Portland Area Real Estate BlogRecently posted or modified blog posts by tag - New Constructionhttps://www.portlandareaproperties.com/blog/Copyright PortlandAreaProperties.com2024-02-05T14:21:57-07:00tag:portlandareaproperties.com,2012-09-20:10722Portland Area Home Sales | Why Having Your Own Agent Matters When Buying a New Construction Home<img src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240201/20240205-Why-Having-Your-Own-Agent-Matters-When-Buying-a-New-Construction-Home.png" width="600" style="font-size: 17px;" />
Finding the right home is one of the biggest <a href="https://www.portlandareaproperties.com/blog/explaining-todays-low-housing-supply-infographic" target="_blank">challenges</a> for potential <a href="https://www.portlandareaproperties.com/blog/3-keys-to-hitting-your-homeownership-goals-in-2024" target="_blank">buyers</a> today. Right now, the supply of homes for sale is still low. But there is a bright spot. <a href="https://www.portlandareaproperties.com/blog/why-you-may-want-to-seriously-consider-a-newly-built-home" target="_blank">Newly built homes</a> make up a larger percent of the total homes available for sale than normal. That’s why, if you’re craving more options, it makes sense to see if a newly built home is right for you.
But it’s important to remember the process of working with a builder is different than buying from a homeowner. And, while builders typically have sales agents on-site, having your <a href="https://portlandareaproperties.com/blog/a-real-estate-agent-helps-take-the-fear-out-of-the-market" target="_blank">own agent</a> helps make sure you have proper representation throughout your <a href="https://portlandareaproperties.com/blog/your-homebuying-adventure-infographic" target="_blank">homebuying journey</a>. As Realtor.com <a href="https://www.realtor.com/guides/guide-to-buying-new-construction-home/steps-to-buying-a-new-construction-house/" rel="noopener noreferrer" target="_blank">says</a>:
“Keep in mind that the on-site agent you meet at a new-construction office works for the builder. So, as the homebuyer, it’s a smart idea to bring in your own agent, as well, to help you negotiate and stay protected in the transaction.”
Here’s how having your own agent is key when you build or <a href="https://www.portlandareaproperties.com/blog/achieving-your-homebuying-dreams-in-2024-infographic" target="_blank">buy</a> a new construction home.
Agents Know the Local Area and Market
It’s important to consider how the neighborhood and surrounding area may evolve before making your home purchase. Your agent is well-versed in the upcoming communities and developments that could influence your decision. One way a real estate agent can help is by reviewing the builder's site plan. For example, you’ll want to know if there are any plans to construct a highway or add a drainage ditch behind your prospective backyard.
Knowledge of Construction Quality and Builder Reputation
An agent also has expertise in the construction quality and reputation of different builders. They can give you insights into each one's track record, customer satisfaction, and construction practices. Armed with this information, you can choose a builder known for consistently delivering top-notch homes.
Assistance with Customization and Upgrades
The most obvious benefit of opting for new home construction is the opportunity to customize your home. Your agent will guide you through that process and share advice on the upgrades that are most likely to add long-term value to your home. Their expertise helps make sure you focus your budget on areas that will give you the greatest return on your investment later.
Understanding Builder Negotiations and Contracts
When it comes to working with builders, having a skilled negotiator on your side can make all the difference. Builder contracts can be complex. Your agent can help you navigate these contracts to make sure you fully understand the terms and conditions. Plus, agents are skilled negotiators who can advocate for you, potentially securing better deals, upgrades, or incentives throughout the process. As Realtor.com <a href="https://www.realtor.com/guides/guide-to-buying-new-construction-home/steps-to-buying-a-new-construction-house/" rel="noopener noreferrer" target="_blank">says</a>:
“A good buyer’s agent will be able to review any contracts before you sign on the dotted line, ensuring you aren’t unwittingly agreeing to terms that only benefit the builder.”
Bottom Line
If you are interested in <a href="https://portlandareaproperties.com/blog/key-terms-every-homebuyer-should-learn-infographic" target="_blank">buying</a> or building a new construction home, having a trusted agent by your side can make a big difference. If you'd like to start that conversation, let’s connect.
Source: https://www.simplifyingthemarket.com/en/2024/02/05/why-having-your-own-agent-matters-when-buying-a-new-construction-home?a=365763-dcb30e2e7daccff551cc8d8ee31934af 2024-02-05T09:00:00-07:002024-02-05T14:21:57-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:10622Portland Area Home Sales | Why You May Want To Consider a Newly Built Home Today2024-01-19T09:00:00-07:002024-01-19T09:59:59-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:10064Portland Area Home Sales | Explaining Today’s Low Housing Supply [INFOGRAPHIC]<img src="https://files.keepingcurrentmatters.com/content/images/20230928/Explaining-Todays-Low-Housing-Supply-KCM-Share.png" width="600" style="font-size: 17px;" />
<a href="https://www.simplifyingthemarket.com/en/content/images/20230928/Explaining-Todays-Low-Housing-Supply-MEM.png?a=365763-dcb30e2e7daccff551cc8d8ee31934af" rel="noopener noreferrer" target="_blank"><img src="https://files.keepingcurrentmatters.com/content/images/20230928/Explaining-Todays-Low-Housing-Supply-MEM.png" /></a>
Some Highlights
Wondering why the supply of <a href="https://www.portlandareaproperties.com/blog/why-is-housing-inventory-so-low" target="_blank">homes for sale</a> is limited <a href="https://www.portlandareaproperties.com/blog/get-ready-for-smaller-more-affordable-homes/" target="_blank">today</a>? There are a few factors at play.
Lack of <a href="http://www.census.gov/construction/nrc/xls/co_cust.xls" rel="noopener noreferrer" target="_blank">building</a> over time, the <a href="https://portlandareaproperties.com/blog/mortgage-rates-past-present-and-possible-future" target="_blank">mortgage rate</a> lock-in <a href="https://www.fhfa.gov/DataTools/Downloads/Pages/National-Mortgage-Database-Aggregate-Data.aspx" rel="noopener noreferrer" target="_blank">effect</a>, and people <a href="https://www.nar.realtor/research-and-statistics/research-reports/highlights-from-the-profile-of-home-buyers-and-sellers" rel="noopener noreferrer" target="_blank">staying</a> in their houses longer are three of the main reasons why supply is low.
But real estate agents know exactly <a href="https://www.portlandareaproperties.com/blog/remote-work-is-changing-how-some-buyers-search-for-their-dream-homes" target="_blank">where to look</a> and what to do to make your dream a reality. Let’s connect so you have an expert on your side to help you successfully navigate the market and find your next home.
Source: https://www.simplifyingthemarket.com/en/2023/09/29/explaining-todays-low-housing-supply-infographic?a=365763-dcb30e2e7daccff551cc8d8ee31934af 2023-09-29T08:00:00-07:002023-09-29T08:32:07-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:9976Portland Area Home Sales | Why Is Housing Inventory So Low?<img src="https://files.keepingcurrentmatters.com/content/images/20230911/20230914-Why-Is-Housing--Inventory-So-Low.png" width="600" style="font-size: 17px;" />
One question that’s top of mind if you’re thinking about <a href="https://www.portlandareaproperties.com/blog/where-are-people-moving-today-and-why" target="_blank">making a move</a> today is: Why is it so hard to find a house to buy? And while it may be tempting to wait it out until you have <a href="http://portlandareaproperties.com/blog/todays-housing-market-has-only-half-the-usual-inventory-infographic" target="_blank">more options</a>, that’s probably not the best strategy. Here’s why.
There aren’t enough homes available for sale, but that <a href="https://www.portlandareaproperties.com/portlandareaproperties.com/blog/theres-only-half-the-inventory-of-a-normal-housing-market-today" target="_blank">shortage</a> isn’t just a today problem. It’s been a challenge for years. Let’s take a look at some of the long-term and short-term factors that have contributed to this limited supply.
Underbuilding Is a Long-Standing Problem
One of the big reasons inventory is low is because builders haven’t been <a href="http://portlandareaproperties.com/blog/the-value-of-an-agent-when-buying-your-new-construction-home" target="_blank">building</a> enough homes in recent years. The graph below <a href="http://www.census.gov/construction/nrc/xls/co_cust.xls" rel="noopener noreferrer" target="_blank">shows</a> new construction for single-family homes over the past five decades, including the long-term average for housing units completed:<a href="https://www.simplifyingthemarket.com/en/content/images/20230911/20230914-Single-Family-Housing-Units-Completed.png?a=365763-dcb30e2e7daccff551cc8d8ee31934af" rel="noopener noreferrer" target="_blank"><img src="https://files.keepingcurrentmatters.com/content/images/20230911/20230914-Single-Family-Housing-Units-Completed.png" /></a>
For 14 straight years, builders didn’t construct enough homes to meet the historical average (shown in red). That underbuilding created a significant inventory deficit. And while <a href="https://www.portlandareaproperties.com/portlandareaproperties.com/blog/people-want-less-expensive-homes-and-builders-are-responding" target="_blank">new home construction</a> is back on track and meeting the historical average right now, the long-term inventory problem isn’t going to be solved overnight.
Today’s Mortgage Rates Create a Lock-In Effect
There are also a few factors at play in today’s market adding to the inventory challenge. The first is the mortgage rate <a href="https://www.portlandareaproperties.com/blog/sellers-dont-let-these-two-things-hold-you-back/" target="_blank">lock-in effect</a>. Basically, some homeowners are reluctant to sell because of where <a href="https://portlandareaproperties.com/blog/how-inflation-affects-mortgage-rates" target="_blank">mortgage rates</a> are right now. They don’t want to move and take on a rate that’s higher than the one they have on their current home. The chart below helps <a href="https://www.fhfa.gov/DataTools/Downloads/Pages/National-Mortgage-Database-Aggregate-Data.aspx" rel="noopener noreferrer" target="_blank">illustrate</a> just how many homeowners may find themselves in this situation:<a href="https://www.simplifyingthemarket.com/en/content/images/20230911/20230914-70.7-percent-of-mortgage-rates-less-than-4.png?a=365763-dcb30e2e7daccff551cc8d8ee31934af" rel="noopener noreferrer" target="_blank"><img src="https://files.keepingcurrentmatters.com/content/images/20230911/20230914-70.7-percent-of-mortgage-rates-less-than-4.png" /></a>
Those homeowners need to remember <a href="https://portlandareaproperties.com/blog/why-you-may-still-want-to-sell-your-house-after-all" target="_blank">their needs</a> may matter just as much as the financial aspects of their move.
Misinformation in the Media Is Creating Unnecessary Fear
Another thing that’s limiting inventory right now is the fear that’s been created by the media. You’ve likely seen the negative headlines calling for a housing crash, or the ones saying home prices would fall by 20%. While neither of those things happened, the stories may have dinged your confidence enough for you to think it’s better to hold off and wait for things to calm down. As Jason Lewris, Co-Founder and Chief Data Officer at Parcl, <a href="https://www.parcllabs.com/articles/q3-real-estate" rel="noopener noreferrer" target="_blank">says</a>:
“In the absence of trustworthy, up-to-date information, real estate decisions are increasingly being driven by fear, uncertainty, and doubt.”
That’s further limiting inventory because people who would make a move otherwise now feel hesitant to do so. But the market isn’t doom and gloom, even if the headlines are. An agent can help you separate <a href="https://portlandareaproperties.com/blog/why-you-need-a-true-expert-in-todays-housing-market" target="_blank">fact from fiction</a>.
How This Impacts You
If you’re wondering how today’s low inventory affects you, it depends on if you’re selling or buying a home, or both.
For <a href="https://portlandareaproperties.com/blog/how-to-know-if-youre-ready-to-buy-a-home" target="_blank">buyers</a>: A limited number of homes for sale means you’ll want to seriously consider all of your options, including various areas and housing types. A skilled professional will help you explore all of what’s available and find the home that best fits your needs. They can even coach you through casting a broader net if you need to expand your search.
For <a href="https://portlandareaproperties.com/blog/buyer-traffic-is-still-stronger-than-the-norm" target="_blank">sellers</a>: Today’s low inventory actually offers incredible benefits because your house will stand out. A real estate agent can walk you through why it’s especially worthwhile to sell with these conditions. And since many sellers are also buyers, that agent is also an essential resource to help you stay up to date on the latest homes available for sale in your area so you can find your next dream home.
Bottom Line
The low supply of homes for sale isn’t a new challenge. There are a number of long-term and short-term factors leading to the current inventory deficit. If you’re looking to make a move, let’s connect. That way you’ll have an expert on your side to explain how this impacts you and what’s happening with housing inventory in our area.
Source: https://www.simplifyingthemarket.com/en/2023/09/14/why-is-housing-inventory-so-low?a=365763-dcb30e2e7daccff551cc8d8ee31934af 2023-09-14T08:00:00-07:002023-09-14T10:01:31-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:9656Portland Area Home Sales | Momentum Is Building for New Home Construction<img src="https://files.keepingcurrentmatters.com/content/images/20230707/20230707-momentum-is-building-for-new-home-construction.jpg" width="600" style="font-size: 17px;" />
If you’re in the process of looking for a home today, you know the <a href="https://www.portlandareaproperties.com/blog/todays-housing-inventory-is-a-sweet-spot-for-sellers" target="_blank">supply of homes</a> for sale is low because you’re feeling the impact of having a limited pool of options. And, if your biggest hurdle right now is that you’re having trouble finding something you like, don’t forget that a newly built home is a great option.
As a recent article from the National Association of Realtors (NAR) <a href="https://www.nar.realtor/magazine/real-estate-news/contract-signings-slow-but-buyer-demand-is-still-high" rel="noopener noreferrer" target="_blank">says</a>:
“Home buyers continue to be met with limited housing options during what’s typically the real estate market’s busiest season. . . . The current supply of existing homes is about half the level it was in 2019 . . . Meanwhile, the market for new construction is a bright spot.”
Here’s a look at a key metric that shows just how much new home construction is ramping up nationwide. It’s called new residential completions. Basically, completions are newly built homes that are finished and ready to move into.
The graph below uses <a href="https://www.census.gov/construction/nrc/current/index.html" rel="noopener noreferrer" target="_blank">data</a> from the Census to show the trend of new-home completions over time, including the long-term average for the number of finished housing units (shown in black on the graph):
<a href="https://www.simplifyingthemarket.com/en/content/images/20230707/20230711-new-residential-completions-increase.png?a=365763-dcb30e2e7daccff551cc8d8ee31934af" rel="noopener noreferrer" target="_blank"><img src="https://files.keepingcurrentmatters.com/content/images/20230707/20230711-new-residential-completions-increase.png" /></a>
As you can see on the left (shown in orange), leading up to the housing crash, builders exceeded that average. The result was an oversupply of homes on the market, so <a href="https://portlandareaproperties.com/blog/are-home-prices-going-up-or-down-that-depends" target="_blank">home values</a> declined. That was one of the factors that led to the housing crash back in 2008.
Since then, the level of new home construction has fallen off, and builders haven’t built enough homes to meet the historical average (shown in red). That underbuilding left the housing market with a multi-year inventory deficit. And, that deficit is part of what makes inventory so low right now.
But, here’s the good news. The green on the right shows that according to the <a href="https://www.census.gov/construction/nrc/current/index.html" rel="noopener noreferrer" target="_blank">latest report</a> from the Census, builders are matching the long-term average right now. And that means they’re bringing more newly built homes to the market than they have in recent memory.
And residential starts and permits are also gaining momentum. Starts are homes where the construction has officially kicked off. Permits are homes where builders are planning to break ground soon. Since both are up, it’s a sign there are even more newly built homes coming soon.
What This Means for You
More newly built homes in various stages of the construction process means your pool of options just got bigger. If you’re looking to move right now and timing is important to you, reach out to a local<a href="https://www.portlandareaproperties.com/blog/why-buyers-need-an-expert-agent-by-their-side" target="_blank"> real estate professional</a> to explore the homes that were recently completed in your area. If construction is done on those homes, you should be able to move in quickly.
But, if you can wait a bit and the idea of customizing a home from the ground up appeals to you, ask that same agent about the homes in your area that are in the process of being built. If you buy a home that’s still in the works, you can help pick the features and finishings along the way. And when none of the homes you’ve looked at so far are to your liking, being able to tailor one to your taste may be your best option.
Either way, a trusted real estate agent is a crucial part of the process. They’ll know exactly what’s available in your area and can base their recommendations on your unique needs, desired neighborhoods, and more.
Bottom Line
So, if you're having trouble finding a home you like while inventory is so low, it may be time to consider looking into new-home construction. If you'd like to start that conversation, let’s connect so you’re working with an expert on what’s available in our area.
Source: https://www.simplifyingthemarket.com/en/2023/07/11/momentum-is-building-for-new-home-construction?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2023-07-11T08:00:00-07:002023-07-11T09:42:18-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:9603Portland Area Home Sales | Where Will You Go If You Sell? Newly Built Homes Might Be the Answer.<img src="https://files.keepingcurrentmatters.com/content/images/20230627/20230629-where-will-you-go-if-you-sell-newly-built-homes-might-be-the-answer.jpg" width="600" style="font-size: 17px;" />
Do you want to <a href="https://www.portlandareaproperties.com/blog/why-buying-or-selling-a-home-helps-the-economy-and-your-community" target="_blank">sell</a> your house, but hesitate because you’re worried you won’t be able to find your next home in today’s market? You're not alone, but there’s some good news that may ease your worries. New home construction is up and is becoming an increasingly significant part of the housing inventory.
That means when you go to put your <a href="https://portlandareaproperties.com/blog/eco-friendly-energy-efficient-homes-attract-buyers" target="_blank">house</a> on the market this <a href="https://portlandareaproperties.com/blog/moving-now-can-give-your-house-its-day-in-the-sun-infographic" target="_blank">summer</a>, considering newly built homes is crucial for expanding the options you’ll have for your next move.
