Home Prices • February 22, 2024

Expert Home Price Forecasts for 2024 Revised Up

by Drew Jones

Over the past few months, experts have revised their 2024 home price forecasts based on the latest data and market signals, and they’re even more confident prices will rise, not fall.

So, let’s see exactly how experts’ thinking has shifted – and what’s caused the change.

2024 Home Price Forecasts: Then and Now

The chart below shows what seven expert organizations think will happen to home prices in 2024. It compares their first 2024 home price forecasts (made at the end of 2023) with their newest projections:

The middle column shows that, at first, these experts thought home prices would only go up a little this year. But if you look at the column on the right, you’ll see they’ve all updated their forecasts and now think prices will go up more than they originally thought. And some of the differences are major.

There are two big factors keeping such strong upward pressure on home prices. The first is how few homes are for sale right now. According to Business Insider:

“Low home inventory is a chronic problem in the US. This has generally kept home prices up . . .”

A lack of housing inventory has been pushing prices up for a long time now – and that’s not expected to change dramatically this year. But what has changed a bit is mortgage rates.

Late last year when most housing market experts were calling for home prices to rise only a little bit in 2024, mortgage rates were up and buyer demand was more moderate.

Now that rates have come down from their peak last October, and with further declines expected over the course of the year, buyer demand has picked up. That increase in demand, along with an ongoing lack of inventory, is what’s caused the experts to feel the upward pressure on prices will be stronger than they expected a couple months ago.

A Look Forward To Get Ahead of the Next Forecast Revisions

Real estate experts regularly revise their home price forecasts as the housing market shifts. It’s a normal part of their job that ensures their projections are always up-to-date and factor in the latest changes in the housing market.

That means they’ll continue to revise their projections as the housing market changes, just as they’ve always done. How those forecasts change next is anyone’s guess, but pay attention to mortgage rates.

If they trend down as the year goes on, as they’re expected to do, that could lead to more buyer demand and even higher home price forecasts.

Basically, it’s all about supply and demand. With supply still so limited, anything that causes demand to go up will likely cause prices to go up, too.

At first, experts believed home prices would only go up a little this year. But now, they’ve changed their minds and forecast prices will grow even more than they originally thought. Let’s connect so you know what to expect with prices in our area.

Mortgage Rates • February 21, 2024

Some Experts Say Mortgage Rates May Fall Below 6% Later This Year

by Drew Jones

There’s a lot of confusion in the market about what’s happening with day-to-day movement in mortgage rates right now, but here’s what you really need to know: compared to the near 8% peak last fall, mortgage rates have trended down overall.

And if you’re looking to buy or sell a home, this is a big deal. While they’re going to continue to bounce around a bit based on various economic drivers (like inflation and reactions to the consumer price index, or CPI), don’t let the short-term volatility distract you.

The experts agree the overarching downward trend should continue this year.

While we won’t see the record-low rates homebuyers got during the pandemic, some experts think we should see rates dip below 6% later this year. As Dean Baker, Senior Economist, Center for Economic Research, says:

“They will almost certainly not fall to pandemic lows, although we may soon see rates under 6.0 percent, which would be low by pre-Great Recession standards.”

And Baker isn’t the only one saying this is a possibility. The latest Fannie Mae projections also indicate we may see a rate below 6% by the end of this year (see the green box in the chart below):

The chart shows mortgage rate projections for 2024 from Fannie Mae. It includes the one that came out in December, and compares it to the updated 2024 forecast they released just one month later. And if you look closely, you’ll notice the projections are on the way down.

It’s normal for experts to re-forecast as they watch current market trends and the broader economy, but what this shows is experts are feeling confident rates should continue to decline, if inflation cools.

What This Means for You

But remember, no one can say for sure what will happen (and by when) – and short-term volatility is to be expected. So, don’t let small fluctuations scare you. Focus on the bigger picture.

If you’ve found a home you love in today’s market – especially where finding a home that meets your budget and your needs can be a challenge – it’s probably not a good idea to try to time the market and wait until rates drop below 6%.

