Throughout Women’s History Month, we reflect on the impact women have in our lives, and that includes the impact on the housing market. In fact, since at least 1981, single women have bought more homes than single men each year, and they make up 17% of all households.
The rise in women pursuing homeownership hasn’t just made an impact on the housing market. It’s also been an asset for those buyers and their households. That’s because homeownership has many benefits, both financial and personal.
On the financial side, housing proves to be the key to building wealth for single women. Ksenia Potapov, Economist at First American, says:
“For single women, housing has always made up a large share of total assets. Over the last 30 years, the average single woman’s wealth has increased 88% on an inflation-adjusted basis, from just over $142,000 in 1989 to $267,000 in 2019, and housing has remained the single largest component of their wealth.”
The financial security and independence homeownership provides can be life-changing, too. And when you factor in the personal motivations behind buying a home, that impact becomes even clearer.
A recent report from the National Association of Realtors (NAR) shares the top reasons single women are buying a home right now (see chart below):
Homeownership can be life changing no matter who you are. Let’s connect today to talk about your goals in the housing market.
Each year, homeowners planning to make a move are faced with a decision: sell their house during the holidays or wait. And others who have already listed their homes may think about removing their listings and waiting until the new year to go back on the market.
The truth is many buyers want to purchase a home for the holidays, and your house might be just what they’re looking for. Here are five great reasons you shouldn’t wait to sell your house.
1. While the supply of homes for sale has increased this year, there still aren’t enough homes on the market to keep up with buyer demand. As Nadia Evangelou, Senior Economist & Director of Forecasting at the National Association of Realtors (NAR), explains:
“There’s still this gap between demand and supply because we were underbuilding for many years. . . . So now we see demand is slowing, but it still outpaces supply.”
2. Serious homebuyers are out looking right now. Millennials are driving homebuying demand today, and many are eager to make a purchase. Mark Fleming, Chief Economist at First American, explains:
"While not the frenzy of 2021, the largest living generation, the Millennials, will continue to age into their prime home-buying years, creating a demographic tailwind for the housing market.”
3. The desire to own a home doesn’t stop during the holidays. In fact, homes decorated for the holidays appeal to many buyers. Plus, purchasers who look for homes during the holidays are ready to buy.
4. You can restrict the showings in your house to days and times that are most convenient for you. That can help you minimize disruptions, which is especially important this time of year.
5. Rents have skyrocketed in recent years. And, many buyers are looking to escape rising rents and avoid falling into the rental trap for another year. As an article from Zillow says:
“Over the next 12 months, rents are expected to grow more than inflation, the stock market and home values."
Your home could be their ticket to leaving renting behind for good.
There are still many reasons it makes sense to list your house during the holiday season. Let’s connect to determine if selling now is your best move.
Millennials are now jumping headfirst into homeownership, making up 43% of home buyers (the most of any generation), according to the latest study from the National Association of Realtors®, the 2022 Home Buyer and Seller Generational Trends report.
Millennial home buyers offer an exclusive challenge to property vendors to impress a new group of property stockholders. If you desire to target this profitable fresh market when vending your home, there are key home upgrades that will appeal to millennial home buyers, which include:
A home office has become a significant source of income for most people, especially freelancers. The trend is more common in the millennial generation; therefore, ensuring that your modern home has an office is essential. When showcasing the property, ensure that you stage a particular room as an office to impress the millennial home buyers. The real estate agent can use the home office as a bargaining chip when likely purchasers view your property.
One of the essential home upgrades a house vendor should consider having is establishing pet-friendly home features. The millennial generation is more fancied by pets, and most of them will be attracted to your modern home if it has a conducive environment for their pets. For instance, wood flooring such as oak or mahogany is the better choice to ensure easy movement of the pet around the house. Porcelain tile is also preferred since it has a high resistance to scratches or stains and thus is easy to clean. You could also consider installing screens on your windows to prevent high-rise syndrome, which occurs when a pet falls out of a high-rise building and could even result in the loss of the pet.
