Traditionally, spring is the busiest season for real estate. Buyers come out in force and homeowners list their
houses for sale hoping to capitalize on buyer activity. This year will be no different!
Buyers have already been out in force looking for their dream homes and more are on their way, but the challenge is
that the inventory of homes for sale has not kept up with demand, which has lead to A LOT of competition for the
homes that are available.
A recent Bloomberg article touched on the current market
“It’s the 2017 U.S. spring home-selling season, and listings are scarcer than they’ve ever been. Bidding wars
common in perennially hot markets like the San Francisco Bay area, Denver and Boston are now also prevalent in
the once slow-and-steady heartland, sending prices higher and sparking desperation among buyers across the
Sam Khater, Deputy Chief Economist at CoreLogic went
on to explain why buyers are flocking to the market in big numbers:
“In today’s market, many buyers think the trough in [interest] rates is over. If you don’t get in now, it’s
just going to be worse later. Rates will be higher, prices will be higher, and maybe inventory selection will be
In some markets, “thirty-five percent of properties are selling
within the first week or two of hitting the market.” Homes
are selling at a rapid clip in places like:
- Denver, CO
- Seattle, WA
- Oakland, CA
- Grand Rapids, MI
- Boise, ID
- Madison, WI
- Omaha, NE
Let’s get together to discuss your exact market conditions and help you create a strategy to secure your new home
in this competitive atmosphere!
There are many benefits to homeownership. One of the top benefits is being able to protect yourself from rising
rents by locking in your housing cost for the life of your mortgage.
Don’t Become Trapped
Jonathan Smoke, Chief Economist at realtor.com, reported on what he calls a “Rental Affordability Crisis.” He warns
“Low rental vacancies and a lack of new rental construction are pushing up rents, and we expect that they’ll
outpace home price appreciation in the year ahead.”
In the Joint Center for Housing Studies at Harvard University’s 2016 State of the Nation’s
Housing Report, they revealed that “The number of cost-burdened households rose to 21.3 million. Even more troubling, the number
with severe burdens (paying more than 50% of
income for housing) jumped to a record 11.4 million.”These households
struggle to save for a rainy day and pay other bills, such as food and healthcare.
It’s Cheaper to Buy Than Rent
In Smoke’s article, he went on to say,
“Housing is central to the health and well-being of our country and our local communities. In addition, this
(rental affordability) crisis threatens the future value of owned housing, as the burdensome level of rents will
trap more aspiring owners into a vicious financial cycle in which they cannot save and build a solid credit
record to eventually buy a home.”
“While more than 85% of markets have burdensome rents today, it’s perplexing that in more than 75% of the
counties across the country, it is actually cheaper to buy than rent a home. So why aren’t those unhappy renters
choosing to buy?”
Know Your Options
Perhaps you have already saved enough to buy your first home. HousingWire reportedthat analysts at Nomura believe:
“It’s not that Millennials and other potential homebuyers aren’t qualified in terms of their credit scores or
in how much they have saved for their down payment.
It’s that they think they’re not qualified or they
think that they don’t have a big enough down payment.” (emphasis added)
Many first-time homebuyers who believe that they need a large down payment may be holding
themselves back from their dream home. As we have reported before, in many areas of the country, a first-time home buyer can save for a 3% down payment
in less than two years. You may have already saved enough!
Don’t get caught in the trap so many renters are currently in. If you are ready and willing to buy a home, find out
if you are able. Let’s get together to determine if you can qualify for a mortgage now!