What is worse in real estate than a market where buyers feel prices are too high and don't raise their bids and sellers think prices are not high enough and are not willing to negotiate? Gridlock markets are possibly the most frustrating for agents.....and the consumer.
In the past few years in numerous areas around the country negatively impacted by the SALT tax deduction limitation, many homeowners were simply unable to sell their large home with high real estate tax bills. The devaluation that happened by this gridlock - mostly in some suburbs - was astounding. It also put lives and planning on hold. New COVID-related demand re-awakened and unlocked these stagnant and de-valuing markets, a combination of new interest in larger homes outside of large cities as well as pricing that had become super-attractive....and much lower than three years before when the valuation decline began. There is one upside to gridlock: With far fewer actions/transactions, no clear pricing trends register. Unfortunately, the few transactions that do happen can often register large price declines and sway averages, something that drives valuation perceptions. This too can create demand. Like all gridlock moments, sooner or later they end too and after a period of gridlock, a wave of activity can be unleashed, mostly via perceived value.
Gridlock is frustrating for everyone: buyers, sellers, and agents. A free-flowing market with a healthy balance between buyer and seller expectations is the best kind, but very rare. So is gridlock good? I don't think so. Holding up people's lives is never a good thing in my humble opinion. Unfortunately, these gridlock markets do and will continue to happen....and then like all markets they too will unlock.
DID YOU KNOW? Weekly Gallup polls in the U.S. found 91% of respondents said they had worn a mask in the past 7 days in September, compared with 80% in May. In France, which is experiencing a MASSIVE Covid surge, 72% of people said they were avoiding gatherings and face-to-face meetings as of mid-May, right after the country’s lockdown ended. But by Sept. 23rd, that figure had fallen to 32%. In the same time frame, the percentage who said they greeted others without shaking hands or embracing fell from 88% to 69%. Covid-discipline-fatigue is real and is causing massive new case spikes and deaths in the US and Europe. This is a marathon, not a sprint: please remain disciplined about keeping distance, wear masks, keep rooms well ventilated and wash hands. (WSJ)
DID YOU KNOW? According to a survey commissioned by optical retailer Vision Direct, people’s average daily screen time has ballooned to more than 19 hours a day when accounting for viewing multiple devices at once (you know who you are). If this pace continues, a newborn with an average life expectancy will spend nearly 58 years bathed in the glow of laptops, smartphones, televisions and whatever screens 2048 brings. Want to know where the consumers' eyes are: now you know..... (WSJ)
DID YOU KNOW? Zoom use jumped from 10 million a day in December 2019 to more than 300 million a day by late March. (WSJ)
DID YOU KNOW? American households watched 4 billion more hours of television in 2020 versus 2019.
DID YOU KNOW? Disruption is not a new thing at all..... This past weekend in 1861 Western Union completed the first transcontinental telegraph line across the US, making nearly instantaneous cross-country communication possible for the first time. Previously, it took 10 days for a letter to be sent from Missouri to California via the Pony Express.....two days later the Pony Express shut down operations.
Once the kids have left the nest, you may be wondering what to do with all of the extra space in your home. Chances are, you don’t need four bedrooms anymore, and it may be a great time to sell your house and downsize, maybe even into a single-story home. You’ve likely gained significant equity if you’ve lived in your home for a while, so making a move while demand for your current house is high could be your best step forward toward the retirement goals you set out to achieve several years ago.
The dilemma, though, is where to go next. A big concern for many homeowners who are ready to sell is finding a home to move into, given today’s lack of houses available for sale. There is, however, some good news: the number of single-family 1-story homes being built today is on the rise, improving your odds of finding the right home for your changing needs. In a recent article, The National Association of Home Builders (NAHB) explains:
“Nationwide, the share of new homes with two or more stories fell from 53% in 2018 to 52% in 2019, while the share of new homes with one story grew from 47% to 48%.”
What are the benefits of buying a one-story home?
