We should be thanking the pandemic ONLY for the housing Euphoria that we have been in as a nation. Being sparked by historically low interest rates, the housing boom was accelerated by a combination of record low inventory and the influx of city-dwellers who wanted to move to more rural areas.
This year has been the HOTTEST year for the real estate market since 2007. The median sale price in metro areas has risen into double-digit percentages compared to prices from just a year ago. With the pandemic still among us, many sellers have been putting the brakes on when it comes to listing their home. The totality of houses on the market is currently at half the number that it was a year ago.
With such little inventory on the market, which is expected to continue, housing offers are being accepted on homes in under two weeks of being listed. Are you considering selling your home?
The reports are in
The emerging problem at hand is that single-family housing inventory remains extremely low. With rising interest rates, it’s starting to become harder for buyers to afford a home. Although demand for single family homes remains solid, the improving economy is still allowing for house prices to grow. For the first time the ultra-low inventory has caused a highly competitive market where buyers are submitting offers well over the listing price. The familiar term has been arising through the world of media known as “bidding wars”.
Predictions
The early indications show that homebuyer demands could get progressively smaller as the housing market soon becomes unaffordable. With the current low mortgage rates and tight supply, there will still be risk at hand for a “housing mania” similarly seen in the mid-2000’s. The good news is that mania does not last forever and the housing boom is starting to develop red flags as the bond traders start pricing in rate hikes.
If you are considering selling your home, contact us today. You need a competitive pre-approval letter to help leverage an upcoming purchase.