With rates already lower than they were last fall, you have an opportunity in front of you right now. That’s because even a small quarter point dip in rates gives your purchasing power a boost.

So, if you wanted to move last year but were holding off hoping rates would fall, now may be the time to act. Let’s connect to get the ball rolling.

Buying a Home • February 20, 2024

3 Strategic Tips for Buying Your First Home

by Drew Jones

Buying your first home is a big, exciting step and a major milestone that has the power to improve your life. As a first-time homebuyer, it’s a dream you can make come true, but there are some hurdles you’ll need to overcome in today’s housing market – specifically the limited supply of homes for sale and ongoing affordability challenges.

So, if you’re ready, willing, and able to buy your first home, here are three tips to help you turn your dream into a reality.

1. Save Money with First-Time Homebuyer Programs

Paying the initial costs of homeownership, like your down payment and closing costs, can feel a bit daunting. But there are many assistance programs for first-time homebuyers that can help you get a loan with little or no money upfront. According to Bankrate:

“. . . you might qualify for a first-time homebuyer loan or assistance. First-time buyer loans typically have more flexible requirements, such as a lower down payment and credit score. Many help buyers with closing costs and the down payment through grants and low-interest loans.”

To find out more, talk to your state’s housing authority or check out websites like Down Payment Resource.

2. Expand Your Options by Looking at Condos and Townhomes

Right now, there aren’t enough homes for sale for everyone who wants to buy one. That’s pushing home prices up and making affordability tight for buyers. One way to deal with that issue and find a home right now is to consider condos and townhomes. Realtor.com explains:

“For many newbies, it might just be a matter of making a shift toward something they can better afford—like a condo or townhome. These lower-cost homes have historically been a stepping stone for buyers looking for a less expensive alternative to a single-family home.”

One reason why they may be more affordable is because they’re often smaller. But they still give you the chance to get your foot in the door and achieve your goal of owning a home and building equity. And that equity can help fuel your move into a larger home later on if you decide you need something bigger in the future.

3. Consider Pooling Your Resources To Buy a Multi-Generational Home

Another way to break into the market is by purchasing a home with friends or loved ones. That way you can split the cost of things like the mortgage and bills, to make it easier to afford a home. According to Money.com:

“Buying a home with another person has some obvious advantages in the mortgage department. With two incomes in the mix, buyers can likely qualify for a larger mortgage — a big help in today’s high-cost market.”

By exploring first-time homebuyer assistance, condos, townhomes, and multi-generational living, it can be easier to find and buy your first home. When you’re ready, let’s connect.

Selling Your House • February 19, 2024

It’s Time To Prepare Your House for a Spring Listing

by Drew Jones

If you’re thinking of selling your house this spring, now is the perfect time to start getting it ready. With the market gearing up for its busiest time of year, it’ll be important to make sure your house shines bright among the competition.

Here are some valuable tips you can use to get your house market-ready.

Declutter and Organize

First impressions matter, and if your house is a mess, that can easily turn off potential buyers. Before listing, take the time to declutter and organize each room. Decluttering is about more than just tidying up – it’s about creating a sense of space and openness that allows potential buyers to envision themselves living in your home. According to Moving.com:

“Decluttering and organizing your space will go a long way in appealing to potential buyers. . . .decluttering will help the buyers see themselves living in your home. Less clutter inside a home also helps a place appear larger and cleaner, which should attract more buyers.”

Deep Clean Your Kitchen and Bathrooms

The kitchen and bathrooms are focal points for many buyers, and often influence their overall opinion of the house. Ensure these spaces dazzle by giving them a thorough deep cleaning. Pay attention to details like scrubbing grout lines, polishing fixtures, and decluttering countertops. A sparkling kitchen and bathroom can leave a lasting positive impression on potential buyers.

Maintain Your Yard

Your home’s exterior is the first thing potential buyers see, so it’s important to make a good impression from the moment they arrive. A well-maintained yard not only enhances curb appeal, but also shows buyers the home has been well taken care of.

