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Have You Ever Seen a Housing Market Like This? [INFOGRAPHIC] | Simplifying The Market

Some Highlights

  • Whether you’re buying or selling – today’s housing market has plenty of good news to go around.
  • Buyers can take advantage of today’s mortgage rates to escape rising rents and keep monthly payments affordable. Sellers can reap the benefits of multiple offers and a fast sale.
  • If this sounds like good news to you, let’s connect today so you can capitalize on the unique opportunity you have in today’s market.

An important metric in today’s residential real estate market is the number of homes available for sale. The shortage of available housing inventory is the major reason for the double-digit price appreciation we’ve seen in each of the last two years. It’s the reason many would-be purchasers are frustrated with the bidding wars over the homes that are available. However, signs of relief are finally appearing.

According to data from realtor.com, active listings have increased over the last four months. They define active listings as:

The active listing count tracks the number of for sale properties on the market, excluding pending listings where a pending status is available. This is a snapshot measure of how many active listings can be expected on any given day of the specified month.”

What normally happens throughout the year?

Historically, housing inventory increases throughout the summer months, starts to tail off in the fall, and then drops significantly over the winter. The graph below shows this trend along with the month active listings peaked in 2017, 2018, and 2019.Is the Number of Homes for Sale Finally Growing? | Simplifying The Market

What happened last year?

Last year, the trend was different. Historical seasonality wasn’t repeated in 2020 since many homeowners held off on putting their houses up for sale because of the pandemic (see graph below). In 2020, active listings peaked in April, and then fell off dramatically for the remainder of the year.Is the Number of Homes for Sale Finally Growing? | Simplifying The Market

What’s happening this year?

Due to the decline of active listings in 2020, 2021 began with record-low housing inventory counts. However, we’ve been building inventory over the last several months as more listings come to the market (see graph below):Is the Number of Homes for Sale Finally Growing? | Simplifying The MarketThere are three main reasons we may see listings continue to increase throughout this fall and into the winter.

  1. Pent-up selling demand – Homeowners may be more comfortable putting their homes on the market as more and more Americans get vaccinated.
  2. New construction is starting to take off – Though new construction is not included in the realtor.com numbers, as more new homes are built, there will be more options for current homeowners to consider when they sell. The lack of options has slowed many potential sellers in the past.
  3. The end of forbearance will create some new listings – Most experts believe the end of the forbearance program will not lead to a wave of foreclosures for several reasons. The main reason is the level of equity homeowners currently have in their homes. Many homeowners will be able to sell their homes instead of going to foreclosure, which will lead to some additional listings on the market.

Bottom Line

If you’re in the market to buy a home, stick with it. There are new listings becoming available every day. If you’re thinking of selling your house, you may want to list your home before this additional competition comes to market.

When it comes to the latest news in real estate, there are a lot of sensational headlines in the media. In times like this, when it can be hard to know what to believe, put your trust in the experts. Those of us in the housing market respect that buying or selling a home is a major life decision, and we offer advice based on what the data shows.

Despite what you may have read, the housing market is still undeniably strong. Here’s a look at what leading experts have to say about buyer demand today and how it continues to shape the industry:

Michael Lane, President at ShowingTime:

“In general, there are definite signs of cooling demand. However, buyer traffic is still at historically high levels compared to pre-pandemic showings.”

Odeta Kushi, Deputy Chief Economist at First American:

“Seasonally adjusted purchase applications tick up slightly to the highest level since July. Demand for homes remains strong and steady. Excluding 2020 (not a good benchmark) purchase applications are the strongest in a decade.” 

Selma Hepp, Deputy Chief Economist at CoreLogic:

Home buyer demand pushed price growth to a new record high in June, with S&P CoreLogic national Case-Shiller Index clocking in an 18.6% year-over-year growth rate. The month-to-month index jumped 2.18%, making it another strong monthly growth, and the fastest May-to-June increase since the data series began.”

What It Means for You

As a seller, buyer demand is an important factor that helps influence how fast your house will sell and how many buyers may be competing for it. When buyers have to compete against each other for a limited supply of available homes, bidding wars can drive prices up. While things have cooled slightly since the peak of the pandemic housing rush, buyer demand is still far surpassing historical norms. That’s why we’re still in a sellers’ market.

