As we head into fall this year, we cannot assume a typical real estate market since atypical has become the norm the past couple of years.
We are still looking at a surplus of buyers and a shortage of homes available for them to purchase. Interest rates remain favorable, especially for first-time buyers trying to break into the real estate market. But as housing prices are being pushed up due to the lack of inventory, the cost may shut new buyers out.
Housing shortages are due to a variety of reasons, but the top 3 are:
- boomers choosing to age in place rather than move,
- lack of consumer confidence which dropped 9.8 points in June,
- the construction market has faltered with affordable housing new builds due to labor issues and the cost of materials.
Nationally, 35% of home sales in June were savvy first-time homebuyers who are taking advantage and locking in those lower interest rates.
The National Association of Realtors chief economist, Lawrence Yun said, “Home sales are running at a pace similar to 2015 levels – even with exceptionally low mortgage rates, a record number of jobs and a record high net worth in the country,” and attributed the slow sales to the ongoing lack of inventory.
Here in central Ohio, our days on the market are lower than the national average in June of 27 days. Central Ohio’s average was 23 days for the same time with the more affordable properties selling even faster at 18 days.
Home values are rising and a 5.6% increase by May 2020 is estimated by the Home Price Index Forecast.
The last four months of 2019 could pick up or slow down! If hesitant homeowners finally decide to sell, this could open the floodgates to buyers unless consumer confidence & rising prices keep buyers from purchasing in traditional pre-recession numbers.
What we don’t see slowing down anytime soon is affordable turn-key housing! Millennials are the group to watch since they are the largest group on the cusp of purchasing. We’ll be watching Senate Bill 139, Ohio’s First-Time Homebuyer Savings Act! Too late for 2019, but once this bill passes, it will assist all future first-time purchasers with a tax-free savings account to save for their first home.
If you’re contemplating a sale and are wondering what the current market value of your home is, we can help! Call The Columbus Team at (614) 888-6100 to set up an appointment for a comprehensive analysis. There is no obligation to list!