Near-Record Percentage of New Home Inventory
Newly built homes today make up a near-record percentage of the total number of homes available for sale (see graph below):
<a href="https://www.simplifyingthemarket.com/en/content/images/20230627/20230629-newly-built-homes-make-up-31-percent-of-total-inventory.png?a=365763-dcb30e2e7daccff551cc8d8ee31934af" rel="noopener noreferrer" target="_blank"><img src="https://files.keepingcurrentmatters.com/content/images/20230627/20230629-newly-built-homes-make-up-31-percent-of-total-inventory.png" /></a>
In fact, as the data shows, newly built homes now make up <a href="https://www.nar.realtor/research-and-statistics/housing-statistics/existing-home-sales" rel="noopener noreferrer" target="_blank">31%</a> of the total for-sale inventory. Over the past couple of decades, newly built homes made up an average of only around <a href="https://www.census.gov/housing/hvs/data/histtabs.html" rel="noopener noreferrer" target="_blank">13%</a> of total housing inventory from 1983 to 2019.
That means the percentage of the total available homes that are newly built is over two times higher than the norm.
Why This Matters to You
Overall, the supply of homes for sale is still low. And when there’s limited supply, it’s crucial to explore all of your available choices. New-home construction has emerged as a game changer with increasing inventory. Not to mention, recent <a href="https://www.census.gov/construction/nrc/current/index.html" rel="noopener noreferrer" target="_blank">data</a> shows it’s gaining even more momentum as more newly built homes are underway and will be coming to the market in the months ahead.
Robert Dietz, Chief Economist at the National Association of Home Builders (NAHB), highlights the importance of newly built homes for those looking to buy in today’s housing market. Dietz <a href="https://www.usatoday.com/story/money/2023/05/16/new-home-construction-silver-lining/70222917007/" rel="noopener noreferrer" target="_blank">states</a>:
"With limited available housing inventory, new construction will continue to be a significant part of prospective buyers' search in the quarters ahead."
Don’t overlook this growing market segment and risk missing out on great opportunities to find your ideal home. Since new home construction accounts for roughly 31% of total for sale inventory, you could be cutting nearly one in three options from your search if you don’t consider newly built homes.
If you’re looking to make a move, a local real estate agent can help you <a href="https://www.portlandareaproperties.com/blog/the-benefits-of-selling-now-according-to-experts" target="_blank">sell</a> your current house and explore newly built options in your area. They have the expertise you need to handle both sides of the process so you can move out of your current house and into your brand-new dream home.
Bottom Line
Now’s the time to <a href="https://portlandareaproperties.com/blog/your-needs-matter-more-than-todays-mortgage-rates" target="_blank">sell</a> your house and take advantage of the momentum that’s building in new home construction. Let’s connect so you have a guide throughout the selling and buying process. Together, we can make your transition to a newly built home a reality.
Source: https://www.simplifyingthemarket.com/en/2023/06/29/where-will-you-go-if-you-sell-newly-built-homes-might-be-the-answer?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2023-06-29T08:00:00-07:002023-06-29T11:15:54-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:9367Portland Area Home Sales | It May Be Time To Consider a Newly Built Home<img src="https://files.keepingcurrentmatters.com/content/images/20230505/20230508-it-may-be-time-to-consider-a-newly-built-home.jpg" width="600" style="font-size: 17px;" />
If you’re looking to <a href="https://www.portlandareaproperties.com/blog/trying-to-buy-a-home-hang-in-there" target="_blank">buy a house</a>, you may find today’s limited supply of homes available for sale challenging. When housing inventory is as low as it is right now, it can feel like a bit of an uphill battle to find the perfect home for you because there just isn’t that much to choose from. If you need to open up your pool of options, it may be time to consider a newly built home.
According to the <a href="https://www.census.gov/construction/nrc/pdf/newresconst.pdf" rel="noopener noreferrer" target="_blank">latest data</a> from the U.S. Census, there’s positive news when it comes to new home construction. When you look at the first three months of this year, you’ll find:
More new homes were completed and are ready to sell. This gives you more move-in-ready options for your search.
Builders broke ground and started construction on more single-family homes. This means there are more homes intended for one household in the beginning stages of construction, allowing you the opportunity to customize one to your liking.
The number of permits for building new single-family homes ticked up. This shows builders are ramping up to start on even more home construction soon.
And, while this is all good news for broadening your options for your home search, there are other perks that come with considering a newly built home.
Customization
When you buy a new home under construction, you can tailor it to your unique needs and taste. Bankrate <a href="https://www.bankrate.com/mortgages/build-or-buy-a-house/#building" rel="noopener noreferrer" target="_blank">says</a>:
“Building means customizing. . . . instead of wishing your home had a certain kind of flooring, a sunroom or some other special amenity, you’ll be able to tailor the property to your exact needs.”
Brand New Everything
Another perk of a new home is that nothing in the house is used. It’s all brand new and uniquely yours from day one.
Minimal Repairs
And, because everything is new, you’ll likely find there are fewer maintenance and repair needs up front. As Realtor.com <a href="https://www.realtor.com/advice/buy/purchasing-new-construction-for-first-time-homebuyers/" rel="noopener noreferrer" target="_blank">explains</a>:
“. . . if something does go wrong with your new home, not only are there likely some manufacturer warranties in place, but many builders also include additional home warranties . . .”
Energy Efficiency
Lastly, building a home gives you the opportunity to incorporate more <a href="https://portlandareaproperties.com/blog/why-you-may-want-an-energy-efficient-home-infographic" target="_blank">energy-efficient</a> options that can help lower your costs over time – which can feel especially important when inflation’s raising many of the costs around you.
Bottom Line
If you’re having trouble finding your dream home in today’s market, it may be time to consider newly built homes as an option. Let’s connect so you have an expert on your side to help you explore what’s available in our local area.
Source: https://www.simplifyingthemarket.com/en/2023/05/08/it-may-be-time-to-consider-a-newly-built-home?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2023-05-08T08:00:00-07:002023-05-08T09:18:37-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:8863Portland Area Home Sales | Should You Consider Buying a Newly Built Home?<img width="750" height="410" src="https://files.mykcm.com/2023/02/14110909/should-you-consider-buying-a-newly-built-home-KCM.jpg" class="attachment-entry size-entry wp-post-image" alt="Should You Consider Buying a Newly Built Home? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2023/02/14110909/should-you-consider-buying-a-newly-built-home-KCM.jpg 750w, https://files.mykcm.com/2023/02/14110909/should-you-consider-buying-a-newly-built-home-KCM-600x328.jpg 600w, https://files.mykcm.com/2023/02/14110909/should-you-consider-buying-a-newly-built-home-KCM-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" style="font-size: 17px;" />
If you’re thinking about buying a home, you might be focusing on previously owned ones. But with so few houses for sale <a href="https://www.portlandareaproperties.com/blog/why-todays-housing-market-isnt-headed-for-a-crash/" title="today" target="_blank">today</a>, it makes sense to consider all your options, and that includes a home that’s newly built.
The Number of Newly Built Homes Is on the Rise
While there are more houses for sale right now than there were at this time last year, there’s still a historically low number of <a href="https://portlandareaproperties.com/blog/number-of-homes-for-sale-up-from-last-year-but-below-pre-pandemic-years/" title="homes available" target="_blank">homes available</a> on the market. One reason for that is years of underbuilding—meaning there haven’t been enough new homes built to keep up with demand.
<a href="https://files.mykcm.com/2023/02/14110907/single-family-housing-units-completed-MEM.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-107444" src="https://files.mykcm.com/2023/02/14110907/single-family-housing-units-completed-MEM.png" /></a>
The graph above shows how low the production of newly constructed homes has been over the <a href="https://www.census.gov/construction/nrc/data/series.html" title="past 14 years" target="_blank" rel="noopener noreferrer">past 14 years</a>. But it also shows another important trend: the number of new homes being built each year is on the rise. As Mark Fleming, Chief Economist at First American, <a href="https://blog.firstam.com/economics/why-housing-market-potential-increased-for-the-second-straight-month" title="shares" target="_blank" rel="noopener noreferrer">shares</a>, that’s good news for buyers:
“While existing-home inventory remains limited, the silver lining for home buyers is that new-home inventory is on the rise, and a new home at the right price is a pretty good substitute.”
Builder Incentives Can Provide a Boost
While there a growing number of new homes for sale, builders are slowing that pace until they sell more of their current inventory. According to Logan Mohtashami, Lead Analyst at <a href="https://www.housingwire.com/articles/homebuilders-still-need-lower-mortgage-rates/" title="HousingWire" target="_blank" rel="noopener noreferrer">HousingWire</a>:
“The builders have to work off the backlog of homes, but instead of 3%-4% mortgage rates, they’re dealing with 6% plus mortgage rates, which means they have to provide many incentives to make sure those homes sell.”
Many builders are now offering incentives to help buyers purchase these homes. Fleming also explains:
“The National Association of Home Builders reported that nearly two-thirds of builders were offering incentives, including mortgage rate buydowns, paying points for buyers and price reductions, which could entice potential home buyers.”
A builder who’s willing to pay to reduce your mortgage rate could be a game changer. Ksenia Potapov, Economist at First American, <a href="https://blog.firstam.com/economics/why-mortgage-rates-hold-the-key-to-improved-affordability-in-2023" title="puts it" target="_blank" rel="noopener noreferrer">puts it</a> this way:
“A one percentage-point decline in mortgage rates has the same impact on affordability as an 11 percent decline in house prices.”
Should You Buy a Brand-New Home?
The best way to decide what type of home to buy is to work with a trusted real estate professional who can help you weigh the pros and cons of each option. They know which homes are available in your local market, and which builders might be offering incentives that make sense for you.
Bottom Line
Even though there aren’t a lot of homes for sale today, new home inventory is on the rise, and many builders are offering incentives. Let’s connect so I can help you weigh the pros and cons of shopping for a new home versus an existing one.
Source: https://www.simplifyingthemarket.com/en/2023/02/15/should-you-consider-buying-a-newly-built-home/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2023-02-15T09:00:00-07:002023-02-15T09:23:33-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:8752Portland Area Home Sales | Where Will You Go If You Sell? You Have Options.<img width="750" height="410" src="https://files.mykcm.com/2023/01/26201733/where-will-you-go-if-you-sell-you-have-options-KCM.jpg" class="attachment-entry size-entry wp-post-image" alt="Where Will You Go If You Sell? You Have Options. | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2023/01/26201733/where-will-you-go-if-you-sell-you-have-options-KCM.jpg 750w, https://files.mykcm.com/2023/01/26201733/where-will-you-go-if-you-sell-you-have-options-KCM-600x328.jpg 600w, https://files.mykcm.com/2023/01/26201733/where-will-you-go-if-you-sell-you-have-options-KCM-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" style="font-size: 17px;" />
There are plenty of good reasons you might be ready to move. No matter <a href="https://www.portlandareaproperties.com/blog/what-are-your-goals-in-the-housing-market-this-year/" title="your motivations" target="_blank">your motivations</a>, before you list your current house, you need to consider where you’ll go next.
In today’s <a href="https://portlandareaproperties.com/blog/ready-to-sell-todays-housing-supply-gives-you-two-opportunities/" title="market" target="_blank">market</a>, it makes sense to explore all your options. That includes both homes that have been lived in before as well as newly built ones. To help you decide which is right for you, let’s compare the benefits of each. Regardless of which option you choose to explore, working with a trusted real estate professional throughout the process is essential.
The Benefits of Newly Built Homes
First, let’s look at the benefits of purchasing a newly constructed home. With a brand-new house, you’ll be able to:
1. Build your dream home
If you build a home from the ground up, you’ll have the option to select the custom features you want, including appliances, finishes, landscaping, layout, and more. Bankrate puts it like <a href="https://www.bankrate.com/mortgages/build-or-buy-a-house/#building" title="this" target="_blank" rel="noopener noreferrer">this</a>:
“Building means customizing. . . . instead of wishing your home had a certain kind of flooring, a sunroom or some other special amenity, you’ll be able to tailor the property to your exact needs. You also won’t be limited to a specific location or neighborhood.”<br />
2. Take advantage of builder concessions
In today’s market, a lot of home builders are working hard to sell their current inventory before they add more to their mix. That means many of them are <a href="https://www.realtor.com/advice/buy/what-are-builder-incentives-deals-on-new-construction/" title="offering concessions" target="_blank" rel="noopener noreferrer">offering concessions</a> and are more willing to negotiate with buyers. That could work to your advantage in the process.
3. Minimize home repairs
Many builders offer a warranty, so you’ll have peace of mind on unlikely repairs. Plus, you won’t have as many little improvement projects to tackle. As realtor.com <a href="https://www.realtor.com/advice/buy/purchasing-new-construction-for-first-time-homebuyers/" title="says" target="_blank" rel="noopener noreferrer">says</a>:
“. . . if something goes wrong with your new home, not only are there likely some manufacturer warranties in place, but many builders also include additional home warranties . . .”
4. Take advantage of energy efficiency
When building a home, you can choose brand-new, energy-efficient options to help lower your utility costs, protect the environment, and reduce your carbon footprint.
The Benefits of Existing Homes
Now, let’s compare those to the perks that come with buying an existing home. With a pre-existing home, you can:
1. Explore a wider variety of home styles and floorplans
With decades of homes to choose from, you’ll have a broader range of floorplans and designs available.
2. Appreciate that lived-in charm
The character of older homes is hard to reproduce. If you value timeless craftsmanship or design elements, you may prefer an existing home.
3. Join an established neighborhood
Existing homes give you the option to get to know the neighborhood, community, or traffic patterns before you commit. Plus, they have more developed landscaping and trees, which can give you additional privacy and curb appeal.
4. Move in faster
If you have a short timeframe to move or you just don’t want the process to take several months while your home is under construction, buying an existing home might make sense for you. U.S. News <a href="https://realestate.usnews.com/real-estate/articles/should-you-buy-a-new-build-or-previously-owned-home" title="explains" target="_blank" rel="noopener noreferrer">explains</a>:
“When you’re choosing a home, existing or new, you should also consider how long it might take to move into that home. Just because you have a contract doesn’t mean that your new home will be completed (or even started) at the time you agree to the purchase. It can be a struggle waiting for the walls to go up as you wonder what your home will become.”
When thinking about where you’ll go after you <a href="https://www.portlandareaproperties.com/portlandareaproperties.com/blog/3-best-practices-for-selling-your-house-this-year/" title="sell your house" target="_blank">sell your house</a>, remember your options. As you start your search, think about what’s most important to you. By working with a trusted <a href="https://portlandareaproperties.com/blog/planning-to-sell-your-house-its-critical-to-hire-a-pro/" title="real estate agent" target="_blank">real estate agent</a>, you can be confident you’re making the most educated, informed decision.
Bottom Line
If you have questions about the options in our area, let’s discuss what's available and what's right for you, so you’re ready to make your next move with confidence.
Source: https://www.simplifyingthemarket.com/en/2023/01/30/where-will-you-go-if-you-sell-you-have-options/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2023-01-30T09:00:00-07:002023-01-30T09:28:51-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:8339Portland Area Home Sales | Why It May Be Time To Add Newly Built Homes to Your Search<img width="750" height="410" src="https://files.mykcm.com/2022/11/14151103/why-it-may-be-time-to-add-newly-built-homes-to-your-search-KCM.jpg" class="attachment-entry size-entry wp-post-image" alt="Why It May Be Time To Add Newly Built Homes to Your Search | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/11/14151103/why-it-may-be-time-to-add-newly-built-homes-to-your-search-KCM.jpg 750w, https://files.mykcm.com/2022/11/14151103/why-it-may-be-time-to-add-newly-built-homes-to-your-search-KCM-600x328.jpg 600w, https://files.mykcm.com/2022/11/14151103/why-it-may-be-time-to-add-newly-built-homes-to-your-search-KCM-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" style="font-size: 17px;" />
If you put a pause on your home search because you weren’t sure where you’d go once you <a href="https://www.portlandareaproperties.com/blog/sell-your-house-before-the-holidays/" title="sold your house" target="_blank">sold your house</a>, it might be a good time to get back into the market. If you’re willing to work with a trusted agent to consider a newly built home, you may have even more options and incentives than you realize. That may be why the National Association of Home Builders (NAHB) <a href="https://www.builderonline.com/data-analysis/share-of-buyers-looking-for-new-construction-homes-continues-to-increase_c" title="says" target="_blank" rel="noopener noreferrer">says</a> the share of buyers looking for new construction is increasing:
“According to the quarterly Housing Trends Report, the popularity of new construction homes is continuing to rebound . . .”
Here’s a few reasons more buyers may be drawn to newly built homes.
More Options To Choose from and Potential Builder Incentives
When looking for a home, you can choose between existing homes (those that are already built and previously owned) and newly constructed ones. While the inventory of existing homes has increased this year, it’s still <a href="https://www.calculatedriskblog.com/2022/11/housing-november-14th-weekly-update.html" title="below" target="_blank" rel="noopener noreferrer">below</a> more typical years like 2019. Currently, according to the National Association of Realtors (NAR), there is a <a href="https://www.nar.realtor/newsroom/existing-home-sales-decreased-1-5-in-september" title="3.2-month supply" target="_blank" rel="noopener noreferrer">3.2-month supply</a> at the current sales pace. For reference, a roughly 6-month supply is considered a balanced market, leaving us in a sellers’ market today.