Bottom Line

If you’re torn on whether or not you want to sell your home this year, rest assured it’s still a great time to make a move. Let’s connect to discuss how you can sell now and do it on your best terms thanks to today’s buyer demand.

Fact or Fiction: Homebuyer Edition [INFOGRAPHIC] | Simplifying The Market

Some Highlights

  • When it comes to the current housing market, there are multiple misconceptions – from what the current supply of available homes looks like to how much houses are selling for.
  • It takes professionals who study expert opinions and data to truly understand the real estate market and separate fact from fiction.
  • Trust the pros. If you want to understand why it’s still a good time to buy, let’s connect today.

Even though experts agree there’s no chance of a large-scale foreclosure crisis, there are a number of homeowners who may be coming face-to-face with foreclosure as a possibility. And while the overall percentage of homeowners at risk is decreasing with time (see graph below), that’s little comfort to those individuals who are facing challenges today.Understand Your Options To Avoid Foreclosure | Simplifying The MarketIf you haven’t taken advantage of the forbearance period, it may be time to research and understand your options. It starts with knowing what foreclosure is. Investopedia defines it like this:

Foreclosure is the legal process by which a lender attempts to recover the amount owed on a defaulted loan by taking ownership of and selling the mortgaged property. Typically, default is triggered when a borrower misses a specific number of monthly payments . . .” 

The good news is, there are alternatives available to help you avoid having to go through the foreclosure process, including:

  • Reinstatement
  • Loan modification
  • Deed-in-lieu of foreclosure
  • Short sale

But before you go down any of those paths, it’s worth seeing if you have enough equity in your home to sell it and protect your investment.

Understand Your Options: Sell Your House

Equity is the difference between what you owe on the home and its market value based on factors like price appreciation.

In today’s real estate market, many homeowners have far more equity in their homes than they realize. Over the last year, buyer demand has been high, but housing supply has been low. That’s led to a substantial increase in home values. When prices rise, so does the amount of equity you have in your house.

According to CoreLogic, on average, homeowners gained $33,400 in equity over the last 12 months, and the average equity on mortgaged homes is now $216,000 (see map below):Understand Your Options To Avoid Foreclosure | Simplifying The MarketSo, what does that mean for you? Over the past year, chances are your home’s value and therefore your equity has risen dramatically. If you’ve been in your home for a while, the mortgage payments you’ve made over time chipped away at the balance of your loan. If your home’s current value is higher than what you still owe on your loan, you may be able to use that increase to your advantage.

Frank Martell, President and CEO of CoreLogic, elaborates on how equity can help:

Homeowner equity has more than doubled over the past decade and become a crucial buffer for many weathering the challenges of the pandemic. These gains have become an important financial tool and boosted consumer confidence in the U.S. housing market.”

Don’t Go at It Alone – Lean on Experts for Advice

To find out what your house is worth in today’s market, work with a local real estate professional. We’ll be able to give you an estimate of what your house could sell for based on recent sales of similar homes in your area. Since home prices are still appreciating, you may be able to sell your house to avoid foreclosure.

If you find out that you have to pursue other options, your agent can help with that too. We’ll be able to connect you with other professionals in the industry, like housing counselors who can look into your unique situation and offer advice on next steps if selling isn’t the best alternative.

Bottom Line

If you’re a homeowner facing hardship, let’s connect to explore your options and see if you can sell your house to avoid foreclosure.

If you’re trying to decide when to sell your house, there may not be a better time to list than right now. The ultimate sellers’ market we’re in today won’t last forever. If you’re thinking of making a move, here are four reasons to put your house up for sale sooner rather than later.

1. Your House Will Likely Sell Quickly

According to the Realtors Confidence Index released by the National Association of Realtors (NAR), homes continue to sell quickly – on average, they’re selling in just 17 days. As a seller, that’s great news for you.

Average days on market is a strong indicator of buyer demand. And if homes are selling quickly, buyers have to be more decisive and act fast to submit their offer before other buyers swoop in.

