Real estate: Spring market analysis–your guide to buying and selling
Historically, the spring real estate market starts in April. However, the times are changing! The housing market is so hot right now, that the official “spring” market actually started in January! According to Realtor.com, in 2019, January was the busiest month on the site in 20 of the largest 100 metropolitan markets—and this year, it’s even busier! What’s the cause of this? The market is competitive due to rising costs and low inventory.
Forbes recently published an article talking extensively about Texas real estate in 2020 and more specifically, Houston real estate. Right now, the Houston housing market is said to be over-priced and perhaps even at its peak. That’s why many people are choosing to rent rather than purchase. Real estate investors are torn between local economy and international impacts. For instance, right now, Houston has a strong local economy, but that could be impacted quickly by things like the price of oil, which could go up or down based on the political climate.
All of that being said, what’s that mean for individuals looking to buy or sell in 2020?
Home Prices are Rising Slowly—For buyers, this means you can expect to pay a little bit more, but, don’t be alarmed because the percentage increase of home prices in 2020 are predicted to be around 2.8% so it won’t be an increase that will leave you paralyzed and unable to make an offer. That being said, be sure to know exactly how much house you can afford. For some, this may look like exploring a new area or narrowing the wish list to stay within budget. Remember, it’s better to be confident in your financial situation than regret it later in exchange for the “perfect house.” For sellers, this means that the market is competitive and while you may have the upper-hand being that it’s a sellers’ market, you need to know what other homes in your area are selling for, in order to know how to market yours to sell.
Mortgage Interest Rates—Mortgage interest rates have been on the decline and appear to be averaging between 3.2% and 3.7% based on your (15 or 30) year mortgage. For buyers, this means that even though interest rates are low, you still need to be smart and a conventional 15-year fixed-rate mortgage is the safest way to go. For sellers, if mortgage rates continue to stay low, it’s the best possible scenario for you! However, keep an eye on the rates because if they begin to rise, even a little bit, your home may be on the market longer than expected as potential buyers start to pull back on making such a large investment.
People are considering other options—Given the increased demand and low supply of houses, people are considering other options, like building. For buyers, don’t be afraid to explore your option to build. Many contractors are moving more towards practical homes rather than just luxury. They are seeing the demand and shifting their mindset to provide homes that average people can afford! For sellers, don’t worry too much about this, because not everyone wants to go through the process of building a new home from scratch. Most are more apt to wait for the right house—which could be yours!
A bit of additional advice for our sellers out there…if your home is sitting on the market for an extended period of time, consider getting a second opinion from a trusted real estate agent on the listed price of your home. Often times, if homes are over-priced or just aren’t priced right in general—it really detours people from even coming through for an open house. Make sure it’s priced right! Wrapping up, given our research, it seems that whether you’re a buyer or a seller, 2020 is a healthy year for real estate! Don’t give up, you deserve to have an amazing space that you can call home sweet home!