While it’s a smaller segment of the overall inventory of homes for sale, the supply of newly built homes has grown even more. The National Association of Home Builders (NAHB) <a href="https://eyeonhousing.org/2022/10/new-home-sales-fall-back-in-september/" title="explains" target="_blank" rel="noopener noreferrer">explains</a>:
“New single-family home inventory remained elevated at a 9.2 months’ supply (of varying stages of construction). A measure near a 6 months’ supply is considered balanced.”
Here’s why this matters for you. While you have more homes to choose from in either category, there’s one extra benefit of newly built homes. Because the inventory of newly built homes has grown so much, builders are motivated to sell their properties before they build more.
Back in the housing <a href="https://www.portlandareaproperties.com/portlandareaproperties.com/blog/3-graphs-showing-why-todays-housing-market-isnt-like-2008/" title="crash of 2008" target="_blank">crash of 2008</a>, builders were building too many homes, and that oversupply is part of what contributed to the housing bubble bursting. Now, builders don’t want to have a surplus of inventory in their pipeline, and many are offering buyers incentives to help move that inventory along. As Doug Duncan, Chief Economist at Fannie Mae, <a href="https://www.builderonline.com/data-analysis/new-home-sales-decline-10-9-in-september_o" title="explains" target="_blank" rel="noopener noreferrer">explains</a>:
“. . . a continual increase in the number of completed homes available for sale is now occurring, with the inventories of such homes now at the highest level since July 2020. . . . This suggests to us that builders may be increasingly willing to offer more aggressive incentives and discounts to maintain sales of completed inventory.”
While specifics will vary by builder and market, some buyers are seeing builders reduce prices and offer incentives. To find out what’s available in your area, lean on a trusted real estate professional.
Lifestyle Benefits of Buying a Newly Built Home
In addition to more supply and the potential for builder incentives, newly built homes have various benefits that may suit your lifestyle. For example, you likely won’t have as many little repairs to tackle, like leaky faucets, shutters to paint, and other odd jobs around the house. That can free up time for you to do other things you’re passionate about.
Another perk of a new home is that nothing in the house is used. It’s brand new and uniquely yours from day one. You’ll have all new appliances, windows, roofing, and more. These things can help lower your energy costs, which can add up to significant savings over time. You may even have the latest and greatest technology features built into your new home.
Builder <a href="https://www.builderonline.com/design/technology/what-drives-new-homebuyers-to-buy-new-build-homes-instead-of-existing" title="sums" target="_blank" rel="noopener noreferrer">sums</a> up why some buyers today are turning to newly built homes:
“For some, it’s the lure of something new and modern. For others, it’s the move-in ready experience. And now there’s another factor to consider when making this decision: technology.”
If any of these benefits appeal to you, it’s time to connect with a trusted real estate advisor to learn more.
Bottom Line
If you’re considering a newly built home, let’s connect so you have an expert guide on what’s available in our local market. Together we’ll explore your options and the benefits of an all-new home.
Source: https://www.simplifyingthemarket.com/en/2022/11/15/why-it-may-be-time-to-add-newly-built-homes-to-your-search/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2022-11-15T09:00:00-07:002022-11-15T09:07:28-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:8041Portland Area Home Sales | New Homes May Have the Incentives You’re Looking for Today<img width="750" height="410" src="https://files.mykcm.com/2022/08/31112028/20220901-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="New Homes May Have the Incentives You’re Looking for Today | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/08/31112028/20220901-KCM-Share.jpg 750w, https://files.mykcm.com/2022/08/31112028/20220901-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2022/08/31112028/20220901-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" style="font-size: 17px;" />
According to the U.S. Census Bureau, this year, builders are on pace to complete more than a million <a href="https://www.census.gov/construction/nrc/pdf/newresconst.pdf" title="new homes" target="_blank" rel="noopener noreferrer">new homes</a> in this country. If you’ve had trouble finding a home to buy over the past year, it may be time to work with your trusted agent to consider a new build and the incentives that come with it. Here’s why.
The Supply of Newly Built Homes Is Rising
When looking for a home, you can choose between existing homes (those that are already built and previously owned) and newly constructed ones. While the inventory of <a href="https://www.portlandareaproperties.com/blog/why-you-may-want-to-start-your-home-search-today/" title="existing homes" target="_blank">existing homes</a> is on the rise today, it’s still in tight supply, meaning it can be challenging to find just the right one.
The inventory of newly built homes, however, is also rising. And with more options available than there have been in years, a new home may be just the answer you’re looking for. The graph below shows just how much the supply of <a href="https://www.census.gov/construction/nrs/pdf/newressales.pdf" title="newly built homes" target="_blank" rel="noopener noreferrer">newly built homes</a> has grown this year.
<a href="https://files.mykcm.com/2022/08/31112029/20220901-MEM-Eng.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-104412" src="https://files.mykcm.com/2022/08/31112029/20220901-MEM-Eng.png" alt="New Homes May Have the Incentives You’re Looking for Today | MyKCM" width="600" height="450" /></a>
And here’s the thing – builders are also keeping a close eye on current market trends. With mortgage rates rising this year and, as a result, buyer demand softening, builders are slowing their pace of new construction. That’s because they learned their lesson in the <a href="https://www.portlandareaproperties.com/blog/why-todays-housing-inventory-proves-the-market-isnt-headed-for-a-crash/" title="housing crash" target="_blank">housing crash</a> of 2008 and want to avoid over-building and having too much inventory in their pipeline.
Basically, while there are more newly built homes on the market today than there have been in years, many builders want to sell their current inventory before adding much more – and that’s where you can really benefit. Today, builders may be more willing to work with buyers. According to a recent <a href="https://twitter.com/johnburnsjbrec/status/1560235793846865920" title="survey" target="_blank" rel="noopener noreferrer">survey</a>, 83% of builders have reduced their prices over the last three months.
What That Means for You<br />
The current supply of newly built homes for sale coupled with the fact that data shows the majority of builders are doing price reductions are both great news for you. It means you may have more options and possibly some much-needed relief if you consider newly built homes in your search.
Bottom Line
If you’re ready to buy, it may be time to look for a newly built home. To learn what’s available in our area and what incentives these builders are offering, let's connect today.
Source: https://www.simplifyingthemarket.com/en/2022/09/01/new-homes-may-have-the-incentives-youre-looking-for-today/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2022-09-01T08:01:00-07:002022-09-01T08:36:37-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:7842Portland Area Home Sales | Wondering Where You’ll Move if You Sell Your House Today?<img width="750" height="410" src="https://files.mykcm.com/2022/07/15101029/20220718-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Wondering Where You’ll Move if You Sell Your House Today? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2022/07/15101029/20220718-KCM-Share.jpg 750w, https://files.mykcm.com/2022/07/15101029/20220718-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2022/07/15101029/20220718-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" style="font-size: 17px;" />
If you put a pause on your home search because you weren’t sure where you’d go once you sold your house, it might be a <a href="https://www.portlandareaproperties.com/blog/why-the-growing-number-of-homes-for-sale-is-good-for-your-move-up/" title="good time" target="_blank">good time</a> to get back into the market. That’s because today’s market is <a href="https://www.portlandareaproperties.com/blog/is-the-housing-market-correcting/" title="undergoing a shift" target="_blank">undergoing a shift</a>, and the supply of homes for sale is increasing as a result. That means you may have a better chance of finding a home that will meet your current needs. Here are some options to consider.
Buying an Existing Home Can Give You That Lived-in Charm
According to the National Association of Realtors (NAR), the supply of <a href="https://www.nar.realtor/newsroom/existing-home-sales-fell-3-4-in-may-median-sales-price-surpasses-400000-for-the-first-time" title="existing homes" target="_blank" rel="noopener noreferrer">existing homes</a> (a home that’s been previously owned) has steadily increased since the beginning of the year. The graph below indicates inventory levels are rising, and that’s largely due to <a href="https://www.portlandareaproperties.com/blog/a-key-opportunity-for-homebuyers/" title="more homes" target="_blank">more homes</a> coming onto the market and the pace of sales slowing:
<a href="https://files.mykcm.com/2022/07/15105019/20220718-MEM-Eng-1-.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-103443" src="https://files.mykcm.com/2022/07/15105019/20220718-MEM-Eng-1-.png" alt="Wondering Where You’ll Move if You Sell Your House Today? | MyKCM" width="600" height="450" /></a>
As the graph shows, if you’re looking for a home with lived-in charm, supply is rising, and that’s great news for you.
Danielle Hale, Chief Economist for realtor.com, gives <a href="https://www.realtor.com/research/weekly-housing-trends-view-data-week-june-18-2022/" title="insight" target="_blank" rel="noopener noreferrer">insight</a> into why more homeowners are listing their homes and adding to the growing supply of existing homes today:
“Home sellers in many markets across the country continue to benefit from rising home prices and fast-selling homes. That’s prompted a growing number of homeowners to sell homes this year compared to last, giving home shoppers much needed options. We’ve seen more homes come up for sale this year compared to last year . . .”
There are several benefits to buying an existing home. Many buyers want to purchase a home with history, and the character of older houses is hard to reproduce. Existing homes can often be part of an established neighborhood featuring mature landscaping that can give you additional privacy and boost your curb appeal.
Plus, timing can be a consideration as well. With an existing home, you can move in based on the timeline you agree to with the sellers, rather than building a new home and waiting for construction to finish. This is something to keep in mind, especially if you need to move sooner rather than later.
Just remember, while more sellers are listing their homes, supply is still low overall. That means you’ll have more options to choose from as you search for your next home, but you’ll still need to be prepared for a fast-moving market.
Purchasing a Newly Built or Under Construction Home Means Brand New Everything
Census <a href="https://www.census.gov/construction/nrs/pdf/newressales.pdf" title="data" target="_blank" rel="noopener noreferrer">data</a> shows there’s an increasing number of new homes available for sale. It includes homes that are under construction, soon to be completed, and fully built. As the graph below highlights, the supply of new homes for sale has also grown this year:
<a href="https://files.mykcm.com/2022/07/15105215/20220718-MEM-Eng-2-.png" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-103445" src="https://files.mykcm.com/2022/07/15105215/20220718-MEM-Eng-2-.png" alt="Wondering Where You’ll Move if You Sell Your House Today? | MyKCM" width="600" height="450" /></a>
When building a new home, you can create your perfect living space and customize it to your lifestyle. That could mean everything from requesting energy efficient options to specific design features. Plus, you’ll have the benefit of all new appliances, windows, roofing, and more. These can all help lower your <a href="https://www.portlandareaproperties.com/blog/how-an-energy-efficient-home-can-be-a-bright-idea-infographic/" title="energy costs" target="_blank">energy costs</a>, which can add up to significant savings over time.
The lower maintenance that comes with a newer home is another great advantage. When you have a new home, you likely won’t have as many little repairs to tackle, like leaky faucets, shutters to paint, and other odd jobs around the house. And with new construction, you’ll also have warranty options that may cover portions of your investment for the first few years.
Keep in mind, purchasing a new home could mean waiting a considerable amount of time before you can move. Robert Dietz, Chief Economist and Senior Vice President for Economics and Housing Policy at the National Association of Home Builders (NAHB), <a href="https://eyeonhousing.org/2022/06/new-home-sales-increase-in-may-before-feds-june-rate-rise/" title="explains" target="_blank" rel="noopener noreferrer">explains</a>:
“New single-family home inventory remained elevated at a 7.7 months’ supply. . . . However, only 8.3% of new home inventory is completed and ready to occupy. The remaining have not started construction (25.9%) or are currently under construction.”
That’s an important factor when making your decision and one you should discuss with a trusted real estate advisor. They’ll help you think through all the pros and cons of both new and existing homes to help you arrive at your best decision.
Bottom Line
With the supply of homes for sale rising, you have options for your next home no matter what your preferences are. If you have questions or want help deciding what’s best for you, let’s connect and start the conversation today.
Source: https://www.simplifyingthemarket.com/en/2022/07/18/wondering-where-youll-move-if-you-sell-your-house-today/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2022-07-18T08:01:00-07:002022-07-18T08:15:01-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:6921Portland Area Home Sales | What You Need To Know if You’re Thinking About Building a HomeIf you’re ready to <a href="https://www.portlandareaproperties.com/blog/this-spring-presents-sellers-with-a-golden-opportunity/" title="move up" style="font-size: 17px;">move up</a>, you may be trying to decide whether you want to buy a home that's already on the market or build a new one. And since the <a href="https://www.portlandareaproperties.com/blog/how-supply-and-demand-can-impact-your-buying-and-selling-goals/" title="supply of homes" style="font-size: 17px;">supply of homes</a> available for sale today is low, you’re willing to consider either avenue. While home builders are doing everything they can to construct more houses and help narrow the supply shortage, they’re also facing delays due to factors outside of their control.
Here’s the latest on some of the key challenges homebuilders are experiencing today and how they could impact <a href="https://www.portlandareaproperties.com/blog/want-top-dollar-for-your-house-nows-the-time-to-list-it/" title="your plans">your plans</a> to move up. When you know what’s happening in the industry, you can make an informed decision on whether to look for a newly built or an existing home in your home search.
Supply Chain Issues
The first hurdle builders are dealing with is the lack of supply of various building materials. According to a <a href="https://www.housingwire.com/articles/its-crazy-homebuilders-big-and-small-struggle-to-finish-projects/" title="recent article" target="_blank" rel="noopener noreferrer">recent article</a> from HousingWire:
“. . . Nearly everything needed in the homebuilding process is facing some sort of delay and subsequent price increase.”
The supply issue isn’t just with <a href="https://nahbnow.com/2022/03/nahb-chairman-calls-for-ending-lumber-tariffs-boosting-output-at-white-house-event/" title="lumber" target="_blank" rel="noopener noreferrer">lumber</a>, even though that’s what’s covered most in the news. The article explains many other supplies are impacted too, including roofing materials, windows, <a href="https://www.builderonline.com/building/rising-costs-supply-chain-challenges-continue-to-hinder-home-building_o" title="garage doors" target="_blank" rel="noopener noreferrer">garage doors</a>, siding, and gypsum (which is used in drywall).
The difficulty in getting these items is dragging out timelines for new homes as builders wait on what they need to finish construction. And since materials are in short supply, even when they do get the product, the principle of supply and demand is driving prices up for those goods. HousingWire <a href="https://www.housingwire.com/articles/opinion-the-profitless-boom-in-residential-construction/" title="explains" target="_blank" rel="noopener noreferrer">explains</a> it like this:
“When supplies are low, charges inevitably go up, . . . Meanwhile, a lack of availability is causing huge delays, meaning builders are struggling to stay on schedule.”
The National Association of Home Builders (NAHB) <a href="https://www.nahb.org/news-and-economics/industry-news/press-releases/2022/02/january-new-home-sales-lower-but-still-solid-as-interest-rates-rise" title="agrees" target="_blank" rel="noopener noreferrer">agrees</a>:
“Builders are grappling with supply-chain issues that are extending construction times and increasing costs.”
Skilled Labor Shortage
But that’s not the only challenge with new home construction today. Builders are also having a hard time finding skilled labor, which means they’re short-handed, further dragging out their timelines. Odeta Kushi, Deputy Chief Economist at First American, <a href="https://www.housingwire.com/articles/skilled-labor-is-returning-to-homebuilding/" title="says" target="_blank" rel="noopener noreferrer">says</a> this is an ongoing challenge for the industry:
“The skilled labor shortage in the construction industry is not new – it’s been an issue for more than a decade now.”
But there is good news. The February <a href="https://www.bls.gov/news.release/pdf/empsit.pdf" title="jobs report" target="_blank" rel="noopener noreferrer">jobs report</a> shows employment gains in the construction industry. Kushi puts this encouraging news into perspective in the article mentioned above:
“Overall this was a good report, . . . The supply of workers continues to fall short of demand, but the underlying momentum of the labor market recovery is strong, and falling COVID case counts provide further forward momentum.”
That means, while finding workers continues to be a challenge for builders, there are signs of positive momentum moving forward.
How This Impacts You
HousingWire <a href="https://www.housingwire.com/articles/opinion-the-profitless-boom-in-residential-construction/" title="explains" target="_blank" rel="noopener noreferrer">explains</a> how these things can impact move-up buyers today:
“The residential construction industry is facing a crisis as builders manage the critical shortage of building materials and labor. Explosive supply and labor costs are forcing long delays. . . .”
So, when you weigh your options and try to decide between building a home or buying an existing one, factor the potential delay in new home construction into your decision. While it doesn’t mean you should cross newly built homes off your list, it does mean you should consider your timeline and if you’re willing to wait while your home is being constructed.
Bottom Line
When planning your next move, understanding the latest market conditions is key to making the best decision possible. To make sure you have all the information you need, let’s connect. Together we can make sure you know what’s happening in our local market so you can <a href="https://www.portlandareaproperties.com/blog/an-expert-advisor-will-give-you-the-best-advice-in-todays-market/" title="confidently decide">confidently decide</a> what’s right for you, your priorities, and your timeline.
Source: https://www.simplifyingthemarket.com/en/2022/03/23/what-you-need-to-know-if-youre-thinking-about-building-a-home/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2022-03-23T08:04:00-07:002022-07-11T08:17:24-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:6454Portland Area Home Sales | Struggling To Find a Home To Buy? New Construction May Be an Option.
There’s no question that the financial benefits of <a href="https://www.simplifyingthemarket.com/2021/11/29/why-now-is-a-great-time-to-sell-your-house/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="selling">selling</a> a house are outstanding today. Now is truly a great time to list if you’re ready to make a change. But if you do sell your house right now, you may be wondering where you’ll go when you move.
