The housing market can change quickly, and a customer’s decision to sell or buy must be made fast if they miss a great opportunity. Some indicators will allow you to know where the market stands. These indicators may tell you if the market leans in favor of the buyer or the seller more. By monitoring this, you can better predict how the housing market will be for an extended period which will allow you more time in deciding to either buy or sell your house.
Housing Sales
There are seasons where more people are selling their homes. For example, there may be a rise in homes available to buy in the spring or summer, but there are also indexes that show you how quickly houses are being sold in a given area. Monitoring the rate at which homes are sold over time can give you a clearer picture of the market’s competitiveness. The more competitive the market, the more opportune it is for sellers to be selling their homes. If houses are being sold faster, a potential buyer may be more inclined to put a higher price for that given home into their offer. When competition is lower, there is more room for negotiation, while high competition leads to higher prices with little time to negotiate.
Housing Prices
Listing sites can disclose the previous buying price of a given home and a prior picture of the state of that home. You are seeing the home state before the current listing allows you to see the growth in value over a given amount of time and assess its worth in the future more accurately. You can use the previous listing prices to ensure you are not paying too much for the house at its current listing price. This also allows you to evaluate possible renovations to increase the home’s value more significantly.
Availability of Homes
The eviction moratorium allows people to stay in their homes even if they cannot make their mortgage payments. This, in turn, decreases the number of houses that are available in the market and results in increased competition for the available homes. Currently, Washington is experiencing quite a lot of this. As a result, many people are opting to sell their house to a high bidder, but buying a home is extremely difficult without paying more than what you would like to get for the house when you go to sell it. Many people are instead choosing to refinance their home to stay in it longer at a lower interest rate until they can buy their next house at an affordable price. This is only putting more limits on the homes available and will continue a more competitive market for longer.
Building a Home
As we continue to explore options in which potential buyers are taken to meet their home shopping needs. Land prices are always a good investment as they continue to rise in price each year. The land is not so readily available so naturally there is a higher competition level. But as we are experiencing in 2022, that is not the only hurdle for buying land a building a house. Lumber has become incredibly expensive. A single 2×4 was recorded two years ago to be $1.98, and today it is close to $6.00 that is over a 300% mark up in just two years. Many factors could be affecting this rise in lumber prices. Due to COVID-19 and now the hiring crisis, there are not enough workers in the mills to make more wood accessible. Another is a reallocation of the wood in a trade deal with other countries. It could be a combination of everything.
With the prices to build being so high, many in the middle of construction have had to postpone their projects, and not as many people are buying land until they can build. But if you have been following our trends, you know that fewer people purchasing land due to the challenge to build may make the price of the land may come down and leave more room for negotiation.
Everyone has their own needs and their unique situation. There is still so much unknown ahead in the housing market, but these are indicators that could help predict the changing trends. If you have any additional questions, reach out to us by clicking here.