5 Things You Need to Know About the Current Status of the Housing Market

Stay ahead of the curve with these 5 tips from real estate expert Stephanie Spenner.

ESTATENVY caught up with Chicago based Chief Business Development Officer and realtor at EPOCH, Stephanie Spenner, and she shared her opinion on the things consumers need to know about the current status of the housing market.

Renting vs. Buying

In most major cities, the market for purchasing homes is booming. With a high demand for homes, clients often have the most leverage. This is important to keep in mind when pricing a home for sale. In 2017, the average home on the market sold in 81 days. Keep in mind that prices may be on the rise for homes because homeowners are realizing they may be able to get more than what they thought for their homes.

For those not ready to buy yet, renting is a great alternative. Because of the current competitive market often times clients have the upper hand. Spenner advises taking the time to ask your potential landlord or leasing agent if they can provide any type of incentive for signing a lease at their location (one-month free rent, free parking, etc.). 

Downsizing

The idea of downsizing is another current trend. Many consumers are looking to sell their larger homes and settle into smaller, or mid-sized homes that comfortably fit all their needs. Many empty nesters or single-families have adapted to this trend and find a sense of relief living in a smaller space with less ‘home’ to worry about. According to a study done by TD Ameritrade, 42% of retirees are likely to downsize if they haven’t already. Around 25% of those respondents are moving to warmer climates and 17% are moving closer to loved ones.

Spenner shared that many of her clients don’t want the responsibility of living in a home or paying a more expensive mortgage and have made the transition from their suburban homes to renting apartments.

Supply & Demand

As mentioned, the market for homes is in high demand. Therefore, the number of available homes outweighs the demand. When there are homes in surplus, the price of the homes is driven down, but as homes on the market continue to be in high demand, the prices continue to rise. First-time home-owners are having a difficult time staying ahead of the curve, with rent prices and home prices continuing to rise it makes it harder for first-time home-owners to make that transition from renting to buying.

Different Cities, Different Prices

As one might guess, when moving to different cities the price points for rent and homes differ. West Coast markets like Seattle, San Francisco and Los Angeles have high price growth yearly, whereas East Coast markets like Boston, New York and Atlanta have seen a lower price growth yearly. Economic growth is important to keep in mind when purchasing a home. Cities such as Colorado Springs, Nashville and Salt Lake City are among the few with the lowest home prices on the market currently.

Interest Rates & Credit Concerns

Spenner states the most important tip she can advise her clients is to get pre-approved to buy. She mentions that with interest rates continuing to rise that many interested buyers are getting forced out of the buy zone. Getting pre-approved and building your credit is an important step to making sure you are ready to buy. Talking with a mortgage lender is something Spenner strongly advises. A mortgage lender can help you decided how much money you want to take out as a loan when purchasing a home, and walk you through the necessary steps to take in order to make sure you are smartest with your purchase.