With so few homes available to <a href="https://www.simplifyingthemarket.com/2021/10/27/housing-challenge-or-housing-opportunity-it-depends/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="buy">buy</a> right now, you might be considering building a new home as one of your options. But you may be unsure if that’s the way to go. Let’s compare the benefits of a newly built home versus moving into an existing one, and why working with a <a href="https://www.simplifyingthemarket.com/2021/11/26/reasons-to-hire-a-real-estate-professional-infographic/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="real estate agent">real estate agent</a> throughout the process is mission-critical to your success no matter what you decide.
The Pros of Newly Built Homes
First, let’s look at the benefits of purchasing a newly constructed home. With a brand-new home, you’ll be able to:
1. Create your perfect home.
If you build a home from the ground up, you’ll have the option to select the custom features you want, including appliances, finishes, landscaping, layout, and more.
2. Cash-in on energy efficiency.
When building a home, you can choose energy-efficient options to help lower your utility costs, protect the environment, and reduce your carbon footprint.
3. Minimize the need for repairs.
Many builders offer a warranty, so you’ll have peace of mind on unlikely repairs. Plus, you won’t have as many little projects to tackle. QuickenLoans puts it like <a href="https://www.quickenloans.com/learn/old-house-vs-new-house" title="this" target="_blank" rel="noopener noreferrer">this</a>:
“Buying a new construction vs. existing home typically means you’ll have fewer repairs to do. It can be a huge relief to know that it’s unlikely you’ll have to repair the roof or replace the furnace.”
4. Have brand new everything.
Another perk of a new home is that nothing in the house is used. It’s all brand new and uniquely yours from day one.
The Pros of Existing Homes
Now, let’s compare that to the perks that come with buying an existing home. With a pre-existing home, you can:
1. Explore a wider variety of home styles and floorplans.
With decades of homes to choose from, you’ll have a broader range of floorplans and designs available.
2. Join an established neighborhood.
Existing homes give you the option to get to know the neighborhood, community, or traffic patterns before you commit.
3. Enjoy mature trees and landscaping.
Established neighborhoods also have more developed landscaping and trees, which can give you additional privacy and curb appeal. As Investopedia <a href="https://www.investopedia.com/articles/personal-finance/062614/should-you-buy-or-build-home.asp" title="says" target="_blank" rel="noopener noreferrer">says</a>, if you buy an existing home:
“Odds are, too, that the home will have mature landscaping, so you won't have to worry about starting a lawn, planting shrubs, and waiting for trees to grow.”
4. Appreciate that lived-in charm.
The character of older homes is hard to reproduce. If you value timeless craftsmanship or design elements, you may prefer an existing home. According to <a href="https://www.houseopedia.com/finding-value-and-charm-in-an-existing-home" title="Houseopedia" target="_blank" rel="noopener noreferrer">Houseopedia</a>:
“Charm is priceless. Existing homes, especially those built in the 1950’s or before, often offer architectural elements, historic charm and a quality of craftsmanship not available in new homes.”
The choice is yours. When you start your search for the perfect home, remember that you can go either route – you just need to decide which features and benefits are most important to you. Working with the guidance of your trusted real estate advisor will help you make the most informed and educated decision, so you can move into the home of your dreams.
Bottom Line
If you have questions about the options in your area, let’s discuss what's available and what's right for you, so you’re ready to make your next move with confidence.
Source: https://www.simplifyingthemarket.com/en/2021/12/08/struggling-to-find-a-home-to-buy-new-construction-may-be-an-option/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2021-12-08T10:24:00-07:002022-01-06T20:21:48-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:6212Portland Area Home Sales | Looking To Move? It Could Be Time To Build Your Dream Home.While today’s <a href="https://www.simplifyingthemarket.com/2021/10/06/what-do-supply-and-demand-tell-us-about-todays-housing-market/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="supply">supply</a> of homes for sale is still low, the number of newly built homes is increasing. If you’re <a href="https://www.simplifyingthemarket.com/2021/09/20/is-it-time-to-move-on-to-a-new-home/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="ready to sell">ready to sell</a> but have held off because you weren’t sure you’d be able to find a home to move into, newly built homes and those under construction can provide the options you’ve been waiting for.
The latest <a href="http://www.census.gov/construction/nrs/pdf/newressales.pdf" title="Census" target="_blank" rel="noopener noreferrer">Census</a> data shows the inventory of new homes is increasing this year (see graph below):<a href="https://files.simplifyingthemarket.com/2021/10/18120612/20211020-MEM-Eng-1.png?a=365763-dcb30e2e7daccff551cc8d8ee31934af" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-99644" src="https://files.mykcm.com/2021/10/18120612/20211020-MEM-Eng-1.png" alt="Looking To Move? It Could Be Time To Build Your Dream Home. | MyKCM" width="600" height="450" /></a>With more new homes coming to the market, this means you’ll have more options to choose from if you’re ready to buy. Of course, if you do consider a newly built home, you’ll want to keep timing in mind. The supply shown in the graph above includes homes at various stages of the construction process – some are near completion while others may be months away.
According to Robert Dietz, Chief Economist and Senior VP for Economics and Housing Policy for the <a href="https://eyeonhousing.org/2021/09/uptick-for-new-home-sales-in-august/" title="National Association of Home Builders" target="_blank" rel="noopener noreferrer">National Association of Home Builders</a> (NAHB):
“28% of new home inventory consists of homes that have not started construction, compared to 21% a year ago.”
Buying a home near completion is great if you’re ready to move. Alternatively, a home that has yet to break ground might benefit you if you’re ready to sell and you aren’t on a strict timeline. You’ll have an even greater opportunity to design your future home to suit your needs. No matter what, your trusted real estate advisor can help you find a home that works for you.
Bottom Line
If you want to take advantage of today’s <a href="https://www.simplifyingthemarket.com/2021/09/24/its-still-a-sellers-market-infographic/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="sellers’ market">sellers’ market</a>, but you’re not sure if you’ll be able to find a home to move into, consider a newly built home. Let’s connect today so you have a trusted real estate advisor to guide you through the sale of your house and discuss your homebuying options.
Source: https://www.simplifyingthemarket.com/en/2021/10/20/looking-to-move-it-could-be-time-to-build-your-dream-home/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2021-10-20T08:36:00-07:002021-10-20T10:39:40-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:6165Portland Area Home Sales | What’s Causing Today’s Competitive Real Estate Market? [INFOGRAPHIC]Some Highlights
Today’s strong sellers’ market is the direct result of high <a href="https://www.simplifyingthemarket.com/2021/09/14/the-truth-about-todays-buyer-demand/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="demand">demand</a> and low <a href="https://www.simplifyingthemarket.com/2021/10/06/what-do-supply-and-demand-tell-us-about-todays-housing-market/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="supply">supply</a>.
Low <a href="http://www.freddiemac.com/pmms/" title="mortgage rates" target="_blank" rel="noopener noreferrer">mortgage rates</a> and <a href="https://www.pewresearch.org/fact-tank/2020/04/28/millennials-overtake-baby-boomers-as-americas-largest-generation/" title="generational trends" target="_blank" rel="noopener noreferrer">generational trends</a> have created an increased demand for homes. Meanwhile, the slower pace of new home <a href="https://cdn.nar.realtor/sites/default/files/documents/Housing-is-Critical-Infrastructure-Social-and-Economic-Benefits-of-Building-More-Housing-6-15-2021.pdf" title="construction" target="_blank" rel="noopener noreferrer">construction</a> and homeowners <a href="https://blog.firstam.com/economics/why-homebodies-versus-pandemic-fueled-demand-will-determine-the-outlook-for-housing-market-potential" title="staying" target="_blank" rel="noopener noreferrer">staying</a> in their homes longer have both led to today’s low supply.
If you’re thinking of selling, let’s connect to talk about our <a href="https://www.nar.realtor/research-and-statistics/research-reports/realtors-confidence-index" title="local area" target="_blank" rel="noopener noreferrer">local area</a> and how you can take advantage of today’s <a href="https://www.simplifyingthemarket.com/2021/09/24/its-still-a-sellers-market-infographic/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="housing market">housing market</a>.
Source: https://www.simplifyingthemarket.com/en/2021/10/08/whats-causing-todays-competitive-real-estate-market-infographic/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2021-10-08T08:07:00-07:002021-10-08T08:09:01-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:5944Portland Area Home Sales | The Community and Economic Impacts of a Home SaleThe Community and Economic Impacts of a Home Sale
<img width="750" height="410" src="https://files.mykcm.com/2021/08/04140722/20210809-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="The Community and Economic Impacts of a Home Sale | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/08/04140722/20210809-KCM-Share.jpg 750w, https://files.mykcm.com/2021/08/04140722/20210809-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/08/04140722/20210809-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
If you’re thinking of buying or selling a house, chances are you’re focusing on the many <a href="https://www.simplifyingthemarket.com/2021/05/21/americans-choose-real-estate-as-the-best-investment-infographic/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="extraordinary ways">extraordinary ways</a> it’ll change your life. What you may not realize is that decision impacts people’s lives far beyond your own. Home purchases and sales are significant drivers of economic activity. They have a major impact on your community and the entire U.S. economy via the multiple industries and professionals that take part in the process.
The National Association of Realtors (NAR) releases a <a href="https://cdn.nar.realtor/sites/default/files/documents/2020-state-by-state-economic-impact-of-real-estate-activity-united-states-of-america-3-31-2021.pdf" title="report" target="_blank" rel="noopener noreferrer">report</a> each year that highlights just how much economic activity a home sale generates. The chart below shows how the sale of both a newly built home and an existing home impact the economy:<a href="https://files.simplifyingthemarket.com/2021/08/04140724/20210809-MEM-Eng-1.png?a=365763-dcb30e2e7daccff551cc8d8ee31934af" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-98909" src="https://files.mykcm.com/2021/08/04140724/20210809-MEM-Eng-1.png" alt="The Community and Economic Impacts of a Home Sale | MyKCM" width="600" height="338" /></a>To dive a level deeper, NAR also provides a detailed look at how that varies <a href="https://www.nar.realtor/reports/state-by-state-economic-impact-of-real-estate-activity" title="state-by-state" target="_blank" rel="noopener noreferrer">state-by-state</a> for newly-built homes (see map below):<a href="https://files.simplifyingthemarket.com/2021/08/04140727/20210809-MEM-Eng-2.png?a=365763-dcb30e2e7daccff551cc8d8ee31934af" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-98910" src="https://files.mykcm.com/2021/08/04140727/20210809-MEM-Eng-2.png" alt="The Community and Economic Impacts of a Home Sale | MyKCM" width="600" height="338" /></a>As you can see, a single home sale can have a massive effect on the overall economy. Ali Wolf, Chief Economist for Zonda, talks about this in a <a href="https://www.builderonline.com/money/economics/housing-market-is-main-driver-for-the-u-s-economy_o" title="recent article" target="_blank" rel="noopener noreferrer">recent article</a>, noting there’s a significant impact at each distinct phase of the transaction:
“The housing market contributes to the economy in four main stages: during planning and land development, throughout the actual construction of the home, at the point of sale, and upon moving in.”
When you buy or sell a home, you’re leaving a lasting impression on the community at large in addition to fulfilling your own needs. That’s because each stage of the process involves numerous contractors, specialists, lawyers, town and city officials, and so many other professionals. Every individual you work with, from your trusted <a href="https://www.simplifyingthemarket.com/2021/06/14/the-right-expert-will-guide-you-through-this-unprecedented-market/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="real estate advisor">real estate advisor</a> to the architects who design new homes, has their own team of professionals involved behind the scenes.
Bottom Line
Homebuyers and sellers are economic drivers in their community and beyond. If you’re thinking of buying or selling, let’s connect today to start the process. It won’t just change your life; it’ll make a powerful impact on our entire community.
Source: https://www.simplifyingthemarket.com/en/2021/08/09/the-community-and-economic-impacts-of-a-home-sale/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2021-08-09T08:03:00-07:002021-08-09T08:06:03-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:5942Portland Area Home Sales | Ready To Sell, but Don’t Know Where You’ll Go? [INFOGRAPHIC]Ready To Sell, but Don’t Know Where You’ll Go? [INFOGRAPHIC]
<img width="1046" height="2565" src="https://files.mykcm.com/2021/08/05134626/20210806-MEM-1046x2565.png" class="attachment-entry size-entry wp-post-image" alt="Ready To Sell, but Don’t Know Where You’ll Go? [INFOGRAPHIC] | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/08/05134626/20210806-MEM-1046x2565.png 1046w, https://files.mykcm.com/2021/08/05134626/20210806-MEM-245x600.png 245w, https://files.mykcm.com/2021/08/05134626/20210806-MEM-418x1024.png 418w, https://files.mykcm.com/2021/08/05134626/20210806-MEM-768x1883.png 768w, https://files.mykcm.com/2021/08/05134626/20210806-MEM-626x1536.png 626w, https://files.mykcm.com/2021/08/05134626/20210806-MEM-835x2048.png 835w, https://files.mykcm.com/2021/08/05134626/20210806-MEM-100x245.png 100w, https://files.mykcm.com/2021/08/05134626/20210806-MEM.png 1300w" sizes="(max-width: 1046px) 100vw, 1046px" /><br /><br />
Some Highlights
If you’re <a href="https://www.quickenloans.com/learn/old-house-vs-new-house" title="thinking" target="_blank" rel="noopener noreferrer">thinking</a> of selling your house but don’t know what you should buy, you have <a href="https://www.simplifyingthemarket.com/2021/07/16/experts-agree-options-are-improving-for-buyers-infographic/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="options">options</a>.
Existing homes offer a wide variety of home styles, an established neighborhood, and lived-in charm. Meanwhile, <a href="https://www.simplifyingthemarket.com/2021/07/05/home-builders-ramp-up-construction-based-on-demand/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="new home construction">new home construction</a> lets you create your perfect home, cash in on energy efficiency, and minimize repairs.
Whether you’re <a href="https://www.investopedia.com/articles/personal-finance/062614/should-you-buy-or-build-home.asp" title="looking" target="_blank" rel="noopener noreferrer">looking</a> for newly built or existing homes, both have their perks. If you’re ready to <a href="https://www.simplifyingthemarket.com/2021/08/04/sellers-make-todays-home-price-appreciation-work-for-you/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="sell">sell</a> your house, let’s connect today to go over the perks of both existing and newly built homes to find out what’s right for you.
Source: https://www.simplifyingthemarket.com/en/2021/08/06/ready-to-sell-but-dont-know-where-youll-go-infographic/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2021-08-06T08:09:00-07:002021-08-06T08:38:45-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:5939Portland Area Home Sales | Surprising Shift Favors Homeowners: Buyers Now Prefer Existing HomesSurprising Shift Favors Homeowners: Buyers Now Prefer Existing Homes
<img width="750" height="410" src="https://files.mykcm.com/2021/08/02135720/20210805-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Surprising Shift Favors Homeowners: Buyers Now Prefer Existing Homes | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/08/02135720/20210805-KCM-Share.jpg 750w, https://files.mykcm.com/2021/08/02135720/20210805-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/08/02135720/20210805-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
In April, the National Association of Home Builders (NAHB) posted an article, <a href="https://eyeonhousing.org/2021/04/home-buyers-preferences-shift-towards-new-construction/" title="Home Buyers’ Preferences Shift Towards New Construction" target="_blank" rel="noopener noreferrer">Home Buyers’ Preferences Shift Towards New Construction</a>, which reported:
“60% of people who were looking to buy a home in 2020 said they'd prefer new construction to an existing home.”
However, it seems buyers are now shifting their preferences back to existing homes.
The latest <a href="https://www.conference-board.org/data/consumerconfidence.cfm" title="Consumer Confidence Survey" target="_blank" rel="noopener noreferrer">Consumer Confidence Survey</a> reveals the percentage of Americans planning to buy a home in the next six months is virtually the same as it was back in March. However, the percentage that plan to buy a newly constructed home is lower for that same period.
NAHB confirms this sentiment in their latest <a href="https://eyeonhousing.org/wp-content/uploads/2021/07/HOUSING-TRENDS-REPORT-Q221.pdf?_ga=2.121964555.1460318833.1627861533-1134178126.1605647352" title="Housing Trends Report" target="_blank" rel="noopener noreferrer">Housing Trends Report</a>. The organization explains that existing homes are now the top preference among today’s buyers. Here’s a breakdown of those findings:<a href="https://files.simplifyingthemarket.com/2021/08/02135722/20210805-MEM-Eng-1.png?a=365763-dcb30e2e7daccff551cc8d8ee31934af" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-98897" src="https://files.mykcm.com/2021/08/02135722/20210805-MEM-Eng-1.png" alt="Surprising Shift Favors Homeowners: Buyers Now Prefer Existing Homes | MyKCM" width="600" height="450" /></a>
Why the shift?
There are several reasons why buyer preference is shifting. Here are two that impact purchasers looking to move in now:
The process may move faster. Builders may not be able to guarantee when the house will be complete and ready for move-in due to supply chain challenges with materials like lumber and appliances. If you buy an existing home, not only is it ready, it also likely has a refrigerator, range, and other necessary home appliances already.
There are no unexpected costs during the buying process. With the price of land, labor, and lumber being so volatile, many builders are including an escalation clause in the price negotiation to cover rising expenses. With an existing home, the final price you will pay is negotiated upfront.
Bottom Line
If you’re a homeowner looking to sell, your house is more attractive to a greater number of buyers as compared to earlier in the year. This might be the time for us to connect to discuss the possibility.