Any millennial will be awed by the idea of owning a modern home with cost-efficient and smart home technology. Consider eliminating outdated appliances or color schemes as you do home renovation since they will be a crucial turnoff for millennial buyers. Millennials are looking for a home they will access information from anywhere at any time, and even they can remotely monitor their homes. Some innovative home technology that would entice millennial home buyers includes:
Home sellers must make impressive home upgrades when deciding to do home renovation. Any modern home should possess an upgraded kitchen and a minibar, primarily if they target to sell their property to millennial home buyers. The young buyers are looking for side-by-side sinks, premium vanities, and walk-in pantries, among other design amenities. Therefore, look for proficient contractors to design your kitchen and minibar in an eye-catching design, especially for the present generation.
In your home makeover, ensure that you have a comfortable, fantastic outdoor space—the millennial generation desire to have an outdoor space that feels like an extension of the main house. Consider including a backyard patio or a porch that the millennials will quickly notice once they view your property as you make home upgrades; keep in mind that the buyers want a run-down backyard that can hold parties comfortably. Hire a professional who will ensure your house and the environment is appealing to everyone's eye.
Millennials are more interested in energy-saving upgrades, conserving the environment, reducing costs, and reducing their carbon footprint. For a home makeover, ensure you use high-quality materials and opt for energy-saving features. In particular, millennial home buyers would go for a home with solar panels, tankless water heaters, and property with rainwater tanks. Home upgrades will save a buyer's money and decrease the emission of greenhouse gases into the air. These young homeowners will appreciate an eco-friendly property more in terms of lighting and running of home appliances.
Having a laundry area on your property is crucial and will reduce individuals' stress when moving the laundry to the washing area. An owner of a modern home should consider having sufficient laundry area space to appeal to a millennial buyer. Everyone desires to live comfortably, and with a laundry room, you can perform numerous tasks with less effort. The laundry room is critical to most people since it is a store for chemical cleaning products that, when mishandled, could threaten adults. Your property will attract numerous clients if you have a sufficient laundry area.
As you plan on home renovation, keep in mind that millennials are looking for fancy, good-looking, and up-to-date properties. Work with a real estate professional to help you with changing the look of your home; it doesn't matter how old-fashioned it was before. Before you decide to put your house on the market, transform it into your target buyer’s lifestyle, such as energy-saving devices, innovative home technology, and an updated kitchen.
If you do a home makeover with critical modern updates, you will sell your property within a short while of displaying it. With just a few adjustments to your home, you can attract numerous buyers to your property.
Originally posted here
A long-time residential real estate professional and Certified Divorce Real Estate Expert, Shannon Rose of Silicon Valley’s Rose Group has roots in San Diego: A former Miss La Mesa, Shannon lived in East County for more than a decade and still visits family several times per year. Watching the San Diego market for some time, when Proposition 19 went into effect, she noticed a sudden uptick in buyer interest—and inquiries from people she knows—and realized her expertise would provide incredible value to sellers in Southern California’s exploding real estate market.
Shannon has already closed her first San Diego sale: an immaculate solar home in El Cajon. She and her client immediately received 13 offers, including an over-asking offer that was accepted on the home’s third day on the market.
Shannon’s best advice for her San Diego sellers: “Don't wait for the market to keep going up just so you can grab an extra $10-20K. The market is up now, but you never know when it will turn the other way,” she says. “And if you’re nervous about selling because you don't know where you’re going to live next, don't worry! We have programs that will ease your concerns.”
Building a successful career while navigating Silicon Valley’s tumultuous market history, Shannon knows what to expect from a fast-growing market. Her career began in 2004, just as the US housing bubble was reaching its peak—and she watched the bubble burst from the front lines just three years later. Those back-to-back market extremes gave her a deep understanding of how to navigate dramatic changes in the residential real estate market.
