Home Prices Still Growing – Just at a More Normal Pace
Home Prices Still Growing – Just at a More Normal Pace If you’re feeling a bit muddy about home prices, that’s no surprise. Some people still say prices are falling, even though data proves otherwise. Part of that misconception is that people get their information from unreliable sources. But it’s also coming from some media coverage misrepresenting the data. So, to keep things simple, here’s what you need to know using accurate data you can trust. Normal Home Price Seasonality Explained In the housing market, predictable ebbs and flows happen each year. It’s called seasonality. Spring is the peak homebuying season when the market is most active. That activity is typically intense in the summer but begins to wane as the more relaxed 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 that you can see the seasonality): As the data shows, home prices grow at the beginning of the year but not as much as when entering the spring and summer markets. 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 increase significantly more. 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, dark bars are a 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 typical for the market. That’s good 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 fall. So don’t believe everything you see in the headlines. The data included here gives you the context to understand what’s happening. So, if you see something confusing in the headlines, 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 progresses. And that 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 good. If you have questions about what’s happening with prices in our local area, let’s connect.
Are There Actually More Homes for Sale Right Now?
Are There Actually More Homes for Sale Right Now? If you're looking to move, you want to be sure you have the latest information on the housing market. To help make that possible, here's an update on today's supply of homes for sale. Whether you're looking to buy or sell, the number of homes available in your local market matters to you. Take a look below. What's the Truth About Today's Housing Inventory? While the story for the past few years has been how few homes are on the market, recent national data may leave you feeling a bit confused. That's because Realtor.com shows inventory is growing a bit month-over-month in many parts of the country (see the blue states in the map below): The map shows that the housing supply increased by just over 5% nationally last month. Does That Mean the Days of Limited Inventory Are Over? That might make you wonder: are the days of tight housing supply behind us? The short answer is no. Context is important. While you may see headlines saying inventory is up, data also shows there are still significantly fewer homes for sale than there would usually be in a more normal market. The graph below compares the latest active listing counts (homes currently available for sale) with the most recent average years in the housing market (2017-2019): As Lance Lambert, Founder of ResiClub Analytics, explains: “Housing market inventory is so far below pre-pandemic levels that October's big jump is still just a drop in the bucket.” What does that mean for you? Remember, real estate is hyper-local. Partnering with a trusted real estate agent will help you better understand the inventory situation in your specific market. If you're looking to buy, you may have slightly more options than in recent months, but you still need to brace for low inventory. A great agent will be able to share their expertise and critical strategies that have helped other buyers navigate today's ongoing low housing supply. And, if you're trying to sell, rest assured you haven't missed your window of opportunity to get multiple offers or potentially see your house sell quickly. While inventory has ticked up some nationally, overall, it's still low and may be down even more in your area. Bottom Line If you're looking to buy or sell a home, let's connect to ensure you're up to date on all the latest trends that could impact your move, including today's housing supply.
Is Your House the Top Thing on a Buyer’s Wish List this Holiday Season?
Is Your House the Top Thing on a Buyer's Wish List this Holiday Season? This time every year, homeowners planning to move have a decision to 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 slightly lately, overall inventory is still lower than 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 crave 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 schedule, which can be especially important during this busy time of year. Plus, buyers may be 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. 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 house 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 Plenty of good reasons exist 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.
What Are Accessory Dwelling Units and How Can They Benefit You?
What Are Accessory Dwelling Units, and How Can They Benefit You? Maybe you're in the market for a home and have difficulty finding the right one that fits your budget. Or perhaps you're already a homeowner needing extra income or a place for loved ones. Whether as a potential homebuyer or a homeowner with changing needs, accessory dwelling units, or ADUs for short, we may be able to help you reach your goals. What Is an ADU? As AARP says: “An ADU is a small residence that shares a single-family lot with a larger, primary dwelling.” “An ADU is an independent, self-contained living space with a kitchen or kitchenette, bathroom and sleeping area.” “An ADU can be located within, attached to, or detached from the main residence. It can be created out of an existing structure (such as a garage) or built anew.” If you're considering whether an ADU makes sense for you as a buyer or a homeowner, here's some helpful information and benefits that ADUs can provide. Remember that regulations for ADUs vary based on where you live, so lean on a local real estate professional for more information. The Benefits of ADUs Freddie Mac and the AARP identify some of the best features of ADUs for both buyers and homeowners: Living Close by, But Still Separate: ADUs allow loved ones to live together in separate spaces. That means you can enjoy each other's company and help with things like childcare while having privacy when needed. If this appeals to you, you may consider buying a home with an ADU or adding an ADU to your house. According to Freddie Mac: “Having an accessory dwelling unit on an existing property has become a popular way for homeowners to offer independent living space to family members.” Aging in Place: Similarly, ADUs allow older people to be close to loved ones who can help them if they need it as they age. It gives them the best of both worlds – independence and support from loved ones. For example, if your parents are getting older and you want them nearby, you may want to buy a home with an ADU or build one onto your existing house. Affordable To Build: Since ADUs are often on the smaller side, they're typically less expensive to build than larger, standalone homes. Making one can also increase your property's value. Generating Additional Income: If you own a home with an ADU or if you build an ADU on your land, it can help generate rental income you could use toward your mortgage payments. It's worth noting that because an ADU exists on a single-family lot as a secondary dwelling, it typically cannot be sold separately from the primary residence. But that's changing in some states. Work with a professional to understand your options. These are a few reasons why many people benefit from ADUs and think they're a good idea. As Scott Wild, SVP of Consulting at John Burns Research, says: “It’s gone from a small niche in the market to really a much more impactful part of new housing.” Bottom Line ADUs have some significant advantages for buyers and homeowners alike. If you're interested, contact a real estate professional who can help you understand local codes and regulations for this type of housing and what's available in your market.
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