Source: https://www.simplifyingthemarket.com/en/2021/08/05/surprising-shift-favors-homeowners-buyers-now-prefer-existing-homes/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2021-08-05T08:02:00-07:002021-08-05T08:45:58-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:5900Portland Area Home Sales | A Look at Housing Supply and What It Means for SellersA Look at Housing Supply and What It Means for Sellers
<img width="750" height="410" src="https://files.mykcm.com/2021/07/26170117/20210727-KCM-Share0.jpg" class="attachment-entry size-entry wp-post-image" alt="A Look at Housing Supply and What It Means for Sellers | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/07/26170117/20210727-KCM-Share0.jpg 750w, https://files.mykcm.com/2021/07/26170117/20210727-KCM-Share0-600x328.jpg 600w, https://files.mykcm.com/2021/07/26170117/20210727-KCM-Share0-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
One of the hottest topics of conversation in today’s real estate market is the <a href="https://www.simplifyingthemarket.com/2021/06/15/hope-is-on-the-horizon-for-todays-housing-shortage/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="shortage of available homes">shortage of available homes</a>. Simply put, there are many more potential buyers than there are homes for sale. As a seller, you’ve likely heard that low supply is good news for you. It means your house will get more attention, and likely, more offers. But as life begins to return to normal, you may be wondering if that’s something that will change.
While it may be tempting to blame the pandemic for the current inventory shortage, the pandemic can’t take all the credit. While it did make some sellers hold off on listing their houses over the past year, the truth is the low supply of homes was years in the making. Let’s take a look at the root cause and what the future holds to uncover why now is still a great time to sell.
Where Did the Shortage Come From?
It’s not just today’s high buyer demand. Our low supply goes hand-in-hand with the number of new homes built over the past decades. According to Sam Khater, VP and Chief Economist at <a href="http://www.freddiemac.com/perspectives/sam_khater/20210415_single_family_shortage.page" title="Freddie Mac" target="_blank" rel="noopener noreferrer">Freddie Mac</a>:
“The main driver of the housing shortfall has been the long-term decline in the construction of single-family homes.”
Data in a <a href="https://cdn.nar.realtor/sites/default/files/documents/Housing-is-Critical-Infrastructure-Social-and-Economic-Benefits-of-Building-More-Housing-6-15-2021.pdf" title="recent report" target="_blank" rel="noopener noreferrer">recent report</a> from the National Association of Realtors (NAR) tells the same story. New home construction has been lagging behind the norm for quite some time. Historically, builders completed an average of 1.5 million new housing units per year. However, since the housing bubble in 2008, the level of new home construction has fallen off (see graph below):<a href="https://files.simplifyingthemarket.com/2021/07/26170119/20210727-MEM-Eng-1.png?a=365763-dcb30e2e7daccff551cc8d8ee31934af" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-98794" src="https://files.mykcm.com/2021/07/26170119/20210727-MEM-Eng-1.png" alt="A Look at Housing Supply and What It Means for Sellers | MyKCM" width="600" height="450" /></a>The same NAR report elaborates on the impact of this below-average pace of construction:
“. . . the underbuilding gap in the U.S. totaled more than 5.5 million housing units in the last 20 years.”
“Looking ahead, in order to fill an underbuilding gap of approximately 5.5 million housing units during the next 10 years, while accounting for historical growth, new construction would need to accelerate to a pace that is well above the current trend, to more than 2 million housing units per year. . . .”
That means if we build even more new houses than the norm every year, it’ll still take a decade to close the underbuilding gap contributing to today’s supply-and-demand mix. Does that mean today’s ultimate <a href="https://www.simplifyingthemarket.com/2021/03/29/what-it-means-to-be-in-a-sellers-market/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="sellers’ market">sellers’ market</a> is here to stay?
We’re already starting to see an increase in <a href="https://www.simplifyingthemarket.com/2021/07/05/home-builders-ramp-up-construction-based-on-demand/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="new home construction">new home construction</a>, which is great news. But newly built homes can’t bridge the supply gap we’re facing right now on their own. In the <a href="https://www.jchs.harvard.edu/sites/default/files/reports/files/Harvard_JCHS_State_Nations_Housing_2021.pdf" title="State of the Nation’s Housing 2021 Report" target="_blank" rel="noopener noreferrer">State of the Nation’s Housing 2021 Report</a>, the Joint Center for Housing Studies of Harvard University (JCHS) says:
“…Although part of the answer to the nation’s housing shortage, new construction can only do so much to ease short-term supply constraints. To meet today’s strong demand, more existing single-family homes must come on the market.”
Early Indicators Show More Existing-Home Inventory Is on Its Way
When we look at existing homes, the latest reports signal that <a href="https://www.simplifyingthemarket.com/2021/07/14/housing-supply-is-rising-what-does-that-mean-for-you/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="housing supply is growing">housing supply is growing</a> gradually month-over-month. This uptick in existing homes for sale shows things are beginning to shift. Based on recent data, <a href="https://twitter.com/odetakushi/status/1407344750534041615" title="Odeta Kushi" target="_blank" rel="noopener noreferrer">Odeta Kushi</a>, Deputy Chief Economist at First American, has this to say:
“It looks like existing inventory is starting to inch up, which is good news for a housing market parched for more supply.”
Lawrence Yun, Chief Economist at NAR, <a href="https://www.nar.realtor/real-estate-today" title="echoes that sentiment:" target="_blank" rel="noopener noreferrer">echoes that sentiment:</a>
“As the inventory is beginning to pick up ever so modestly, we are still facing a housing shortage, but we may have turned a corner.”
So, what does all of this mean for you? Just because life is starting to return to normal, it doesn’t mean you missed out on the best time to sell. It’s not too late to take advantage of <a href="https://www.simplifyingthemarket.com/2021/06/16/dont-wait-to-sell-your-house/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="today’s sellers’ market">today’s sellers’ market</a> and use <a href="https://www.simplifyingthemarket.com/2021/07/06/a-look-at-home-price-appreciation-through-2025/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="rising equity">rising equity</a> and <a href="https://www.simplifyingthemarket.com/2021/07/19/what-you-should-do-before-interest-rates-rise/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="low interest rates">low interest rates</a> to make your next move.
Bottom Line
It’s still a great time to sell. Even though housing supply is starting to trend up, it’s still hovering near historic lows. Let’s connect to discuss how you can list your house now and use the inventory shortage to get the best possible terms for you.
Source: https://www.simplifyingthemarket.com/en/2021/07/27/a-look-at-housing-supply-and-what-it-means-for-sellers/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2021-07-27T08:18:00-07:002021-07-27T08:01:09-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:5885Portland Area Home Sales | 3 Charts That Show This Isn’t a Housing Bubble3 Charts That Show This Isn’t a Housing Bubble
<img width="750" height="410" src="https://files.mykcm.com/2021/07/19150730/20210720-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="3 Charts That Show This Isn’t a Housing Bubble | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/07/19150730/20210720-KCM-Share.jpg 750w, https://files.mykcm.com/2021/07/19150730/20210720-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/07/19150730/20210720-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
With home prices continuing to deliver double-digit increases, some are concerned we’re in a housing bubble like the one in 2006. However, a closer look at the market data indicates this is nothing like 2006 for three major reasons.
1. The housing market isn’t driven by risky mortgage loans.
Back in 2006, nearly everyone could qualify for a loan. The <a href="https://www.mba.org/news-research-and-resources/research-and-economics/single-family-research/mortgage-credit-availability-index" title="Mortgage Credit Availability Index" target="_blank" rel="noopener noreferrer">Mortgage Credit Availability Index</a> (MCAI) from the Mortgage Bankers’ Association is an indicator of the availability of mortgage money. The higher the index, the easier it is to obtain a mortgage. The MCAI more than doubled from 2004 (378) to 2006 (869). Today, the index stands at 130. As an example of the difference between today and 2006, let’s look at the <a href="https://www.newyorkfed.org/microeconomics/hhdc/background.html" title="volume of mortgages" target="_blank" rel="noopener noreferrer">volume of mortgages</a> that originated when a buyer had less than a 620 credit score.<a href="https://files.simplifyingthemarket.com/2021/07/19150732/20210720-MEM-Eng-1.png?a=365763-dcb30e2e7daccff551cc8d8ee31934af" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-98641" src="https://files.mykcm.com/2021/07/19150732/20210720-MEM-Eng-1.png" alt="3 Charts That Show This Isn’t a Housing Bubble | MyKCM" width="600" height="450" /></a>Dr. Frank Nothaft, Chief Economist for CoreLogic, reiterates this <a href="https://www.corelogic.com/intelligence/u-s-home-price-insights/" title="point" target="_blank" rel="noopener noreferrer">point</a>:
“There are marked differences in today’s run up in prices compared to 2005, which was a bubble fueled by risky loans and lenient underwriting. Today, loans with high-risk features are absent and mortgage underwriting is prudent.”
2. Homeowners aren’t using their homes as ATMs this time.
During the housing bubble, as prices skyrocketed, people were refinancing their homes and pulling out large sums of cash. As prices began to fall, that caused many to spiral into a negative equity situation (where their mortgage was higher than the value of the house).
Today, homeowners are letting their equity build. Tappable equity is the amount available for homeowners to access before hitting a maximum 80% combined loan-to-value ratio (thus still leaving them with at least 20% equity). In 2006, that number was $4.6 billion. Today, that number stands at over <a href="https://www.blackknightinc.com/wp-content/uploads/2021/07/BKI_MM_May2021_Report.pdf" title="$8 billion" target="_blank" rel="noopener noreferrer">$8 billion</a>.
Yet, the percentage of cash-out refinances (where the homeowner takes out at least 5% more than their original mortgage amount) is <a href="http://www.freddiemac.com/research/datasets/refinance-stats/index.page" title="half of what it was in 2006" target="_blank" rel="noopener noreferrer">half of what it was in 2006</a>.<a href="https://files.simplifyingthemarket.com/2021/07/19150734/20210720-MEM-Eng-2.png?a=365763-dcb30e2e7daccff551cc8d8ee31934af" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-98642" src="https://files.mykcm.com/2021/07/19150734/20210720-MEM-Eng-2.png" alt="3 Charts That Show This Isn’t a Housing Bubble | MyKCM" width="600" height="450" /></a>
3. This time, it’s simply a matter of supply and demand.
FOMO (the Fear Of Missing Out) dominated the housing market leading up to the 2006 housing bubble and drove up buyer demand. Back then, housing supply more than kept up as many homeowners put their houses on the market, as evidenced by the over seven months’ supply of existing housing inventory available for sale in 2006. Today, that number is barely two months.
Builders also overbuilt during the bubble but pulled back significantly over the next decade. Sam Khater, VP and Chief Economist, Economic & Housing Research at Freddie Mac, <a href="http://www.freddiemac.com/perspectives/sam_khater/20210415_single_family_shortage.page" title="explains" target="_blank" rel="noopener noreferrer">explains</a> that pullback is the major factor in the lack of available inventory today:
“The main driver of the housing shortfall has been the long-term decline in the construction of single-family homes.”
Here’s a chart that quantifies Khater’s remarks:<a href="https://files.simplifyingthemarket.com/2021/07/19150737/20210720-MEM-Eng-3.png?a=365763-dcb30e2e7daccff551cc8d8ee31934af" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-98643" src="https://files.mykcm.com/2021/07/19150737/20210720-MEM-Eng-3.png" alt="3 Charts That Show This Isn’t a Housing Bubble | MyKCM" width="600" height="450" /></a>Today, there are simply not enough homes to keep up with current demand.
Bottom Line
This market is nothing like the run-up to 2006. Bill McBride, the author of the prestigious Calculated Risk blog, predicted the last housing bubble and crash. This is what he has to say about <a href="https://www.theatlantic.com/ideas/archive/2021/05/us-housing-market-records/619029/" title="today’s housing market" target="_blank" rel="noopener noreferrer">today’s housing market</a>:
“It’s not clear at all to me that things are going to slow down significantly in the near future. In 2005, I had a strong sense that the hot market would turn and that, when it turned, things would get very ugly. Today, I don’t have that sense at all, because all of the fundamentals are there. Demand will be high for a while because Millennials need houses. Prices will keep rising for a while because inventory is so low.”
Source: https://www.simplifyingthemarket.com/en/2021/07/20/3-charts-that-show-this-isnt-a-housing-bubble/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2021-07-20T08:18:00-07:002021-07-20T10:16:12-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:5842Portland Area Home Sales | Home Builders Ramp Up Construction Based on DemandHome Builders Ramp Up Construction Based on Demand
<img width="750" height="410" src="https://files.mykcm.com/2021/07/01155253/20210705-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Home Builders Ramp Up Construction Based on Demand | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/07/01155253/20210705-KCM-Share.jpg 750w, https://files.mykcm.com/2021/07/01155253/20210705-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/07/01155253/20210705-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
If you’re thinking of buying a home, there really is no time like <a href="https://www.simplifyingthemarket.com/2021/06/30/what-do-experts-see-on-the-horizon-for-the-second-half-of-the-year/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="the present" target="_blank" rel="noopener noreferrer">the present</a>. With today’s low mortgage rates, you have a great opportunity to get more home for your money. The challenge is inventory. Like you, many buyers want to capitalize on these market conditions, and it’s leading to more buyer competition and bidding wars.
If you’re having a <a href="https://www.simplifyingthemarket.com/2021/06/25/homebuyers-hang-in-there-infographic/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="hard time" target="_blank" rel="noopener noreferrer">hard time</a> finding a home to buy, it may be time to talk to your trusted real estate advisor about a newly built home. Early indicators show new-home construction is beginning to ramp up. While new homes alone won’t be able to fix all of the <a href="https://www.simplifyingthemarket.com/2021/06/15/hope-is-on-the-horizon-for-todays-housing-shortage/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="inventory challenges" target="_blank" rel="noopener noreferrer">inventory challenges</a>, this does mean you’ll soon have more options as you search for a home. As a buyer, a newly built home may be exactly what you’re looking for – it’s brand new, and with builder customization options, it’s uniquely yours from the ground up.
Here’s what industry experts are saying about new homes coming to market:
Nadia Evangelou, Senior Economist and Director of Forecasting at the National Association of Realtors (NAR), says <a href="https://www.nar.realtor/blogs/economists-outlook/tracking-housing-construction-at-the-local-level-april-2021" title="recent research" target="_blank" rel="noopener noreferrer">recent research</a> could indicate upward momentum when it comes to new home construction. Evangelou refers to the volume of new homes where construction began during a set period, known in the industry as housing starts.
According to that research, housing starts reached their highest level since 2006 in March of this year – an encouraging sign for the industry. While they dipped slightly in April, Evangelou reiterates that the level of housing construction is heading in a positive direction compared to recent years:
“…we are currently building 24% more homes than we typically have built in April in the last couple of decades. Thus, housing construction is trending upward with housing starts likely to reach 1.6 million for all of 2021 and rise further to 1.7 million in 2022.”
As new data pours in, it further confirms this trend. According to the latest <a href="https://www.census.gov/construction/nrc/pdf/newresconst.pdf" title="Monthly New Residential Construction" target="_blank" rel="noopener noreferrer">Monthly New Residential Construction</a> report from the U.S. Census Bureau, housing starts increased even more in May, which continues the ongoing upward trend (see graph below) and indicates that ground is being broken on even more new homes.<a href="https://files.simplifyingthemarket.com/2021/07/01155256/20210705-MEM-Eng-1.png?a=365763-dcb30e2e7daccff551cc8d8ee31934af" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-98467" src="https://files.mykcm.com/2021/07/01155256/20210705-MEM-Eng-1.png" alt="Home Builders Ramp Up Construction Based on Demand | MyKCM" width="600" height="450" /></a>Robert Dietz, Chief Economist and Senior Vice President of Economics and Housing Policy for the <a href="https://eyeonhousing.org/2021/06/single-family-starts-steady-in-may/" title="National Association of Home Builders" target="_blank" rel="noopener noreferrer">National Association of Home Builders</a> (NAHB), singles out another encouraging sign:
“It is also worth noting that the number of single-family homes permitted but not started construction continued to increase in May, rising to 142,000 units.”
This insight that there’s also an uptick in single-family homes permitted serves as an additional sign that more new homes lie ahead. It’s important to realize that the construction doesn’t have to start on these homes before you may be able to purchase one. According to the <a href="https://www.census.gov/construction/nrs/pdf/newressales.pdf" title="Monthly New Residential Sales" target="_blank" rel="noopener noreferrer">Monthly New Residential Sales</a> report from the U.S. Census Bureau, many new homes are selling before construction even begins (see graph below):<a href="https://files.simplifyingthemarket.com/2021/07/01155258/20210705-MEM-Eng-2.png?a=365763-dcb30e2e7daccff551cc8d8ee31934af" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-98468" src="https://files.mykcm.com/2021/07/01155258/20210705-MEM-Eng-2.png" alt="Home Builders Ramp Up Construction Based on Demand | MyKCM" width="600" height="450" /></a>These signs are all good news for housing inventory. And as the recent challenges of rising lumber prices and dwindling lumber supply <a href="https://www.builderonline.com/products/lumber-prices-begin-to-recover_s" title="begin to improve" target="_blank" rel="noopener noreferrer">begin to improve</a>, builders will be able to increase their production even more in the months ahead.
Bottom Line
While the inventory challenges we’re facing today won’t be solved overnight, the increase in new-home construction means your house may have more competition in the market. Let’s connect to talk about <a href="https://www.simplifyingthemarket.com/2021/02/05/thinking-about-building-a-new-home-your-agent-is-critical-infographic/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="finding your dream home" target="_blank" rel="noopener noreferrer">finding your dream home</a> and the newly built homes available in our area.