One of the keys to being successful in a competitive market is knowing which tasks need to be done early in order to attract strong offers. “Getting inspections done and writing disclosures in advance will reduce the need for further negotiating after a seller is in contract with a buyer,” says Shannon. “We still want the buyer to have their full rights to investigations, but it certainly can ease their minds knowing that we already have reports from certified inspectors who were hired to thoroughly evaluate the property before we even put it on the market.”
Shannon recommends that buyers leverage Proposition 19 to port their tax basis to a new San Diego home, now that it’s possible for California homeowners to move anywhere in the state at—or near—their current tax rate.
“San Diego has always been a beautiful, sunny, great weather, tons-of-things-to-do kind of place,” says Shannon. “And it’s a lot less expensive than places like Orange County, Silicon Valley, and the greater Bay Area. It’s a great place to retreat to or live full-time. It’s still affordable and has great lifestyle benefits.”
Her advice for buyer success is to pay attention to contingencies: the key is to reduce the number of ways a transaction can be canceled. Buyers have to be ready to compete on multiple fronts, including proving the ability to pay back a mortgage. “Interview lenders and get a pre-approval underwritten before writing any offers,” she says. “This way you can write a strong loan contingency. Sellers love short loan contingencies, and proving that a buyer can make good on their offer will go a long way.
“And buyers should review property disclosures before writing an offer,” she adds. “Knowing the little details of a home—and understanding what may need to be fixed—helps buyers write informed offers, and can prevent new contingencies from springing up after the inspection.”
To learn more or to enlist Rose Group to help you sell your San Diego County home, visit RoseGroupRE.com.
REALTOR®, CDRE, CLHMS, SRES, CDPE
About Rose Group/KW Bay Area Estates:
Rose Group, with KW Bay Area Estates, is a trusted real estate team focused on providing a smooth transactional experience to home buyers and sellers throughout the Bay Area and across the U.S. Comprised of exceptional agents and a dynamic support staff, Rose Group is equipped to manage all transaction types including residential sales, divorce real estate, investment property analysis, professional marketing, 1031 Exchanges, pre-foreclosure counseling, and short sales. For more information, visit Rose Group online at RoseGroupRE.com. DRE# 01526679.
Earlier this year, many economists and market analysts were predicting an apocalyptic financial downturn that would potentially rattle the U.S. economy for years to come. They immediately started to compare it to the Great Depression of a century ago. Six months later, the economy is still trying to stabilize, but it is evident that the country will not face the total devastation projected by some. As we continue to battle the pandemic, forecasts are now being revised upward. The Wall Street Journal (WSJ) just reported:
“The U.S. economy and labor market are recovering from the coronavirus-related downturn more quickly than previously expected, economists said in a monthly survey.
Business and academic economists polled by The Wall Street Journal expect gross domestic product to increase at an annualized rate of 23.9% in the third quarter. That is up sharply from an expectation of an 18.3% growth rate in the previous survey.”
Economists have historically cast economic recoveries in the form of one of four letters – V, U, W, or L.
A V-shaped recovery is all about the speed of the recovery. This quick recovery is treated as the best-case scenario for any economy that enters a recession. NOTE: Economists are now also using a new term for this type of recovery called the “Nike Swoosh.” It is a form of the V-shape that may take several months to recover, thus resembling the Nike Swoosh logo.
A U-shaped recovery is when the economy experiences a sharp fall into a recession, like the V-shaped scenario. In this case, however, the economy remains depressed for a longer period of time, possibly several years, before growth starts to pick back up again.
A W-shaped recovery can look like an economy is undergoing a V-shaped recovery until it plunges into a second, often smaller, contraction before fully recovering to pre-recession levels.
An L-shaped recovery is seen as the worst-case scenario. Although the economy returns to growth, it is at a much lower base than pre-recession levels, which means it takes significantly longer to fully recover.
Many experts predicted that this would be a dreaded L-shaped recovery, like the 2008 recession that followed the housing market collapse. Fortunately, that does not seem to be the case.