Take the time to spruce up your yard by mowing the lawn, trimming bushes, and clearing away any debris or dead plants. Remember, the goal is to create a welcoming environment that entices buyers to step inside and imagine themselves living there. U.S. News says:

“A beautifully landscaped front yard can elevate an ordinary house into a charming home and will help homes sell faster and for more money.”

Find a Listing Agent

A skilled listing agent is your partner in minimizing stress when selling your home. Lean on your agent for advice on decluttering, staging, and enhancing your home’s appeal to potential buyers. Their insights into market trends and recommendations for reliable contractors and stagers are invaluable. As Realtor.com says:

“A good listing agent will help you price your home . . . recommend a photographer and stager to make it look its best, and put your home on the multiple listing service.”

By decluttering, deep cleaning, and tidying up your house, you can create a welcoming environment that resonates with buyers and increases your chances of a successful sale. Let’s connect on what you need to do to get your house ready to sell this spring.

Homeownership • February 14, 2024

Why So Many People Fall in Love with Homeownership

by Drew Jones

Chances are at some point in your life you’ve heard the phrase, home is where the heart is. There’s a reason that’s said so often. Becoming a homeowner is emotional.

So, if you’re trying to decide if you want to keep on renting or if you’re ready to buy a home this year, here’s why it’s so easy to fall in love with homeownership.

Customizing to Your Heart’s Desire

Your house should be a space that’s uniquely you. And, if you’re a renter, that can be hard to achieve. When you rent, the paint colors are usually the standard shade of white, you don’t have much control over the upgrades, and you’ve got to be careful how many holes you put in the walls. But when you’re a homeowner, you have a lot more freedom. As the National Association of Realtors (NAR) says:

“The home is yours. You can decorate any way you want and choose the types of upgrades and new amenities that appeal to your lifestyle.”

Whether you want to paint the walls a cheery bright color or go for a dark moody tone, you can match your interior to your vibe. Imagine how it would feel to come home at the end of the day and walk into a space that feels like you.

Greater Stability for the Ones You Love Most

One of the hardest things about renting is the uncertainty of what happens at the end of your lease. Does your payment go up so much that you have to move? What if your landlord decides to sell the property? It’s like you’re always waiting for the other shoe to drop. Jeff Ostrowski, a business journalist covering real estate and the economy, explains how homeownership can give you more peace of mind in a Money Geek article:

“Homeownership means you are the boss and have the biggest say in your lifestyle and family decisions. Suppose your kids are in public school and you don’t want to risk having them change schools because your landlord doesn’t renew your lease. Owning a home would remove much of the risk of having to move.”

A Feeling of Belonging

You may also find you feel much more at home in the community once you own a house. That’s because, when you buy a home, you’re staking a claim and saying, I’m a part of this community. You’ll have neighbors, block parties, and more. And that’ll give you the feeling of being a part of something bigger. As the International Housing Association explains:

“. . . homeowning households are more socially involved in community affairs than their renting counterparts. This is due to both the fact that homeowners expect to remain in the community for a longer period of time and that homeowners have an ownership stake in the neighborhood.”

The Emotional High of Achieving Your Dream

Becoming a homeowner is a journey – and it may have been a long road to get to the point where you’re ready to take the plunge. If you’re seriously considering leaving behind your rental and making this commitment, you should know the emotions that come with this owning a home are powerful. You’ll be able to walk up to your front door every day and have that sense of accomplishment welcome you home.

A home is a place that reflects who you are, a safe space for the ones you love the most, and a reflection of all you’ve accomplished. Let’s connect if you’re ready to break up with your rental and buy a home.

Mortgage Rates • February 12, 2024

What’s Really Happening with Mortgage Rates?

by Drew Jones

Are you feeling a bit unsure about what’s really happening with mortgage rates? That might be because you’ve heard someone say they’re coming down. But then you read somewhere else that they’re up again. And that may leave you scratching your head and wondering what’s true.

The simplest answer is: that what you read or hear will vary based on the time frame they’re looking at. Here’s some information that can help clear up the confusion.