Source: https://www.simplifyingthemarket.com/en/2021/07/05/home-builders-ramp-up-construction-based-on-demand/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2021-07-05T08:13:00-07:002021-07-05T08:16:48-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:5766Portland Area Home Sales | Hope Is on the Horizon for Today’s Housing ShortageHope Is on the Horizon for Today’s Housing Shortage
<img width="750" height="410" src="https://files.mykcm.com/2021/06/11120049/20210615-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Hope Is on the Horizon for Today’s Housing Shortage | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/06/11120049/20210615-KCM-Share.jpg 750w, https://files.mykcm.com/2021/06/11120049/20210615-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/06/11120049/20210615-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
The major challenge in today’s housing market is that there are more buyers looking to purchase than there are homes available to buy. Simply put, supply can’t keep up with demand. A normal market has a 6-month supply of homes for sale. Anything over that indicates it’s a buyers’ market, but an inventory level below that threshold means we’re in a <a href="https://www.simplifyingthemarket.com/2021/03/29/what-it-means-to-be-in-a-sellers-market/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="sellers’ market" target="_blank" rel="noopener noreferrer">sellers’ market</a>. Today’s inventory level sits far below the norm.
According to the <a href="https://www.nar.realtor/newsroom/existing-home-sales-decline-2-7-in-april" title="Existing Home Sales Report" target="_blank" rel="noopener noreferrer">Existing Home Sales Report</a> from the National Association of Realtors (NAR):
“Total housing inventory at the end of April amounted to 1.16 million units, up 10.5% from March's inventory and down 20.5% from one year ago (1.46 million). Unsold inventory sits at a 2.4-month supply at the current sales pace, slightly up from March's 2.1-month supply and down from the 4.0-month supply recorded in April 2020. These numbers continue to represent near-record lows.”
Basically, while we are seeing some improvement, we’re still at near-record lows for housing inventory (as shown in the graph below). Here’s why. Since the pandemic began, sellers have been cautious when it comes to putting their homes on the market. At the same time that fewer people are listing their homes, more and more people are trying to buy them thanks to today’s low<a href="https://www.simplifyingthemarket.com/2021/05/05/are-interest-rates-expected-to-rise-over-the-next-year/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title=" mortgage rates" target="_blank" rel="noopener noreferrer"> mortgage rates</a>. The influx of buyers aiming to capitalize on those rates are purchasing this <a href="https://www.simplifyingthemarket.com/2021/04/23/this-isnt-a-bubble-its-simply-lack-of-supply-infographic/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="limited supply" target="_blank" rel="noopener noreferrer">limited supply</a> of homes as quickly as they’re coming to market.<a href="https://files.simplifyingthemarket.com/2021/06/11120054/20210615-MEM-Eng-1.png?a=365763-dcb30e2e7daccff551cc8d8ee31934af" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-98214" src="https://files.mykcm.com/2021/06/11120054/20210615-MEM-Eng-1.png" alt="Hope Is on the Horizon for Today’s Housing Shortage | MyKCM" width="600" height="450" /></a>This inventory shortage doesn’t just apply to existing homes that are already built. When it comes to <a href="https://www.simplifyingthemarket.com/2021/04/28/patience-is-the-key-to-buying-a-home-this-year/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="new construction" target="_blank" rel="noopener noreferrer">new construction</a>, builders are trying to do their part to bring more newly built homes into the market. However, due to challenges with things like lumber supply, they’re also not able to keep up with demand. In their <a href="https://www.census.gov/construction/nrs/pdf/newressales.pdf" title="Monthly New Residential Sales report" target="_blank" rel="noopener noreferrer">Monthly New Residential Sales report</a>, the United States Census Bureau states:
“The seasonally‐adjusted estimate of new houses for sale at the end of April was 316,000. This represents a supply of 4.4 months at the current sales rate.”
<a href="https://files.simplifyingthemarket.com/2021/06/11120051/20210615-MEM-Eng-2.png?a=365763-dcb30e2e7daccff551cc8d8ee31934af" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-98213" src="https://files.mykcm.com/2021/06/11120051/20210615-MEM-Eng-2.png" alt="Hope Is on the Horizon for Today’s Housing Shortage | MyKCM" width="600" height="450" /></a>Sam Khater, Chief Economist at Freddie Mac, <a href="http://www.freddiemac.com/perspectives/sam_khater/20210415_single_family_shortage.page" title="elaborates" target="_blank" rel="noopener noreferrer">elaborates</a>:
“In the span of five decades, entry level construction fell from 418,000 units per year in the late 1970s to 65,000 in 2020.
While in 2020 only 65,000 entry-level homes were completed, there were 2.38 million first-time homebuyers that purchased homes. Not all renters looking to purchase their first home were in the market for entry-level homes, however, the large disparity illustrates the significant and rapidly widening gap between entry-level supply and demand.”
Despite today’s low inventory, there is hope on the horizon.
Regarding existing home sales, Sabrina Speianu, Senior Economic Research Analyst at realtor.com, <a href="https://www.realtor.com/research/may-2021-data/" title="explains" target="_blank" rel="noopener noreferrer">explains</a>:
“In May, newly listed homes grew by 5.4% on a year-over-year basis compared to the earlier days of the COVID-19 pandemic last year…
In May, the share of newly listed homes compared to active daily inventory hit a historical high of 44.4%, 17.3 percentage points higher than last year and 15.1 percentage points above typical levels seen in 2017 to 2019. This is a reflection of quickly selling homes and, for buyers, it means that while they can expect fresh new listings every week, they will have to be prepared to move quickly on desirable homes.”
As for newly built homes, builders are also confident about what’s ahead for housing inventory. Robert Dietz, Chief Economist at the National Association of Home Builders (NAHB), <a href="https://eyeonhousing.org/2021/05/hmi-building-materials-top-housing-concerns/" title="shares" target="_blank" rel="noopener noreferrer">shares</a>:
“Builder confidence in the market remains strong due to a lack of resale inventory, low mortgage interest rates, and a growing demographic of prospective home buyers.”
Things are starting to look up for residential real estate inventory. As the country continues to reopen, <a href="https://www.simplifyingthemarket.com/2021/05/19/sellers-are-ready-to-enter-the-housing-market/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="more houses" target="_blank" rel="noopener noreferrer">more houses</a> are likely to be listed for sale. However, as long as buyer demand remains high, it will take time for the balance between supply and demand to truly neutralize.
Bottom Line
Although it may be challenging to find a house to buy in today’s market, there is hope on the horizon. <a href="https://www.simplifyingthemarket.com/2021/06/14/the-right-expert-will-guide-you-through-this-unprecedented-market/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="Let’s connect" target="_blank" rel="noopener noreferrer">Let’s connect</a> to talk about your home search so we can find your dream home this summer.
Source: https://www.simplifyingthemarket.com/en/2021/06/15/hope-is-on-the-horizon-for-todays-housing-shortage/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2021-06-15T08:04:00-07:002021-06-15T07:53:26-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:5495Portland Area Home Sales | Will the Housing Market Maintain Its Momentum?Will the Housing Market Maintain Its Momentum?
<img width="750" height="410" src="https://files.mykcm.com/2021/04/26121932/20210427-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Will the Housing Market Maintain Its Momentum? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/04/26121932/20210427-KCM-Share.jpg 750w, https://files.mykcm.com/2021/04/26121932/20210427-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/04/26121932/20210427-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
Last week’s <a href="https://www.nar.realtor/newsroom/housing-market-reaches-record-high-home-price-and-gains-in-march" title="Existing Home Sales Report" target="_blank" rel="noopener noreferrer">Existing Home Sales Report</a> from the National Association of Realtors (NAR) shows sales have dropped by 3.7% compared to the month before. This is the second consecutive month that sales have slumped. Some see this as evidence that the red-hot real estate market may be cooling. However, there could also be a simple explanation as to why existing home sales have slowed – there aren’t enough homes to buy. There are currently <a href="https://cdn.nar.realtor/sites/default/files/documents/ehs-03-2021-single-family-only-2021-04-22.pdf" title="410,000" target="_blank" rel="noopener noreferrer">410,000</a> fewer single-family homes available for sale than there were at this time last year.
Lawrence Yun, Chief Economist at NAR, explains in the report:
"The sales for March would have been measurably higher, had there been more inventory. Days-on-market are swift, multiple offers are prevalent, and buyer confidence is rising."
Yun’s insight was supported the next day when the Census Bureau released its <a href="https://www.census.gov/construction/nrs/pdf/newressales.pdf" title="Monthly New Residential Sales Report" target="_blank" rel="noopener noreferrer">Monthly New Residential Sales Report</a>. It shows that newly constructed home sales are up 20.7% over the previous month.
Buyer demand remains strong. With more of the adult population becoming vaccinated and job creation data showing encouraging signs, existing-home inventory is expected to grow in the coming months.
What will this mean for home sales going forward?
<a href="https://www.fanniemae.com/media/38961/display" title="Fannie Mae" target="_blank" rel="noopener noreferrer">Fannie Mae</a>, <a href="http://www.freddiemac.com/research/forecast/20210414_quarterly_economic_forecast.page" title="Freddie Mac" target="_blank" rel="noopener noreferrer">Freddie Mac</a>, and the <a href="https://www.mba.org/news-research-and-resources/research-and-economics/forecasts-and-commentary" title="Mortgage Bankers Association" target="_blank" rel="noopener noreferrer">Mortgage Bankers Association</a> (MBA) have all forecasted that total home sales (existing homes and new construction) will continue their momentum both this year and next. Here’s a graph showing those projections:<a href="https://files.simplifyingthemarket.com/2021/04/26121934/20210427-MEM-Eng-1.png?a=365763-dcb30e2e7daccff551cc8d8ee31934af" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-97918" src="https://files.mykcm.com/2021/04/26121934/20210427-MEM-Eng-1.png" alt="Will the Housing Market Maintain Its Momentum? | MyKCM" width="600" height="450" /></a>
Bottom Line
Living through a pandemic has caused many to re-evaluate the importance of a home and the value of homeownership. The residential real estate market will benefit from both as we move forward.
Source: https://www.simplifyingthemarket.com/en/2021/04/27/will-the-housing-market-maintain-its-momentum/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2021-04-27T08:03:00-07:002021-04-27T07:48:03-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:5412Portland Area Home Sales | Latest Jobs Report: What Does It Mean for You & the Housing Market?Latest Jobs Report: What Does It Mean for You & the Housing Market?
<img width="750" height="410" src="https://files.mykcm.com/2021/04/06120026/20210407-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Latest Jobs Report: What Does It Mean for You & the Housing Market? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/04/06120026/20210407-KCM-Share.jpg 750w, https://files.mykcm.com/2021/04/06120026/20210407-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/04/06120026/20210407-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
Last Friday, the Bureau of Labor Statistics released a very encouraging <a href="https://www.bls.gov/news.release/empsit.nr0.htm" title="jobs report" target="_blank" rel="noopener noreferrer">jobs report</a>. The economy gained 916,000 jobs in March – well above expert projections of 650,000 to 675,000. The unemployment rate fell again and is now at 6%.
What does this mean for you?
Our lives are deeply impacted by our nation’s economy. The better the economy is doing overall, the better most individuals in the country will do as well. Here’s a look at what four experts told the <a href="https://www.wsj.com/" title="Wall Street Journal" target="_blank" rel="noopener noreferrer">Wall Street Journal</a> after reviewing last week’s report.
Michael Feroli, JPMorgan Chase:
"The powerful tailwind of the reopening of economic activity appears to be gathering force; while the level of employment last month was still 8.4 million positions below that which prevailed before the pandemic, it is reasonable to expect that a majority of those lost jobs will be recouped in coming months."
Mike Fratantoni, Mortgage Bankers Association:
"We fully expect that this pace of job gains will continue for months, and anticipate that the unemployment rate, now at 6%, will be well below 5% by the end of the year."
Paul Ashworth, Capital Economics:
"With the vaccination program likely to reach critical mass within the next couple of months and the next round of fiscal stimulus providing a big boost, there is finally real light at the end of the tunnel."
Jason Schenker, Prestige Economics:
"People are getting back to work and the vaccine isn't just inoculating the population, it's clearly inoculating the economy."
What does this mean for residential real estate?
Today, the biggest challenge for homebuyers is the lack of homes currently for sale. With listing inventory <a href="https://www.realtor.com/research/" title="down 52%" target="_blank" rel="noopener noreferrer">down 52%</a> from a year ago, <a href="https://www.simplifyingthemarket.com/2021/04/02/buyer-competition-is-good-news-for-sellers-infographic/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="bidding wars" target="_blank" rel="noopener noreferrer">bidding wars</a> are skyrocketing. As a result, home prices are climbing.
One answer to this challenge is to build more homes to satisfy the demand. The latest jobs report gives hope for new housing construction, and therefore brings hope to buyers as well. Here’s what three industry economists said about the increase in construction jobs revealed in the report:
<a href="https://www.nar.realtor/blogs/economists-outlook/instant-reaction-jobs-april-2-2021" title="Lawrence Yun, Chief Economist, National Association of Realtors" target="_blank" rel="noopener noreferrer">Lawrence Yun, Chief Economist, National Association of Realtors</a>:
"Construction jobs boomed in March, one of the largest monthly gains ever. This raises the prospect for more home building and more inventory reaching the market in the upcoming months. The housing market has been hot with fast rising home prices but has been constrained by a lack of supply. By hiring more workers and building more homes, home prices will move to a manageable level to give more Americans a shot at ownership.”
<a href="https://twitter.com/odetakushi/status/1377967958761345025" title="Odeta Kushi, Deputy Chief Economist, First American" target="_blank" rel="noopener noreferrer">Odeta Kushi, Deputy Chief Economist, First American</a>:
“Great jobs report for a housing market in an inventory crisis. Residential construction building jobs increased 3.9% from pre-2020 recession peak in Feb. 2020. The construction industry remains a labor-intensive industry. We need more hammers at work to build more homes.”
<a href="https://twitter.com/dietz_econ/status/1377964640135700483" title="Robert Dietz, Chief Economist, National Association of Home Builders" target="_blank" rel="noopener noreferrer">Robert Dietz, Chief Economist, National Association of Home Builders</a>:
“Good job numbers in March for residential construction. 37,000 gain from Feb to March. 3.03 million total employment for home builders and remodelers, and up 49,100 from Jan 2020.”
Bottom Line
An improving economy with a falling unemployment rate will benefit households across the country, as well as the overall housing market.
Source: https://www.simplifyingthemarket.com/en/2021/04/07/latest-jobs-report-what-does-it-mean-for-you-the-housing-market/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2021-04-07T08:41:00-07:002021-04-07T08:44:19-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:5130Portland Area Home Sales | What Is the Strongest Tailwind to Today’s Recovering Economy? What Is the Strongest Tailwind to Today’s Recovering Economy?
<img width="750" height="410" src="https://files.mykcm.com/2021/03/16105623/20210317-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="What Is the Strongest Tailwind to Today’s Recovering Economy? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/03/16105623/20210317-KCM-Share.jpg 750w, https://files.mykcm.com/2021/03/16105623/20210317-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/03/16105623/20210317-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
Last year started off with a bang. Unemployment was under <a href="https://www.bls.gov/charts/employment-situation/civilian-unemployment-rate.htm" title="4%" target="_blank" rel="noopener noreferrer">4%</a>, forecasters were giddy with their projections for the economy, and the residential housing market had the strongest January and February activity in over a decade.
Then came the announcement on March 11, 2020, from the World Health Organization declaring COVID-19 a worldwide <a href="https://www.ajmc.com/view/a-timeline-of-covid19-developments-in-2020" title="pandemic" target="_blank" rel="noopener noreferrer">pandemic</a>. Two days later, the White House declared it a national emergency. Businesses and schools were forced to close, shelter-in-place mandates were enacted, and the economy came to a screeching halt. As a result, unemployment in this country skyrocketed to <a href="https://www.bls.gov/opub/ted/2020/unemployment-rate-rises-to-record-high-14-point-7-percent-in-april-2020.htm?view_full" title="14.9%" target="_blank" rel="noopener noreferrer">14.9%</a>.
A year later, the economy is recovering, and the U.S. has regained more than half of the <a href="https://www.bls.gov/opub/ted/2021/number-of-involuntary-part-time-workers-in-february-2021-down-from-record-highs.htm" title="jobs" target="_blank" rel="noopener noreferrer">jobs</a> that were originally lost. However, some businesses are still closed, and many schools are still struggling to reopen. Despite the past and current challenges, there is one industry that’s proven to be a tailwind helping to counter all of these headwinds to our economy. That industry is housing. Remarkably, the residential real estate market (including existing homes and new construction) has flourished over the last twelve months. <a href="https://www.cnbc.com/2021/01/22/existing-home-sales-in-2020-were-highest-since-in-over-a-decade.html" title="Sales" target="_blank" rel="noopener noreferrer">Sales</a> are up, <a href="https://www.simplifyingthemarket.com/2021/03/02/home-prices-what-happened-in-2020-what-will-happen-this-year/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="prices" target="_blank" rel="noopener noreferrer">prices</a> are appreciating, and more new homes are being <a href="https://www.census.gov/construction/nrs/pdf/newressales.pdf" title="built" target="_blank" rel="noopener noreferrer">built</a>. The housing market has been a pillar of strength in an otherwise slowly recovering economy.
How does the real estate market help the economy?
At the beginning of the pandemic, the National Association of Realtors (NAR) released a <a href="https://www.nar.realtor/blogs/economists-outlook/every-home-sale-adds-more-than-88000-to-the-economy-how-do-home-sales-affect-the-economy-in-your" title="report" target="_blank" rel="noopener noreferrer">report</a> that explained:
“Real estate has been, and remains, the foundation of wealth building for the middle class and a critical link in the flow of goods, services, and income for millions of Americans. Accounting for nearly 18% of the GDP, real estate is clearly a major driver of the U.S. economy.”
The report calculated the total economic impact of real estate-related industries on the economy as well as the expenditures that resulted from a single home sale. At a national level, their research revealed that a single newly constructed home had an economic impact of $88,416.