The same WSJ survey mentioned above asked the economists which letter this recovery will most resemble. Here are the results:
It’s difficult to speak positively about a jobs report that shows millions of Americans are still out of work. However, when we compare it to many forecasts from earlier this year, the numbers are much better than most experts expected. There was talk of numbers that would rival the Great Depression when the nation suffered through four consecutive years of unemployment over 20%.
The first report after the 2020 shutdown did show a 14.7% unemployment rate, but much to the surprise of many analysts, the rate has decreased each of the last three months and is now in the single digits (8.4%).
Economist Jason Furman, Professor at Harvard University's John F. Kennedy School of Government and the Chair of the Council of Economic Advisers during the previous administration, recently put it into context:
“An unemployment rate of 8.4% is much lower than most anyone would have thought it a few months ago. It is still a bad recession but not a historically unprecedented event or one we need to go back to the Great Depression for comparison.”
The economists surveyed by the WSJ also forecasted unemployment rates going forward:
The following table shows how the current employment situation compares to other major disruptions in our economy:
The economic recovery still has a long way to go. So far, we are doing much better than most thought would be possible.
Real estate continues to be called the ‘bright spot’ in the current economy, but there’s one thing that may hold the housing market back from achieving its full potential this year: the lack of homes for sale.
Buyers are actively searching for and purchasing homes, looking to capitalize on today’s historically low interest rates, but there just aren’t enough houses for sale to meet that growing need. Sam Khater, Chief Economist at Freddie Mac, explains:
“Mortgage rates have hit another record low due to a late summer slowdown in the economic recovery…These low rates have ignited robust purchase demand activity…However, heading into the fall it will be difficult to sustain the growth momentum in purchases because the lack of supply is already exhibiting a constraint on sales activity.”
According to the National Association of Realtors (NAR), right now, unsold inventory sits at a 3.1-month supply at the current sales pace. To have a balanced market where there are enough homes for sale to meet buyer demand, the market needs inventory for 6 months. Today, we’re nowhere near where that number needs to be. If the trend continues, it will get even harder to find homes to purchase this fall, and that may slow down potential buyers. Danielle Hale, Chief Economist at realtor.com, notes:
“The overall lack of sustained new listings growth could put a dent in fall home sales despite high interest from home shoppers, because new listings are key to home sales.”
The realtor.com Weekly Recovery Report keeps an eye on the number of listings coming into the market (houses available for sale) and the total number of listings staying in the market compared to the previous year (See graph below):Buyers are clearly scooping up homes faster than they’re being put up for sale. The number of total listings (the orange line) continues to decline even as new listings (the blue line) are coming to the market. Why? Javier Vivas, Director of Economic Research at realtor.com, notes:
“The post-pandemic period has brought a record number of homebuyers back into the market, but it’s also failed to bring a consistent number of sellers back. Homes are selling faster, and sales are still on an upward trend, but rapidly disappearing inventory also means more home shoppers are being priced out. If we don’t see material improvement to supply in the next few weeks, we could see the number of transactions begin to dwindle again even as the lineup of buyers continues to grow.”
Yes. If you’re thinking about selling your house, this fall is a great time to make it happen. There are plenty of buyers looking for homes to purchase because they want to take advantage of low interest rates. Realtors are also reporting an average of 3 offers per house and an increase in bidding wars, meaning the demand is there and the opportunity to sell for the most favorable terms is in your favor as a seller.
If you’re considering selling your house, this is the perfect time to connect so we can talk about how you can benefit from the market trends in our local area.
How long have you lived in your current home? If it’s been a while, you may be thinking about moving. According to the latest Profile of Home Buyers and Sellers by the National Association of Realtors (NAR), in 2019, homeowners were living in their homes for an average of 10 years. That’s a long time to be in one place, considering the average length of time homeowners used to stay put hovered closer to 6 years.
With today’s changing homebuyer needs, especially given how the current health crisis has altered our daily lifestyles, many homeowners are reconsidering where they’re at and thinking about moving to a home with more space for their families. Here’s why it might be a great time to make that happen.