Still not sure about buying a single-story home? An article from Home Talk covers several advantages of switching from two floors to one:
1. Energy Efficient
“It is easier to heat and cool a single-story house [than] it would be to regulate the temperatures of a multi-story house.”
Most single-story homes only need one heating or cooling unit, and they typically stay cooler than a two-story home, both of which can lead to significant savings.
2. Easier to Maintain
“Doing a general cleaning in a single story requires less effort and you will be able to see all areas that need cleaning and the areas are easily accessible.”
Cleaning and maintenance of a single-story home can take less time and effort, and better upkeep helps improve the overall value of the home.
3. Accessible for Everyone
“A single-story house can be accessed by anyone, whether they are young children or the senior citizens.”
If you’re looking for a house that provides a safe and easily accessible environment at any age, a single-story home may be optimal.
4. Good Resell Potential
“When buying a single-story house, you should consider the resale value should you think of reselling it in case of a circumstance that can happen. Look at the growth rate of that area. Due to the high demand of these types of houses it is [easy] to resell them and depending on the growth rate of an area, it increases in value significantly.”
Single-story homes have a lot of benefits and are often in higher demand. This bodes well for future resale opportunities.
There are many benefits to downsizing into a one-story home. Doing so while demand for your current house is high might make it easier than ever to make a move. Let’s connect if you’re ready to purchase the single-story home you need while homes are so affordable today.
Buying a home is likely one of the largest investments many of us will make in our lifetime. After
years of saving, planning, and budgeting, you may feel prepared and even excited to begin your
first home-buying process. However, with the outbreak of COVID-19 and the overwhelming
effect that it has had on economies across the world, the real estate market has been inevitably
impacted as well. That said, you may be wondering how this will affect your home purchase.
Unexpectedly, while several industries have been declining from the pandemic, the real estate
industry has managed to stay afloat and in some cases, grow during the pandemic. So the
question is; as a buyer, what benefits will you gain from purchasing your home now?
As you may have already found out, house hunting in large cities and popular suburban areas is
not always a walk in the park because of the intense competition that many homebuyers face.
Finding your ‘perfect’ home may have been more of a dream than reality after comparing prices
and battling offers with other prospective buyers. However, the outbreak of COVID-19 has
actually driven less competition within the market in certain areas.
Consumer Reports recommends thinking outside of the box when it comes to your house search
locations. In some cases, you are able to find the gem that matches your needs in a location
where you weren’t expecting to look initially. These areas often drive less competition because
so many homebuyers are naturally feeling uncertainty from the pandemic, so they are less likely
to take a risk when buying a home and expand outside of their range of comfort.
In a general sense, social distancing mandates and limited travel have caused many to
postpone their house hunt, making it one of the best times to jump in.
Virtual and Online Capabilities
Many prospective buyers have even postponed their house search because of the assumption
that they will not be able to tour houses or do walk-through inspections. As we know, this limited
in-person contact is to ensure the safety of everyone. However, it shouldn’t be a reason to stop
the search. There are many technology-based options that work to make the buying process as
comfortable as possible even during a pandemic.
The housing market overall had already begun its transition to technology-based services in
recent years and tech has become a necessity for the survival of the market this year. Home
buying transactions like mortgage preapprovals, loan financing, and closing on a home can all
be conducted through digital lenders and virtual services. Even if you already own a home,
refinancing with no-closing-cost can be achieved more efficiently through digital lenders.
Especially with the industry being forced into virtual services, digital lenders are more likely to
introduce automation into their processes to provide more efficiency. Automation systems like
robotic process automation (RPA) help to make significant operational improvements in lending
which in return, produces fast, quality processing for you as a buyer.
Lower Interest Rates & Housing Prices
One of the most attractive parts of the real estate market currently is the low-interest rates on
mortgages. In the early part of this year, interest rates actually dropped below 3% for the first
time in 50 years. While these rates are expected to fluctuate in the coming months, it can still be
a good idea to take advantage of them while they are here.