Here’s how it breaks down:<a href="https://files.simplifyingthemarket.com/2021/03/16105621/20210317-MEM-Eng-1.jpg?a=365763-dcb30e2e7daccff551cc8d8ee31934af" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-97545" src="https://files.mykcm.com/2021/03/16105621/20210317-MEM-Eng-1.jpg" alt="What Is the Strongest Tailwind to Today’s Recovering Economy? | MyKCM" width="600" height="450" /></a>The map below shows the impact by <a href="https://www.nar.realtor/reports/state-by-state-economic-impact-of-real-estate-activity" title="state" target="_blank" rel="noopener noreferrer">state</a>:<a href="https://files.simplifyingthemarket.com/2021/03/16105618/20210317-MEM-Eng-2.png?a=365763-dcb30e2e7daccff551cc8d8ee31934af" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-97544" src="https://files.mykcm.com/2021/03/16105618/20210317-MEM-Eng-2.png" alt="What Is the Strongest Tailwind to Today’s Recovering Economy? | MyKCM" width="600" height="450" /></a>The impact of an existing home sale is approximately $40,000.
Real estate has done more for our economic wellbeing than virtually any other industry over the last year. It’s been a beacon of light during a very challenging time in our nation’s history.
Bottom Line
Whether you’re buying a newly constructed home or one that already exists, you’re making a positive economic impact in your local community – and it’s a step toward your homeownership goals as well.
Source:
2021-03-17T08:10:00-07:002021-03-17T08:17:38-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:5095Portland Area Home Sales | Will the Housing Market Bloom This Spring?Will the Housing Market Bloom This Spring?
<img width="750" height="410" src="https://files.mykcm.com/2021/03/10134320/20210311-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Will the Housing Market Bloom This Spring? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/03/10134320/20210311-KCM-Share.jpg 750w, https://files.mykcm.com/2021/03/10134320/20210311-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/03/10134320/20210311-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
Spring is almost here, and many are wondering what it will bring for the housing market. Even though the pandemic continues on, it’s certain to be very different from the spring we experienced at this time last year. Here’s what a few industry experts have to say about the housing market and how it will bloom this season.
<a href="https://www.realtor.com/research/weekly-housing-trends-view-data-week-feb-13-2021/" title="Danielle Hale, Chief Economist, realtor.com" target="_blank" rel="noopener noreferrer">Danielle Hale, Chief Economist, realtor.com</a>:
“Despite early weakness, we expect to see new listings grow in March and April as they traditionally do heading into spring, and last year’s extraordinarily low new listings comparison point will mean year over year gains. One other potential bright spot for would-be homebuyers, new construction, which has risen at a year over year pace of 20% or more for the last few months, will provide additional for-sale inventory relief.”<br />
<a href="https://www.realtor.com/news/trends/vaccines-housing-market/" title="Ali Wolf, Chief Economist, Zonda" target="_blank" rel="noopener noreferrer">Ali Wolf, Chief Economist, Zonda</a>:
“Some people will feel comfortable listing their home during the first half of 2021. Others will want to wait until the vaccines are widely distributed. This suggests more inventory will be for sale in late 2021 and into the spring selling season in 2022.”<br />
<a href="https://freddiemac.gcs-web.com/node/22241/pdf" title="Freddie Mac:" target="_blank" rel="noopener noreferrer">Freddie Mac:</a>
“Since reaching a low point in January, mortgage rates have risen by more than 30 basis points… However, the rise in mortgage rates over the next couple of months is likely to be more muted in comparison to the last few weeks, and we expect a strong spring sales season.”
<a href="https://blog.firstam.com/economics/house-prices-are-hot-but-is-housing-overvalued" title="Mark Fleming, Chief Economist, First American" target="_blank" rel="noopener noreferrer">Mark Fleming, Chief Economist, First American</a>:
“As the housing market heads into the spring home buying season, the ongoing supply and demand imbalance all but assures more house price growth...Many find it hard to believe, but housing is actually undervalued in most markets and the gap between house-buying power and sale prices indicates there’s room for further house price growth in the months to come.”
Bottom Line
The experts are very optimistic about the housing market right now. If you pressed pause on your real estate plans over the winter, let’s chat to determine how you can re-engage in the homebuying process this spring.
Source: https://www.simplifyingthemarket.com/en/2021/03/11/will-the-housing-market-bloom-this-spring/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2021-03-11T09:00:00-07:002021-03-11T09:12:37-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:4932Portland Area Home Sales | Are There Going to Be More Homes to Buy This Year?Are There Going to Be More Homes to Buy This Year?
<img width="750" height="410" src="https://files.mykcm.com/2021/02/23105448/20210225-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Are There Going to Be More Homes to Buy This Year? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/02/23105448/20210225-KCM-Share.jpg 750w, https://files.mykcm.com/2021/02/23105448/20210225-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/02/23105448/20210225-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
If you’re looking for a home to purchase right now and having trouble finding one, you’re not alone. At a time like this when there are so <a href="https://www.simplifyingthemarket.com/2021/01/29/is-right-now-the-right-time-to-sell-infographic/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="few" target="_blank" rel="noopener noreferrer">few</a> houses for sale, it’s normal to wonder if you’ll actually find one to buy. According to the National Association of Realtors (<a href="https://www.nar.realtor/newsroom/existing-home-sales-rise-0-7-in-december-annual-sales-see-highest-level-since-2006" title="NAR" target="_blank" rel="noopener noreferrer">NAR</a>), across the country, inventory of available homes for sale is at an all-time low – the lowest point recorded since NAR began tracking this metric in 1982. There are, however, more homes expected to hit the market later this year. Let’s break down the three key places they’ll likely come from as 2021 continues on.
1. Homeowners Who Didn’t Sell Last Year
In 2020, many sellers decided to pause their moving plans for a number of different reasons. From health concerns about the pandemic to financial uncertainty, plenty of homeowners decided not to move last year.
Now that vaccines are being distributed and there’s a light at the end of the COVID-19 tunnel, it should bring some peace of mind to many potential sellers. As Danielle Hale, Chief Economist at realtor.com, <a href="https://www.realtor.com/research/weekly-housing-trends-view-data-week-feb-6-2021/" title="notes" target="_blank" rel="noopener noreferrer">notes</a>:
“Fortunately for would-be homebuyers, we expect sellers to return to the market as we see improvement in the economy and progress against the coronavirus.”
Many of the homeowners who decided not to sell in 2020 will enter the market later this year as they begin to feel more comfortable showing their house in person, understanding their financial situation, and simply having more security in life.
2. More New Homes Will Be Built
Last year was a strong year for home builders, and according to the National Association of Home Builders (<a href="https://www.washingtonpost.com/business/2021/01/11/2021-housing-market-predictions/" title="NAHB" target="_blank" rel="noopener noreferrer">NAHB</a>), 2021 is expected to be even better:
“For 2021, NAHB expects ongoing growth for single-family construction. It will be the first year for which total single-family construction will exceed 1 million starts since the Great Recession.”
With more houses being built in many markets around the country, homeowners looking for new houses that meet their <a href="https://www.simplifyingthemarket.com/2021/01/12/4-reasons-people-are-buying-homes-in-2021/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="changing" target="_blank" rel="noopener noreferrer">changing</a> needs will be able to move into their dream homes. When they sell their current houses, this will create opportunities for those looking to find a home that’s already built to do so. It sets a simple chain reaction in motion for hopeful buyers.
3. Those Impacted Financially by the Economic Crisis
Many experts don’t anticipate a large wave of <a href="https://www.simplifyingthemarket.com/2021/01/13/will-forbearance-plans-lead-to-a-tsunami-of-foreclosures/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="foreclosures" target="_blank" rel="noopener noreferrer">foreclosures</a> coming to the market, given the <a href="https://www.simplifyingthemarket.com/2020/12/14/5-steps-to-follow-when-applying-for-forbearance/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="forbearance" target="_blank" rel="noopener noreferrer">forbearance</a> options afforded to current homeowners throughout the pandemic. Some homeowners who have been impacted economically will, however, need to move this year. There are also homeowners who didn’t take advantage of the forbearance option or were already in a foreclosure situation before the pandemic began. In those cases, homeowners may decide to sell their houses instead of going into the foreclosure process, especially given the <a href="https://www.simplifyingthemarket.com/2021/02/17/3-ways-home-equity-can-have-a-major-impact-on-your-life/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="equity" target="_blank" rel="noopener noreferrer">equity</a> in homes today. Lawrence Yun, Chief Economist at NAR, <a href="https://www.investors.com/news/housing-market-outlook-2021-watch-these-stocks-trends-cities/" title="explains" target="_blank" rel="noopener noreferrer">explains</a>:
“Given the huge price gains recently, I don't think many homes will have to go to foreclosure…I think homes will just be sold, and there will be cash left over for the seller, even in a distressed situation. So that's a bit of a silver lining in that we don't expect a massive sale of distressed properties.”
As we can see, it looks like we’re going to have an increase in the number of homes for sale in 2021. With fears of the pandemic starting to ease, new homes being built, and more listings coming to the market prior to foreclosure, there’s hope if you’re planning to buy this year. And if you’re thinking of selling and making a move, doing so while demand for your house is high might create an outstanding move-up option for you.
Bottom Line
Housing demand is high and supply is low, so if you’re thinking of moving, it’s a great time to do so. There are likely many buyers who are looking for a home just like yours, and there are options coming for you to find a new house too. Let’s connect today to see how you can benefit from the opportunities available in our local market.
Source: https://www.simplifyingthemarket.com/en/2021/02/25/are-there-going-to-be-more-homes-to-buy-this-year/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2021-02-25T09:07:00-07:002021-02-25T09:29:15-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:4930Portland Area Home Sales | How Much Leverage Do Today’s House Sellers Have?How Much Leverage Do Today’s House Sellers Have?
<img width="750" height="410" src="https://files.mykcm.com/2021/02/22171719/20210224-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="How Much Leverage Do Today's House Sellers Have? | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/02/22171719/20210224-KCM-Share.jpg 750w, https://files.mykcm.com/2021/02/22171719/20210224-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2021/02/22171719/20210224-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
The housing market has been scorching hot over the last twelve months. Buyers and their high demand have far outnumbered sellers and a short supply of houses. According to the latest <a href="https://www.nar.realtor/newsroom/existing-home-sales-tick-up-0-6-in-january" title="Existing Home Sales Report" target="_blank" rel="noopener noreferrer">Existing Home Sales Report</a> from the National Association of Realtors (NAR), sales are up 23.7% from the same time last year while the inventory of homes available for sale is down 25.7%. There are 360,000 fewer single-family homes for sale today than there were at this time last year. This increase in demand coupled with such limited supply is leading to more bidding wars throughout the country.
Rose Quint, Assistant Vice President for Survey Research with the National Association of Home Builders (NAHB), recently <a href="https://eyeonhousing.org/2021/02/share-of-home-buyers-getting-outbid-almost-doubles-2/" title="reported" target="_blank" rel="noopener noreferrer">reported</a>:
“The number one reason long-time searchers haven’t made a home purchase is not because of their inability to find an affordably-priced home, but because they continue to get outbid by other offers.”
A survey in the NAHB report showed that 40% of buyers have been outbid for a home they wanted to purchase. This is more than twice the percentage in 2019, which was 19%.
What does this mean for sellers today?
It means sellers have tremendous leverage when negotiating with buyers.
In negotiations, leverage is the power that one side may have to influence the other side while moving closer to their negotiating position. A party's leverage is based on its ability to award benefits or eliminate costs on the other side.
In today’s market, a buyer wants three things:
To buy a home
To buy now before prices continue to appreciate
To buy now and take advantage of historically low mortgage rates while they <a href="https://www.simplifyingthemarket.com/2021/02/23/the-reason-mortgage-rates-are-projected-to-increase-and-what-it-means-for-you/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="last" target="_blank" rel="noopener noreferrer">last</a>
These three buyer needs give the homeowner tremendous leverage when selling their house. Most realize this leverage enables the seller to sell at a good price. However, there may be another need the seller has that can be satisfied by using this leverage.
Here’s an example:
Odeta Kushi, Deputy Chief Economist at First American, recently <a href="https://blog.firstam.com/economics/housing-market-potential-poised-to-grow-in-2021" title="identified" target="_blank" rel="noopener noreferrer">identified</a> a situation in which many sellers are finding themselves today:
“As mortgage rates are expected to remain near 3%, millennials continue to form households and more existing homeowners tap their equity for the purchase of a better home…Many homeowners may want to upgrade, but do not for fear that they will be unable to find a home to buy.”
She then offers a possible solution:
“While the fear of not being able to find something to buy will not disappear in a limited supply environment, new housing supply can incentivize existing homeowners to move.”
There’s no doubt many sellers would love to build a new home to perfectly fit their <a href="https://www.simplifyingthemarket.com/2021/01/12/4-reasons-people-are-buying-homes-in-2021/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="changing" target="_blank" rel="noopener noreferrer">changing</a> wants and needs. However, most builders require that they sell their house first. If the seller sells their home, where would they live while their new home is being constructed?
Going back to the concept of leverage:
As mentioned, buyers have compelling reasons to purchase a home now, and many homeowners have challenges to address if they want to sell. Perhaps they can make a deal to satisfy each party’s needs. But how?
The seller may decide to sell their home to the buyer at today’s price, which will enable the purchaser to take advantage of current mortgage rates. In return, the buyer might lease the house back to the seller for a pre-determined length of time while the seller’s new home is being built. A true win-win negotiation.
Not every buyer will agree to such a deal – but you only need one.
That’s just one example of how a seller might be able to overcome a challenge because of the leverage they have in today’s market. Maybe you feel a need to make certain repairs before selling. Perhaps you need time to get permits or approvals for certain upgrades you made to the house. Whatever the challenge, you may be able to work it out.
Bottom Line
If you’re considering selling your house now but worry a huge obstacle stands in your way, let's connect. Maybe with the leverage you currently have, you can negotiate a deal that will allow you to make the move of your dreams.
Source: https://www.simplifyingthemarket.com/en/2021/02/24/how-much-leverage-do-todays-house-sellers-have/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2021-02-24T09:02:00-07:002021-02-24T08:58:25-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:4838Portland Area Home Sales | Thinking about Building a New Home? Your Agent Is Critical. [INFOGRAPHIC]Thinking about Building a New Home? Your Agent Is Critical. [INFOGRAPHIC]
<img width="1046" height="1853" src="https://files.mykcm.com/2021/02/04140818/20210205-MEM-1046x1853.png" class="attachment-entry size-entry wp-post-image" alt="Thinking about Building a New Home? Your Agent Is Critical. [INFOGRAPHIC] | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2021/02/04140818/20210205-MEM-1046x1853.png 1046w, https://files.mykcm.com/2021/02/04140818/20210205-MEM-339x600.png 339w, https://files.mykcm.com/2021/02/04140818/20210205-MEM-578x1024.png 578w, https://files.mykcm.com/2021/02/04140818/20210205-MEM-768x1361.png 768w, https://files.mykcm.com/2021/02/04140818/20210205-MEM-867x1536.png 867w, https://files.mykcm.com/2021/02/04140818/20210205-MEM-1156x2048.png 1156w, https://files.mykcm.com/2021/02/04140818/20210205-MEM-100x177.png 100w, https://files.mykcm.com/2021/02/04140818/20210205-MEM.png 1300w" sizes="(max-width: 1046px) 100vw, 1046px" /><br /><br />
Some Highlights
A real estate professional is an expert who can advocate on your behalf throughout the process when building a home.
Agents help you understand key steps, like choosing upgrades and managing negotiations, while staying within your budget from start to finish.
If building is the right option for you, let’s connect so you have a trusted real estate professional who can help you successfully navigate the path to your dream home.
Source: https://www.simplifyingthemarket.com/en/2021/02/05/thinking-about-building-a-new-home-your-agent-is-critical-infographic/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2021-02-05T09:02:00-07:002021-02-05T09:22:39-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:4501Portland Area Home Sales | Your House May Be High on the Buyer Wish List This Holiday SeasonYour House May Be High on the Buyer Wish List This Holiday Season
<img width="750" height="410" src="https://files.mykcm.com/2020/11/19134029/20201125-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Your House May Be High on the Buyer Wish List This Holiday Season | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2020/11/19134029/20201125-KCM-Share.jpg 750w, https://files.mykcm.com/2020/11/19134029/20201125-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2020/11/19134029/20201125-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
Around this time each year, many homeowners decide to wait until after the holidays to sell their houses. Similarly, others who already have their homes on the market remove their listings until the spring. Let’s unpack the top reasons why selling your house now, or keeping it on the market this season, is the best choice you can make. This year, buyers want to purchase homes for the holidays, and your house might be the perfect match.
Here are seven great reasons not to wait to sell your house this holiday season:<br />
1. Buyers are active now. Mortgage rates are historically low, providing <a href="https://www.simplifyingthemarket.com/2020/10/28/buyer-interest-is-growing-among-younger-generations/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="motivation" target="_blank" rel="noopener noreferrer">motivation</a> for those who are ready to get more for their money over the life of their home loan.
2. Purchasers who look for homes during the holidays are serious ones, and they’re ready to buy.
3. You can restrict the showings in your house to days and times that are most convenient for you, or even select <a href="https://www.simplifyingthemarket.com/2020/11/13/tips-to-sell-your-house-safely-right-now-infographic/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="virtual" target="_blank" rel="noopener noreferrer">virtual</a> options. You’ll remain in control, especially in today’s <a href="https://www.simplifyingthemarket.com/2020/10/29/three-ways-low-inventory-is-a-win-for-sellers/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="sellers’ market" target="_blank" rel="noopener noreferrer">sellers’ market</a>.