The real estate market has changed in many ways over the past 10 years, and current homeowners are earning much more equity today than they used to have. According to CoreLogic, in the first quarter of 2020 alone, the average homeowner gained approximately $9,600 in equity. If you’re considering selling your house right now, you may have accumulated more equity to put toward a move than you realize.
Dialing back 10 years, many homeowners also locked in a fairly low mortgage rate. In 2010, the average rate was only 4.09%. This motivated homeowners to stay in their houses longer than usual to keep their rate low, rather than moving. Just last Thursday, however, average mortgage rates hit a new historic low at 2.86%. Sam Khater, Chief Economist at Freddie Mac explains:
“Mortgage rates have hit another record low due to a late summer slowdown in the economic recovery…These low rates have ignited robust purchase demand activity, which is up twenty-five percent from a year ago and has been growing at double digit rates for four consecutive months.”
Ten years ago, we couldn’t have imagined a mortgage rate under 3%. Looking at the math today, making a move into a new home and locking in a significantly lower rate than you have now could save you greatly on a monthly basis, and over the life of your loan (See chart below):As the example shows, you can save a substantial amount every month if you qualify for today’s low mortgage rate, and the savings can really add up over the life of a 30-year fixed-rate loan.
As a homeowner, you have a huge opportunity to move up right now. Whether you want to save more each month or get more home for your money based on your family’s changing needs, it’s a great time to connect to discuss the market in our area. Buyers are actively looking for more homes to buy, and you can win big by making a move if the time is right for you.
The year 2020 will be remembered as one of the most challenging times of our lives. A worldwide pandemic, a recession causing historic unemployment, and a level of social unrest perhaps never seen before have all changed the way we live. Only the real estate market seems to be unaffected, as a new forecast projects there may be more homes purchased this year than last year.
As we come to the end of this tumultuous year, we’re preparing for perhaps the most contentious presidential election of the century. Today, it’s important to look at the impact past presidential election years have had on the real estate market.
BTIG, a research and analysis company, looked at new home sales from 1963 through 2019 in their report titled One House, Two House, Red House, Blue House. They noted that in non-presidential years, there is a -9.8% decrease in November compared to October. This is the normal seasonality of the market, with a slowdown in activity that’s usually seen in fall and winter.
However, it also revealed that in presidential election years, the typical drop increases to -15%. The report explains why:
“This may indicate that potential homebuyers may become more cautious in the face of national election uncertainty.”
No. BTIG determined:
“This caution is temporary, and ultimately results in deferred sales, as the economy, jobs, interest rates and consumer confidence all have far more meaningful roles in the home purchase decision than a Presidential election result in the months that follow.”
In a separate study done by Meyers Research & Zonda, Ali Wolf, Chief Economist, agrees that those purchases are just delayed until after the election:
“History suggests that the slowdown is largely concentrated in the month of November. In fact, the year after a presidential election is the best of the four-year cycle. This suggests that demand for new housing is not lost because of election uncertainty, rather it gets pushed out to the following year.”
To some degree, but not in the overall number of home sales. As mentioned above, consumer confidence plays a significant role in a family’s desire to buy a home. How may consumer confidence impact the housing market post-election? The BTIG report covered that as well:
“A change in administration might benefit trailing blue county housing dynamics. The re-election of President Trump could continue to propel red county outperformance.”
Again, overall sales should not be impacted in a significant way.
If mortgage rates remain near all-time lows, the economy continues to recover, and unemployment continues to decrease, the real estate market should remain strong up to and past the election.
When most of us begin searching for a home, we naturally start by looking at the price. It’s important, however, to closely consider what else impacts the purchase. It’s not just the price of the house that matters, but the overall cost in the long run. Today, that’s largely impacted by low mortgage rates. Low rates are actually making homes more affordable now than at any time since 2016, and here’s why.
Today’s low rates are off-setting rising home prices because it’s less expensive to borrow money. In essence, purchasing a home while mortgage rates are this low may save you significantly over the life of your home loan.