However, while the interest rates are decreasing, housing prices are still rising. Instinctively,
most of us see this as a deterrent from buying a home. However, before making that
assumption it’s recommended to conduct more research on the trends of the market. Why? With
less competition, some might argue that the market prices will increase in the coming months as
quarantine mandates are lifted and a vaccine is publicly distributed. Prospective buyers who
postponed their house hunt will rejoin the market, causing a greater demand and inevitably
higher market prices. So before completely shying away from purchasing your home during the
pandemic, be sure to keep an eye on the market and how prices are changing over time to be
sure you are making effective financial decisions.
Navigating such a challenging yet rewarding stage of life through a pandemic can take an
immense amount of strategy and patience. Be sure to keep in mind these benefits of continuing
your search through the pandemic and take advantage of them where you can. By investing
time and research into these tips, you can leverage the best components of your local housing
market during such an uncertain time.
Today, Americans are moving for a variety of different reasons. The current health crisis has truly re-shaped our lifestyles and our needs. Spending extra time where we currently live is enabling many families to re-evaluate what homeownership means and what they find most important in a home.
According to Zillow:
“In 2020, homes went from the place people returned to after work, school, hitting the gym or vacationing, to the place where families do all of the above. For those who now spend the majority of their hours at home, there’s a growing wish list of what they’d change about their homes, if possible.”
With a new perspective on homeownership, here are some of the top reasons people are reconsidering where they live and making moves this year.
1. Working from Home
Remote work is becoming the new norm in 2020, and it’s continuing on longer than most initially expected. Many in the workforce today are discovering they don’t need to live close to the office anymore, and they can get more for their money if they move a little further outside the city limits. Lawrence Yun, Chief Economist for the National Association of Realtors (NAR) notes:
“With the sizable shift in remote work, current homeowners are looking for larger homes and this will lead to a secondary level of demand even into 2021.”
If you’ve tried to convert your guest room or your dining room into a home office with minimal success, it may be time to find a larger home. The reality is, your current house may not be optimally designed for this kind of space, making remote work and continued productivity very challenging.
2. Virtual Schooling
With school about to restart this fall, many districts are beginning the new academic year online. Education Week is tracking the reopening plans of schools across the country, and as of August 21, 21 of the 25 largest school districts are choosing remote learning as their back-to-school instructional model, affecting over 4.5 million students.
With a need for a dedicated learning space, it may be time to find a larger home to provide your children with the same kind of quiet room to focus on their schoolwork, just like you likely need for your office work.
3. A Home Gym
Staying healthy and active is a top priority for many Americans. With various levels of concern around the safety of returning to health clubs across the country, dreams of space for a home gym are growing stronger. The Home Builders Association of Greater New Orleans explains:
“For many in quarantine, a significant decrease in activity is more than a vanity issue – it’s a mental health issue.”
Having room to maintain a healthy lifestyle at home – mentally and physically – may prompt you to consider a new place to live that includes space for at-home workouts.
4. Outdoor Space
Especially for those living in an apartment or a small townhouse, this is a new priority for many as well. Zillow also notes the benefits of being able to use yard space throughout the year:
“People want more space in their next home, and one way to get it is by turning part of the backyard into a functional room, ‘an outdoor space for play as well as entertaining or cooking.’”
You may, however, not have the extra square footage today to have these designated areas – indoor or out.
Moving May Be Your Best Option
If you’re clamoring for extra space to accommodate your family’s changing needs, making a move may be your best bet, especially while you can take advantage of today’s low mortgage rates. Low rates are making homes more affordable than they have been in years. According to Black Knight:
“Buying power for those shopping for a home is up 10% year over year, with home buyers able to afford nearly $32,000 more home than they could have 1 year ago while keeping their monthly payment the same.”
It’s a great time to get more home for your money, just when you need the extra space.
People are moving for a variety of different reasons today, and many families’ needs have changed throughout the year. If you’ve been trying to decide if now is the time to buy a new home, let’s connect to discuss your needs.
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