findings across the previous surveys including the

  Some Highlights When it comes to  selling  your house, you want it to look its best inside and out. It’s important to focus on tasks that can make it inviting, show it’s cared for, and boost your curb appeal for  prospective buyers . Let’s  connect  to make sure your house shows well and catches a buyer’s eye.

  There are many  non-financial benefits  of buying your own home. However, today’s headlines seem to be focusing primarily on the financial aspects of homeownership – specifically affordability. Many articles are making the claim that it’s not affordable to buy a home in today’s market, but that isn’t the case. Today’s buyers are spending approximately  20% of their income  on their monthly mortgage payments. According to  The Essential Guide to Creating a Homebuying Budget  from  Freddie Mac , the 20% of income that purchasers are currently paying is well within the 28% guideline suggested: “Most lenders agree that  you should spend no more than 28% of your gross monthly income on a mortgage payment  (including principal, interest, taxes and insurance).” So why is there so much talk about challenges regarding affordability? It’s Not That Homes Are Unaffordable – It’s That They’re Less Affordable. Since home prices are rising, it’s true that homes are less affordable than they have be

  If you’re trying to decide whether or not to  sell your house , this is the time to think seriously about making a move.  Fannie  Mae’s  recent  Home Purchase Sentiment Index  (HPSI) reveals the number of respondents who say it’s a good time to sell is higher now than it was over the past few summers ( see graph below ).  Today, the majority of consumers, 75 percent, say it’s a good time to  sell a house . Why is sellers sentiment up year-over-year? The higher good time to sell sentiment has to do with today’s  market conditions , specifically low housing supply and high buyer demand. In the simplest terms, we don’t have enough houses available for sale to meet buyer demand. According to  the latest data  from the  National Association of Realtors  (NAR), we’re still firmly in a  sellers’ market  because housing supply is well below a balanced norm ( shown in the graph below). Clearly, the scales are tipped in a seller’s favor today. But while  housing supply  is undeniably low, the

  As summer comes to a close, is it time to think about selling your vacation home? Based on recent data and expert opinions, it’s something you may want to consider. According to  research  from the  National Association of Realtors  (NAR),  vacation home sales are up 57.2% year-over-year for January-April 2021. If you’ve taken your last vacation this summer, here are reasons you should consider selling your vacation home this year. 1. Remote work continues to drive demand for vacation homes. As the report from NAR says, based on continuously evolving work needs, there could be more interest in your  second home  than you think: “In 2020, across all nine divisions, the fraction of the workforce that work from home is  typically higher in the vacation home counties than in the non-vacation home counties … The opportunity to work from home could  further raise the demand for vacation homes in future years. Recent data shows we’ll likely see a sustained increase in the rate of  remote wo

  Mortgage rates are hovering near record lows, and that’s good news for today’s homebuyers. The  graph  below shows mortgage rates dating back to 2016 and where today falls by comparison. Generally speaking, when rates are low, you can afford more home for your money. That’s why experts across the industry agree – today’s low rates present buyers with an  incredible opportunity . Here’s what they have to say: Sam Khater, Chief Economist at  Freddie Mac ,  points out  the historic nature of today’s rates: “As the economy works to get back to its pre-pandemic self, and the fight against COVID-19 variants unfolds,  owners and buyers continue to benefit from some of the lowest mortgage rates of all-time .” Mark Fleming, Chief Economist at  First American ,  talks about  how rates impact a buyer’s bottom line: “Mortgage rates are generally the same across the country, so a decline in mortgage rates  boosts affordability equally in each market .” Danielle Hale, Chief Economist at  realtor.c

  In the current sellers’ market, many homeowners wonder what, if anything, needs to be remodeled before they list their house. That’s where a trusted real estate professional comes in. They can help you think through today’s market conditions and how they impact what you should – and shouldn’t – renovate before selling. Here are some considerations a professional will guide you through: 1. With current supply challenges, buyers may be willing to take on projects of their own. A more balanced market typically sees a 6-month supply of homes for sale. Above that, and we’re in a buyers’ market. Below that, and we’re in a  sellers’ market . According to a recent  report  by the  National Association of Realtors  (NAR), our current supply of homes for sale, while rising, still remains solidly in sellers’ market territory: “ Unsold inventory sits at a 2.6-month supply at the current sales pace , modestly up from May's 2.5-month supply but down from 3.9 months in June 2020 .” So, what’s t

  There are many headlines about how housing affordability is declining. The headlines are correct: it’s less affordable to purchase a home today than it was a year ago. However, it’s important to give this trend context. Is it less expensive to buy a house today than it was in 2005? What about 1995? What happens if we go all the way back to 1985? Or even 1975? Obviously, the price of a home has appreciated dramatically over the last 45 years. So have the prices of milk, bread, and just about every other consumable.  Prices rise over time  – we know it as  inflation . However, when we look at housing,  price  is just one component that makes up the monthly  cost  of the home. Another key factor is the mortgage rate at the time of purchase. Let’s look back at the  cost  of a home over the last five decades and adjust it for inflation by converting that cost to 2021 dollars. Here’s the methodology for each data point of the table below: Mortgage Amount : Take the median sales price at th

Home prices continue to rise as we move through the summer, and that’s good news for   sellers   who are looking to maximize their home’s potential. If you’re on the fence about whether to list your house now or later, the question you should really ask is: will this price appreciation last? Here’s what three leading industry experts have to say about what lies ahead: Lawrence Yun,  Chief Economist,  National Association of Realtors  (NAR): “At a broad level,  home prices are in no danger of a decline  due to tight inventory conditions,  but I do expect   prices to appreciate at a slower pace by the end of the year .” Selma Hepp , Deputy Chief Economist,  CoreLogic : “The imbalance between robust demand and dismal availability of for-sale homes has led to a continual bidding over asking prices, which reached record levels in recent months . . . . Nevertheless, with more new listings and new home construction,  home price acceleration that has built momentum, and continues to reach new