2. Buyers Are Willing To Compete for Your House

In addition to selling quickly, homes are receiving multiple offers. That same survey shows sellers are seeing an average of 4.5 offers, and they’re competitive ones. The graph below shows how the average number of offers right now compares to previous years:Reasons You Should Consider Selling This Fall | Simplifying The MarketBuyers today know bidding wars are a likely outcome, and they’re coming prepared with their best offer in hand. Receiving several offers on your house means you can select the one that makes the most sense for your situation and financial well-being.

3. When Supply Is Low, Your House Is in the Spotlight

One of the most significant challenges for motivated buyers is the current inventory of homes for sale. Though it’s improving, it remains at near-record lows. The chart below shows how today’s low inventory stacks up against recent years. The lighter the blue is in the chart, the lower the housing supply.
Reasons You Should Consider Selling This Fall | Simplifying The MarketIf you’re looking to take advantage of buyer demand and get the most attention for your house, selling now before more listings come to the market might be your best option.

4. If You’re Thinking of Moving Up, Now May Be the Time

If your current home no longer meets your needs, it may be the perfect time to make a move. Today, homeowners are gaining a significant amount of wealth through growing equity. You can leverage that equity, plus current low mortgage rates, to power your move now. But these near-historic low rates won’t last forever.

Experts forecast interest rates will rise. In their forecast, Freddie Mac says:

“While we forecast rates to increase gradually later in the year, we don’t expect to see a rapid increase. At the end of the year, we forecast 30-year rates will be around 3.4%, rising to 3.8% by the fourth quarter of 2022.”

When rates rise, even modestly, it’ll impact your monthly payment and by extension your purchasing power.

Bottom Line

Don’t delay. The combination of housing supply challenges, low mortgage rates, and extremely motivated buyers gives sellers a unique opportunity this season. If you’re thinking about making a move, let’s chat about why it makes sense to list your house now.

Your Agent Is Key When Pricing Your House [INFOGRAPHIC] | Simplifying The Market

Some Highlights

  • Pricing your house right takes market experience and expertise.
  • To find the best list price, your agent balances current market demand, values of homes in your neighborhood, where prices are headed, and your home’s condition.
  • If you’re ready to sell, don’t guess on the price. Let’s connect today so we price your house to attract multiple offers and maximize your return on investment.

As rent prices continue to soar, many renters want to know what they can do to get ready to buy their first home. According to recent data from ApartmentList.com:

The first half of 2021 has seen the fastest growth in rent prices since the start of our estimates in 2017. Our national rent index has increased by 11.4 percent since January . . . .”

Those rising rental costs may make it seem impossible to prepare for homeownership if you’re a renter. But the truth is, there are ways you can – and should – prepare to purchase your first home. Here’s some expert advice on what to do if you’re ready to learn more about how to escape rising rents.

Start Saving – Even Small Amounts – Now

Experts agree, setting aside what you can – even smaller amounts of money – into a dedicated savings account is a great starting point when it comes to saving for a down payment. As Cindy Zuniga-Sanchez, Founder of Zero-Based Budget Coaching LLC, says:

“I recommend saving for a home in a ‘sinking fund’ . . . . This is a savings account separate from your emergency fund that you use to save for a short or mid-term expense.

Zuniga-Sanchez adds saving in smaller increments can help make a large goal – such as saving for a down payment –achievable:

“Breaking up your goals into smaller bite-sized pieces by saving incrementally can make a large daunting number more manageable.”

Assess Your Finances and Work on Your Credit

Another tip experts recommend: take a look at your overall finances and credit score and find ways to reduce your debt. According to the HUD, the average credit score of first-time homebuyers is 716. If you’re not sure what your credit score is, there are numerous online tools that can help you check. If your score is below that average, don’t fret. Remember that an average means there are homeowners with credit scores both above and below that threshold.

If you find out your score is below the average, there are several ways to improve your credit before you apply for a loan. HUD recommends reducing your debt as much as you can, paying your bills on time, and using your credit card responsibly.

Start the Conversation with Your Advisor Today

Finally, it’s important to talk to someone who understands the market and what it takes to become a first-time homebuyer. That’s where we come in. A trusted advisor can help you navigate your specific market and talk you through all the available options. Having the right network of real estate and lending professionals in your corner can help you plan for the homebuying process as well as determine what you can afford and how you can get pre-approved when you’re ready.

