Hey guys, let’s have a look at the most recent developments to hit the real estate market this month!
First off, from last February to this one, property sales prices are up by a whopping 20%! We are also down 48% when it comes to inventory year over year. Our closed sales are down by 12%, as our inventory levels are so low that despite enough buyer demand there just aren’t enough properties to go around. This month we’ve only had around 880 new homes hit the market, at a time when we need at least 2,000-3,000 new listings to arrive. What’s worse is that we’ve seen only 1,300 homes sold, keeping inventory levels down.
What’s happening outside of low inventory?
Interest rates have unfortunately gone up substantially. This was a long time coming and needed to happen to slow down the market a bit. Rates are likely to come down after a while but for now we’re looking at a 4% rate for a 30-year fixed mortgage.
It’s a tough time for buyers right now with a lot of competition around, increased interest rates, etc. One of our biggest real estate analysts in the business, Zillow, predicted that home values will go up 16% this year alone. One of the biggest reasons for this is likely due to very low inventory. With increased interest rates, we’re likely to see less homeowners going out to buy a new home. Perhaps they’re still enjoying the low interest rate on their existing home, even if they can afford their next purchase, thereby keeping inventory levels down. We don’t have much new development happening either, furthering the issue. I’d suggest you speak to your mortgage lender, and run the figures to get a sense of how the updated interest rate will affect your future purchases.
Look into options to purchase your next home before selling your existing one. We’ve got some phenomenal offers waiting for you. And what about investors looking to buy but are nervous about the 1031 exchange? Come in and have a chat with us where we can guide you around reversing that and being able to unlock the existing equity in your property without having to wait to close the sale.
If you ever have any questions at all, please reach out to us!
- If you are thinking about buying or selling we would love to help!
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