Mortgage Rates Are Volatile by Nature

Mortgage rates don’t move in a straight line. There are too many factors at play for that to happen. Instead, rates bounce around because they’re impacted by things like economic conditions, decisions from the Federal Reserve, and so much more. That means they might be up one day and down the next depending on what’s going on in the economy and the world as a whole.

Take a look at the graph below. It uses data from Mortgage News Daily to show the ebbs and flows in the 30-year fixed mortgage rate since last October:

If you look at the graph, you’ll see a lot of peaks and valleys – some bigger than others. And when you use data like this to explain what’s happening, the story can be different based on which two points in the graph you’re comparing.

For example, if you’re only looking at the beginning of this month through now, you may think mortgage rates are on the way back up. But, if you look at the latest data point and compare it to the peak in October, rates have trended down. So, what’s the right way to look at it?

The Big Picture

Mortgage rates are always going to bounce around. It’s just how they work. So, you shouldn’t focus too much on the small, daily changes. Instead, to really understand the overall trend, zoom out and look at the big picture.

When you look at the highest point (October) compared to where rates are now, you can see they’ve come down compared to last year. And if you’re looking to buy a home, this is big news. Don’t let the little blips distract you. The experts agree, overall, that the larger downward trend could continue this year.

Let’s connect if you have any questions about what you’re reading or hearing about the housing market.

Buying a Home • February 8, 2024

Home Equity Can Be a Game Changer When You Sell

by Drew Jones

Are you on the fence about selling your house? While affordability is improving this year, it’s still tight. But understanding your home equity could be the key to making your decision easier. An article from Bankrate explains:

“Home equity is the difference between your home’s value and the amount you still owe on your mortgage. It represents the paid-off portion of your home.

You’ll start off with a certain level of equity when you make your down payment to buy the home, then continue to build equity as you pay down your mortgage. You’ll also build equity over time as your home’s value increases.”

Think of equity as a simple math equation. It’s the value of your home now minus what you owe on your mortgage. And guess what? Recently, your equity has probably grown more than you think.

In the past few years, home prices skyrocketed, which means your home’s value – and your equity – likely shot up, too. So, you may have more equity than you realize.

How To Make the Most of Your Home Equity Right Now

If you’re thinking about moving, the equity you have in your home could be a big help. According to CoreLogic:

“. . . the average U.S. homeowner with a mortgage still has more than $300,000 in equity . . .”

Clearly, homeowners have a lot of equity right now. And the latest data from the Census and ATTOM shows over two-thirds of homeowners have either completely paid off their mortgages (shown in green in the chart below) or have at least 50% equity (shown in blue in the chart below):

That means roughly 70% have a tremendous amount of equity right now.

After you sell your house, you can use your equity to help you buy your next home. Here’s how:

Be an all-cash buyer: If you’ve been living in your current home for a long time, you might have enough equity to buy your next home without having to take out a loan. If that’s the case, you won’t need to borrow any money or worry about mortgage rates. Investopedia says:

“You may want to pay cash for your home if you’re shopping in a competitive housing market, or if you’d like to save money on mortgage interest. It could help you close a deal and beat out other buyers.”

Make a larger down payment: Your equity could also be used toward your next down payment. It might even be enough to let you put a larger amount down, so you won’t have to borrow as much money. The Mortgage Reports explains:

“Borrowers who put down more money typically receive better interest rates from lenders. This is due to the fact that a larger down payment lowers the lender’s risk because the borrower has more equity in the home from the beginning.”

So, if you’re planning a move, your home equity can really help you out. Let’s connect to see how much equity you have and how it can help with your next home.

Selling Your House • February 7, 2024

Houses Are Still Selling Fast

by Drew Jones

Have you been thinking about selling your house? If so, here’s some good news. While the housing market isn’t as frenzied as it was during the ‘unicorn’ years when houses were selling quicker than ever, they’re still selling faster than normal.