Most importantly, we can help you understand how homeownership is achievable. As Lauren Bringle, Accredited Financial Advisor with Self Financial, says:

“Don’t write home ownership off just because you have a low income . . . . With the right tools, resources and assistance, you could still achieve your dream.”

Bottom Line

If you’re planning to be a homeowner one day, the best thing you can do is start preparing now. Even if you don’t think you’ll purchase for a few years, let’s connect today to discuss the process and to set you up for success on your journey to homeownership.

It’s economy 101 – when supply is low and demand is high, prices naturally rise. That’s what’s happening in today’s housing market. Home prices are appreciating at near-historic rates, and that’s creating some challenges when it comes to home appraisals.

In recent months, it’s become increasingly common for an appraisal to come in below the contract price on the house. Shawn Telford, Chief Appraiser for CoreLogic, explains it like this:

Recently, we observed buyers paying prices above listing price and higher than the market data available to appraisers can support. This difference is known as ‘the appraisal gap . . . .’”

Why does an appraisal gap happen?

Basically, with the heightened buyer demand, purchasers are often willing to pay over asking to secure the home of their dreams. If you’ve ever toured a house you’ve fallen in love with, you understand. Once you start to picture yourself and your furniture in the rooms, you want to do everything you can to land the property, including putting in a high offer to try to beat out other would-be buyers.

When the appraiser comes in, they look at things a bit more objectively. Their job is to assess the inherent value of the home, so they’re going to study the facts. Dustin Harris, Appraiser Coach, drives this point home:

It’s important for everyone to understand that the appraiser’s job in the end is to remain that unbiased third party, to truly tell the client what that home is worth in the current market, regardless of what decisions have been made on the price side of things.”

In simple terms, while homebuyers may be willing to pay more, appraisers are there to assess the market value of the home. Their goal is to make sure the lender isn’t loaning more money than the home is worth. It’s objective, rather than emotional.

In a highly competitive market like today’s, having a discrepancy between the two numbers isn’t unusual. Here’s a look at the increasing rate of appraisal gaps, according to data from  CoreLogic (see graph below):What Buyers and Sellers Need To Know About the Appraisal Gap | Simplifying The Market

What does this mean for you?

Ultimately, knowledge is power. The best thing you can do is understand an appraisal gap may impact your transaction if you’re buying or selling. If you do encounter an appraisal below your contract price, know that in today’s sellers’ market, the most common approach is for the seller to ask the buyer to make up the difference in price. Buyers, be prepared to bring extra money to the table if you really want the home.

Above all else, lean on your real estate agent. Whether you’re a buyer or seller, your trusted advisor is your ally if you come up against an appraisal gap. We’ll help you understand your options and handle any additional negotiations that need to happen.

Bottom Line

In today’s real estate market, it’s important to stay informed on the latest trends. Let’s connect so you have an ally to help you navigate an appraisal gap to get the best possible outcome.

Your Checklist To Get Ready To Sell [INFOGRAPHIC] | Simplifying The Market

Some Highlights

  • When it comes to selling your house, you want it to look its best inside and out.
  • It’s important to focus on tasks that can make it inviting, show it’s cared for, and boost your curb appeal for prospective buyers.
  • Let’s connect to make sure your house shows well and catches a buyer’s eye.

Disclaimer: Listings identified with the FMLS IDX logo come from FMLS and are held by brokerage firms other than the owner of this website. The listing brokerage is identified in any listing details. Information is deemed reliable but is not guaranteed. If you believe any FMLS listing contains material that infringes your copyrighted work please click here to review our DMCA policy and learn how to submit a takedown request. © 2018 First Multiple Listing Service, Inc.

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Melissa Smith Realty
License #: 269175
5829 S. Vickery St. Suite E-6
Cumming, GA 30040
Direct: 404-374-3612
Office: 678-318-7900

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Legal Disclaimer: All information is believed to be accurate, but not warranted, and is subject to error, omission, and change without notice. Each Office Independently Owned and Operated. Equal Housing Opportunity.


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