House market: why did it change so fast?

 

Been a busy week again, listings that I have are selling so quicker and multiple bids happening now. How did we get here, the market for sure has now broken out of those dead doldrums and is on its way to a real sellers market with rising prices for home owners. For many, that is a cause for celebration.

Some are worried though!!! colleagues in the industry are concerned as to how fast and quick the prices rose, could this be interest rates or is the Federal Reserve’s campaign to reduce interest rates giving the housing market a false high.

Given and released data as to existing home prices showed a rise of 10% in February nationally as from a year ago. Also they have been quoted as rising during the slow winter months too this I have seen. Even now we are seeing prices jump still further as spring buying is getting underway.

          As I have said before "we do not have enough houses to sell, buyers are crawling over me everyday looking for homes" also inventory of homes for sale is quoted as falling to a 20 year low.

Another factor is there are not many new homes coming on either we are seeing builders break ground again and get underway, nice to see but its not enough and are still lower than 2008.

Investors, I see are buying and then putting them out to the market as rentals.

Foreclosures in my opinion are not as profitable as people may think anymore and therefore bank sales of foreclosures are also slowing.

Demand is there due to a still low interest rate and for sure starters as first time buyers are getting on the ladder due to rising rent prices.

Through any recession parts of a market will continue due to things like relocation, sadly divorce and death, down sizing or having to grow due to needs it still goes on. People want to buy who are renters to get going on the home ladder again. So now after all that going and a market pushing up in buyers wanting property demand is higher than the housing stock we have.

The feeling and conversations I have with clients, financial execs and colleagues is that we waited for the second wave of foreclosures it didn't really come, interest rates rising prices rising...general great feeling to the market.

So in my opinion all of this points to soaring prices for sure if it remains.

It feels like semi bubble but i don't think it is, home prices are still affordable based on monthly percentage of salaries.

The conclusion:

Investors, low housing stock, renters moving into buying and low interest rates are moving it up!

I meet investors i don't have to tell them to buy now, they know it! but to the average person it comes more nervous to selling their homes, they say "the market moves every 17 years" to quote, Jim Weichert founder of Weichert Realtors. He usually is never wrong in his observations in seeing the true market. Like him I advise you to buy as tomorrow its going to cost more bubble or no bubble and sell with the correct marketing to gain the best value for your home at this booming market time.