4. Homes decorated for the holidays appeal to many buyers.
5. Today, there’s minimal competition for you as a seller. There just aren’t enough houses on the market to satisfy buyer demand, meaning sellers are in the driver’s seat. Over the past year, inventory has declined to record lows, making it the opportune time to sell your house (See graph below):<a href="https://files.simplifyingthemarket.com/2020/11/19134031/20201125-MEM-Eng-1.jpg?a=365763-dcb30e2e7daccff551cc8d8ee31934af" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-96595" src="https://files.mykcm.com/2020/11/19134031/20201125-MEM-Eng-1.jpg" alt="Your House May Be High on the Buyer Wish List This Holiday Season | MyKCM" width="600" height="450" /></a>6. The desire to own a home doesn’t stop during the holidays. Buyers who have been searching throughout the fall and have been running into more and more bidding wars are still on the lookout. Your home may be the answer.
7. This season is the <a href="https://www.simplifyingthemarket.com/2020/10/14/the-1-reason-not-to-wait-to-list-your-house-for-sale/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="sweet spot" target="_blank" rel="noopener noreferrer">sweet spot</a> for sellers, and the number of listings will increase after the holidays. In many parts of the country, more <a href="https://www.simplifyingthemarket.com/2020/09/23/home-builder-confidence-hits-all-time-record/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="new construction" target="_blank" rel="noopener noreferrer">new construction</a> will also be available for sale in 2021, which will lessen the demand for your house next year.
Bottom Line
More than ever, this may be the year it makes the most sense to list your house during the holiday season. Let’s connect today to determine if selling now is your best move.
Source: https://www.simplifyingthemarket.com/en/2020/11/25/your-house-may-be-high-on-the-buyer-wish-list-this-holiday-season/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2020-11-25T09:00:00-07:002020-11-25T09:05:28-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:4413Portland Area Home Sales | Real Estate Is a Driving Force in the EconomyReal Estate Is a Driving Force in the Economy
<img width="750" height="410" src="https://files.mykcm.com/2020/11/03120121/20201104-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Real Estate Is a Driving Force in the Economy | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2020/11/03120121/20201104-KCM-Share.jpg 750w, https://files.mykcm.com/2020/11/03120121/20201104-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2020/11/03120121/20201104-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
As the economy recovers from this year’s health crisis, the housing market is playing a leading role in the turnaround. It’s safe to say that what we call “home” is taking on a new meaning, causing many of us to consider buying or selling sooner rather than later. Housing, therefore, has thrived in an otherwise down year.
Today’s high buyer demand combined with low housing inventory means we’re seeing home prices <a href="https://www.simplifyingthemarket.com/2020/10/22/home-values-projected-to-keep-rising/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="appreciate" target="_blank" rel="noopener noreferrer">appreciate</a> at an above-average pace. This demand is being driven by those who want to take advantage of historically low mortgage rates. According to <a href="http://www.freddiemac.com/pmms/" title="Freddie Mac" target="_blank" rel="noopener noreferrer">Freddie Mac</a>:
"The record low mortgage rate environment is providing tangible support to the economy at a critical time, as housing continues to propel growth."
These factors are driving a positive impact on the economy as a whole. According to the National Association of Realtors (NAR), the real estate industry provided $3.7 billion dollars of economic impact to the country last year. To break it down, in 2019, the average newly constructed home contributed just over $88,000 per build to local economies. Across the country, real estate clearly makes a significant impact (See map below):<a href="https://files.simplifyingthemarket.com/2020/11/03120123/20201104-MEM-Eng-1.jpg?a=365763-dcb30e2e7daccff551cc8d8ee31934af" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-96320" src="https://files.mykcm.com/2020/11/03120123/20201104-MEM-Eng-1.jpg" alt="Real Estate Is a Driving Force in the Economy | MyKCM" width="600" height="450" /></a>In addition, last week, the <a href="https://www.bea.gov/news/2020/gross-domestic-product-third-quarter-2020-advance-estimate" title="Bureau of Economic Analysis" target="_blank" rel="noopener noreferrer">Bureau of Economic Analysis</a> announced the U.S. Gross Domestic Product increased at an annual rate of 33.1% in the 3rd quarter of this year, after decreasing by 31.4% in the second quarter. There’s no doubt the growing economy is being fueled in part by the soaring housing market. Experts forecast this housing growth to carry into 2021, continuing to make a big impact on the economy next year as well.
Bottom Line
The American Dream of homeownership has continued to thrive in the midst of this year’s economic downturn, and “home” has taken on a new meaning for many of us during this time. Best of all, the housing market is making a significant impact as the economy recovers.
Source: https://www.simplifyingthemarket.com/en/2020/11/04/real-estate-is-a-driving-force-in-the-economy/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2020-11-04T08:49:00-07:002020-11-04T08:52:24-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:4312Portland Area Home Sales | The #1 Reason Not to Wait to List Your House for SaleThe #1 Reason Not to Wait to List Your House for Sale
<img width="750" height="410" src="https://files.mykcm.com/2020/10/09093355/20201014-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="The #1 Reason Not to Wait to List Your House for Sale | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2020/10/09093355/20201014-KCM-Share.jpg 750w, https://files.mykcm.com/2020/10/09093355/20201014-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2020/10/09093355/20201014-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
Many industries have been devastated by the economic shutdown caused by the COVID-19 virus. Real estate is not one of them.
Mark Fleming, Chief Economist for First American, just <a href="https://blog.firstam.com/economics/housing-market-potential-reaches-highest-level-since-2007" title="reported" target="_blank" rel="noopener noreferrer">reported</a>:
“Since hitting a low point during the initial stages of the pandemic, the only major industry to display immunity to the economic impacts of the coronavirus is the housing market. Housing has experienced a strong V-shaped recovery and is now exceeding pre-pandemic levels.”
Buyer demand is still strong heading into the fall. ShowingTime, which tracks the average number of buyer showings on residential properties, just <a href="https://www.showingtime.com/blog/august-2020-showing-index-results/" title="announced" target="_blank" rel="noopener noreferrer">announced</a> that buyer showings are up 61.9% compared to the same time last year. They went on to say:
“Normally, real estate activity begins to slow down in the late summer, but this year it peaked in July, August and into September.”
There Is One Big Challenge
Purchaser demand is so high, the market is running out of available homes for sale. Just last week, realtor.com <a href="https://news.move.com/2020-09-24-Realtor-com-R-Weekly-Housing-Report-Nearly-400-000-Fewer-Homes-Have-Been-Listed-Since-the-Start-of-the-Pandemic" title="reported" target="_blank" rel="noopener noreferrer">reported</a>:
“Since the beginning of the COVID pandemic in March, nearly 400,000 fewer homes have been listed compared to last year, leaving a gaping hole in the U.S. housing inventory.”
The National Association of Realtors (NAR) <a href="https://cdn.nar.realtor/sites/default/files/documents/ehs-08-2020-single-family-only-2020-09-22.pdf" title="revealed" target="_blank" rel="noopener noreferrer">revealed</a> that, while home sales are skyrocketing, the inventory of existing homes for sale is dropping dramatically. Below is a graph of existing inventory (September numbers are not yet available):<a href="https://files.simplifyingthemarket.com/2020/10/09093357/20201014-MEM-Eng-1.jpg?a=365763-dcb30e2e7daccff551cc8d8ee31934af" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-96102" src="https://files.mykcm.com/2020/10/09093357/20201014-MEM-Eng-1.jpg" alt="The #1 Reason Not to Wait to List Your House for Sale | MyKCM" width="600" height="450" /></a>Homebuilders are increasing construction, but they cannot keep up with the high demand. Bill McBride, founder of the Calculated Risk blog, in discussing inventory of newly constructed houses, <a href="https://www.calculatedriskblog.com/" title="notes" target="_blank" rel="noopener noreferrer">notes</a>:
“The months of supply decreased to 3.3 months...This is the all-time record low months of supply.”
What does this mean for sellers?
Anyone thinking of putting their home on the market should not wait. A seller will always negotiate the best deal when demand is high and supply is limited. That’s exactly the situation in the real estate market today.
Next year, when the pandemic is hopefully behind us, there will be many more properties coming to the market. Don’t wait for that increase in competition in your neighborhood. Now is the time to sell.
Bottom Line
Let’s connect today to get your house on the market at this optimal time to sell.
Source: https://www.simplifyingthemarket.com/en/2020/10/14/the-1-reason-not-to-wait-to-list-your-house-for-sale/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2020-10-14T07:53:00-07:002020-10-14T08:08:30-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:4289Portland Area Home Sales | Thinking of Moving? [INFOGRAPHIC]Thinking of Moving? [INFOGRAPHIC]
<img width="1046" height="2570" src="https://files.mykcm.com/2020/10/08125237/20201009-MEM-1046x2570.png" class="attachment-entry size-entry wp-post-image" alt="Thinking of Moving? [INFOGRAPHIC] | MyKCM" loading="lazy" srcset="https://files.mykcm.com/2020/10/08125237/20201009-MEM-1046x2570.png 1046w, https://files.mykcm.com/2020/10/08125237/20201009-MEM-244x600.png 244w, https://files.mykcm.com/2020/10/08125237/20201009-MEM-417x1024.png 417w, https://files.mykcm.com/2020/10/08125237/20201009-MEM-768x1887.png 768w, https://files.mykcm.com/2020/10/08125237/20201009-MEM-625x1536.png 625w, https://files.mykcm.com/2020/10/08125237/20201009-MEM-834x2048.png 834w, https://files.mykcm.com/2020/10/08125237/20201009-MEM-100x246.png 100w, https://files.mykcm.com/2020/10/08125237/20201009-MEM.png 1300w" sizes="(max-width: 1046px) 100vw, 1046px" /><br /><br />
Some Highlights
If you’re ready to sell your house but you’re worried about finding one to move into, why not invest in a brand-new home built just for you?
<a href="https://www.simplifyingthemarket.com/2020/09/23/home-builder-confidence-hits-all-time-record/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="New construction" target="_blank" rel="noopener noreferrer">New construction</a> is on the rise, so it’s a great time to think about a custom home to fit your family’s changing needs.
Let’s connect today to discuss how to sell your house while buyer <a href="https://www.simplifyingthemarket.com/2020/09/30/why-selling-this-fall-may-be-your-best-move/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="demand" target="_blank" rel="noopener noreferrer">demand</a> is high and find you a new home to call your own while you’re at it.
Source: https://www.simplifyingthemarket.com/en/2020/10/09/thinking-of-moving-infographic/?a=365763-dcb30e2e7daccff551cc8d8ee31934af
2020-10-09T08:01:00-07:002020-10-09T08:08:58-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:4224Portland Area Home Sales | Home Builder Confidence Hits All-Time RecordHome Builder Confidence Hits All-Time Record
<img width="750" height="410" src="https://files.mykcm.com/2020/09/22064219/20200923-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Home Builder Confidence Hits All-Time Record | MyKCM" srcset="https://files.mykcm.com/2020/09/22064219/20200923-KCM-Share.jpg 750w, https://files.mykcm.com/2020/09/22064219/20200923-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2020/09/22064219/20200923-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
Last week, the National Association of Home Builders (NAHB) reported their <a href="https://www.nahb.org/news-and-economics/industry-news/Press-Releases/2020/09/Builder-Confidence-Soars-to-an-All-Time-High-Lumber-Risks-Remain" title="Housing Market Index" target="_blank" rel="noopener noreferrer">Housing Market Index</a> (HMI) hit an all-time high in the 35-year history of the series with a score of 83. The index gauges builder perceptions of current single-family home sales and sale expectations for the next six months, as well as the traffic of prospective buyers of new homes.
As the following chart shows, confidence dropped dramatically when stay-in-place orders were originally mandated earlier this year. Since then, it has soared back.<a href="https://files.simplifyingthemarket.com/2020/09/22064222/20200923-MEM-Eng-1.jpg?a=365763-dcb30e2e7daccff551cc8d8ee31934af" target="_blank" rel="noopener noreferrer"><img class="aligncenter wp-image-95848" src="https://files.mykcm.com/2020/09/22064222/20200923-MEM-Eng-1.jpg" alt="Home Builder Confidence Hits All-Time Record | MyKCM" width="600" height="450" /></a>Looking at the three-month moving averages for HMI scores, confidence increased in every region of the country:
The Northeast increased 11 points to 76
The Midwest jumped 9 points to 72
The South rose 8 points to 79
The West increased 7 points to 85
Confidence Is Validated by the Numbers
This confidence is definitely warranted. According to a recent NAHB <a href="http://nahbnow.com/2020/09/single-family-housing-continues-growth-in-august/" title="report" target="_blank" rel="noopener noreferrer">report</a>, single-family housing starts increased 4.1% to a 1.02 million annual rate, and single-family permits increased 6% to a 1.04 million unit rate, meaning newly constructed homes are on the rise.
A separate <a href="https://www.mba.org/2020-press-releases/september/august-new-home-purchase-mortgage-applications-increased-333-percent" title="report" target="_blank" rel="noopener noreferrer">report</a> from the Mortgage Bankers Association (MBA) shows mortgage applications for new home purchases increased by 33.3% compared to a year ago. Joel Kan, Associate Vice President of Economic and Industry Forecasting at MBA, commented on the numbers:
"The housing market continued to exceed expectations in August, as housing demand for new homes stayed strong and the job market continued to recover…The new home market has maintained its path of recovery throughout the summer, and record-low mortgage rates and households seeking more space will likely continue to drive demand into the fall."
Bottom Line
If you’re thinking about putting your house on the market but are afraid you may not find a home to buy, let’s connect to discuss new construction opportunities in our area.
2020-09-23T09:53:00-07:002020-09-23T09:56:13-07:00Peak Realtytag:portlandareaproperties.com,2012-09-20:4186Portland Area Home Sales | Should You Buy an Existing Home or New Construction?Should You Buy an Existing Home or New Construction?
<img width="750" height="410" src="https://files.mykcm.com/2020/08/25063318/20200826-KCM-Share.jpg" class="attachment-entry size-entry wp-post-image" alt="Should You Buy an Existing Home or New Construction? | MyKCM" srcset="https://files.mykcm.com/2020/08/25063318/20200826-KCM-Share.jpg 750w, https://files.mykcm.com/2020/08/25063318/20200826-KCM-Share-600x328.jpg 600w, https://files.mykcm.com/2020/08/25063318/20200826-KCM-Share-100x55.jpg 100w" sizes="(max-width: 750px) 100vw, 750px" /><br /><br />
Finding the right home to purchase today is one of the biggest challenges for potential buyers. With so few homes for <a href="https://www.simplifyingthemarket.com/2020/07/20/thinking-of-selling-your-house-now-may-be-the-right-time/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="sale" target="_blank" rel="noopener noreferrer">sale</a> and construction of newly built homes <a href="https://www.simplifyingthemarket.com/2020/08/25/builders-realtors-agree-real-estate-is-back/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="ramping up" target="_blank" rel="noopener noreferrer">ramping up</a>, you may be wondering if you should consider <a href="https://www.simplifyingthemarket.com/2020/06/30/are-new-homes-going-to-be-available-to-buy-this-year/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="new" target="_blank" rel="noopener noreferrer">new</a> construction in your search process. It’s a great question to ask, and one to look at from the pros and cons of what it means to buy a new home versus an existing one. Here are a few things to consider when making the best decision for your family.
New Construction
When buying a new home, you can often choose more energy-efficient options. New appliances, new windows, a new roof, etc. These can all help lower your energy costs, which can add up to significant savings over time. With programs like <a href="https://www.energy.gov/eere/buildings/energy-star" title="ENERGY STAR" target="_blank" rel="noopener noreferrer">ENERGY STAR</a>, your home also helps protect the environment and reduces your carbon footprint.
Lower maintenance that comes with a newer home is another great benefit. When you have a new home, you likely won’t have as many little repairs to tackle, like leaky faucets, shutters to paint, and other odd jobs around the house. With new construction, you’ll also have warranty options that may cover portions of your investment for the first few years.
Another solid benefit to new construction is customization. Do you want a mudroom, stainless steel appliances, granite countertops, hardwood floors, an office, or a multipurpose room to <a href="https://www.simplifyingthemarket.com/2020/08/24/the-top-reasons-people-are-moving-this-year/?a=365763-dcb30e2e7daccff551cc8d8ee31934af" title="homeschool" target="_blank" rel="noopener noreferrer">homeschool</a> your children? These items can be customized to your specific needs during the design phase. With an existing home, you’re buying something that’s already completed, so if you want to make changes, you may need to hire a contractor to help get your home ready for your family.
Existing Home
When buying an existing home, you can negotiate with the current homeowner on price, which is something you generally don’t get to do with a builder. Builders know their material and construction costs, and they have a price set for the model you’re buying. So, if you want to negotiate, then maybe an existing home will be best.
For many families, having an established neighborhood is also important. Some buyers like to know the neighbors, if it’s family-friendly, and traffic patterns before making a commitment. When you buy new construction, you won’t have a full view of some of those details until the lots around you are sold.
Finally, timing comes into play. With an existing home, you can move in based on the timeline you agree to with the sellers. With new construction, you need to wait for the house to be built. Depending on the time of the year you’re buying and the region you’re in, the weather can also be a factor in the timeframe. This is something really important to keep in mind, especially if you need to move sooner rather than later. Over the past few months with COVID-19 and social distancing regulations, some areas for new construction have been delayed.
Bottom Line
Whether you want to buy a newly built home or one that’s already established, both are great options. They each have their pros and cons, and every family will have different circumstances driving their decision. If you have questions and want to know more about the options in our area, let’s connect today so you can feel confident making a decision about your next home.
2020-08-26T19:14:00-07:002020-09-16T19:15:59-07:00Peak Realty