Taking a look at the graph below with data sourced from the National Association of Realtors (NAR), the higher the bars rise, the more affordable homes are. The orange bars represent the period of time when homes were most affordable, but that’s also reflective of when the housing bubble burst. At that time, distressed properties, like foreclosures and short sales, dominated the market. That’s a drastically different environment than what we have in the housing market now.
The green bar represents today’s market. It shows that homes truly are more affordable than they have been in years, and much more so than they were in the normal market that led up to the housing crash. Low mortgage rates are a big differentiator driving this affordability.
Experts agree that this unique moment in time is making homes incredibly affordable for buyers.
Lawrence Yun, Chief Economist, NAR:
“Although housing prices have consistently moved higher, when the favorable mortgage rates are factored in, an overall home purchase was more affordable in 2020’s second quarter compared to one year ago.”
Bill Banfield, EVP of Capital Markets, Quicken Loans:
“No matter what you’re looking for, this is a great time to buy since the current low interest rates can stretch your spending power.”
“Those shopping for a home can afford 10 percent more home than they could have one year ago while keeping their monthly payment unchanged. This translates into nearly $32,000 more buying power.”
“Homeowners are the clear winners. Low mortgage rates mean the cost of owning is at historically low levels and who gains all the benefits of strong house price appreciation? Homeowners.”
When purchasing a home, it’s important to think about the overall cost, not just the price of the house. Homes on your wish list may be more affordable today than you think. Let’s connect to discuss how affordability plays a role in our local market, and your long-term homeownership goals.
As remote work continues on for many businesses and Americans weigh the risks of being in densely populated areas, will more people start to move out of bigger cities? Spending extra time at home and dreaming of more indoor and outdoor space is certainly sparking some interest among homebuyers. Early data shows an initial trend in this direction of moving from urban to suburban communities, but the question is: will the trend continue?
According to recent data from Zillow, there is a current surge in urban high-end listings in some larger metro areas. The month-over-month increase in these homes going on the market indicates more urban homeowners may be ready to make a move out of the city, particularly at the upper end of the market (See graph below):
With the ongoing health crisis, it’s no surprise that many people are starting to consider this shift. A July survey from HomeLight notes the top reasons people are actually moving today:
More space, proximity to fewer people, and a desire to own at a more affordable price point are highly desirable features in this new era, so the list makes sense.
John Burns Consulting notes:
“The trend is accelerating faster than anyone could have predicted. The need for more space is driving suburban migration.”
In addition, Sheryl Palmer, CEO of Taylor Morrison, a home building company, indicates:
“Most recently, we’re really seeing a pickup in folks saying they want more rural or suburban locations. Initially, there was a lot of talk about that, but it’s really coming through our buyers today.”
The National Association of Home Builders (NAHB) also shares:
“New home demand is improving in lower density markets, including small metro areas, rural markets and large metro exurbs, as people seek out larger homes and anticipate more flexibility for telework in the years ahead. Flight to the suburbs is real.”
The question remains, will this interest in suburban and rural living continue? Some, like Lawrence Yun, Chief Economist at the National Association of Realtors (NAR) think the possibility is there, but it is still quite early to tell for sure. Yun notes:
“Homebuyers considering a move to the suburbs is a growing possibility after a decade of urban downtown revival…Greater work-from-home options and flexibility will likely remain beyond the virus and any forthcoming vaccine.”
While much of the energy behind this trend has largely been accelerated by the current health crisis, monitoring the momentum over time is critically important. Businesses are discovering new and innovative ways to function in remote environments, so the shift has the potential to stick. Much like the economic recovery, however, the long-term impact may hinge largely on the health situation throughout this country.
Early data is showing a shift from urban to suburban markets, but keeping an eye on this trend will help us understand how it will ultimately play out. It may just be a temporary swing in a new direction until Americans once again feel a sense of comfort in the cities they’ve grown to love.