The graph below uses data from Realtor.com to tell the story of median days on the market for every January from 2017 all the way through the latest numbers available. For Realtor.com, days on the market means from the time a house is listed for sale until its closing date or the date it’s taken off the market. This metric can help give you an idea of just how quickly homes are selling compared to more normal years:

When you look at the most recent data (shown in green), it’s clear homes are selling faster than they usually would (shown in blue). In fact, the only years when houses sold even faster than they are right now were the abnormal ‘unicorn’ years (shown in pink). According to Realtor.com:

“Homes spent 69 days on the market, which is three days shorter than last year and more than two weeks shorter than before the COVID-19 pandemic.”

What Does This Mean for You?

Homes are selling faster than the norm for this time of year – and your house may sell quickly too. That’s because more people are looking to buy now that mortgage rates have come down, but there still aren’t enough homes to go around. Mike Simonsen, Founder of Altos Research, says:

“. . . 2024 is starting stronger than last year. And demand is increasing each week.”

If you’re wondering if it’s a good time to sell your home, the most recent data suggests it is. The housing market appears to be stronger than it usually is at this time of year. To get the latest updates on what’s happening in our local market, let’s connect.

Buying a New Construction Home • February 5, 2024

Why Having Your Own Agent Matters When Buying a New Construction Home

by Drew Jones

Finding the right home is one of the biggest challenges for potential buyers today. Right now, the supply of homes for sale is still low.

Newly built homes make up a larger percentage of the total homes available for sale than normal. So, if you’re looking for a home now, it might make 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 own agent helps make sure you have proper representation throughout your home-buying journey. As Realtor.com says:

“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 buy a new construction home.

Your Agent Knows 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

Your agent should also have 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

One potential 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, you’ll be glad to have a skilled negotiator on your side. Builder contracts can be complex, and your agent can help you navigate these contracts to make sure you fully understand the terms and conditions. Plus, an agent skilled in negotiating will advocate for you, potentially securing better deals, upgrades, or incentives throughout the process. As Realtor.com says:

“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.”

If you are interested in buying 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.

Selling Your House • February 1, 2024

4 Reasons to Sell Before Spring

by Drew Jones

As you think about the year ahead, one of your big goals may be moving. But, how do you know when to make your move? While spring is usually the peak homebuying season, you don’t actually need to wait until spring to sell. Here’s why.

1. Take Advantage of Lower Mortgage Rates

Last October, the 30-year fixed mortgage rates peaked at 7.79%. In January, they hit their lowest level since May. That means you may not feel as locked-in to your current mortgage rate right now. That downward trend in rates has made moving more affordable now than it was just a few months ago.

Another reason today’s rates make now a good time to sell? More buyers are jumping back into the market. Many had been waiting on the sidelines for rates to fall, but now that that’s happening, they’re eager and ready to buy. That means more demand for your house. According to Sam Khater, Chief Economist at Freddie Mac:

“Given this stabilization in rates, potential homebuyers with affordability concerns have jumped off the fence back into the market.”

2. Get Ahead of Your Competition

Right now, there are still more people looking to buy a home than there are houses for sale, which puts you in a great position. But keep in mind, with the recent uptick in new listings, we’re seeing more sellers may already be re-entering the market.

Listing your house now helps you beat your competition and makes sure your house will stand out. And if you work with an agent to price it right, it could sell fast and get multiple offers. U.S. News explains:

“When there is low housing inventory, sellers could get top dollar for their homes.”

3. Make the Most of Rising Home Prices

Experts forecast home prices will keep going up this year. What does that mean for you? If you’re ready to sell your current house and plan to buy another one, it may be a good idea to think about moving now before prices go up more. That would give you the chance to buy your next home before it gets more expensive.

4. Leverage Your Equity

Homeowners today have tremendous amounts of equity. In fact, a recent report from CoreLogic says the average homeowner with a mortgage has more than $300,000 in equity.

If you’ve been waiting to sell because you were worried about home affordability, know your equity can really help with your next move. It might even cover a big part, or maybe all, of the down payment for your next home.

If you’re thinking about selling your house, let’s connect to get the process started now so you can get a leg up on your competition.