Real Estate Trends
What’s the reason? Well, part of the slowdown is due to increased mortgage interest rates and another part is because of overall economic uncertainty. That combination is enough to discourage many buyers who are on the fence about purchasing a home.
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But there are still eager buyers in the market, and many of them are looking for newly built homes. In fact, new home construction is projected to increase by 8% in 2019.(2) That’s the good news. Here’s the bad news: There just aren’t enough new homes to go around in some areas. Plus, construction companies also don’t have the manpower to keep up with demand.
What’s the bottom line? Expect the new construction that is available to go for a higher price.
What Higher Prices Mean for Sellers
A nice profit may be on the horizon! The number of homes sold next year is still expected to rise, even if it’s at a slow pace. That’s great news for sellers! But keep in mind that a lot of buyers are being priced out of the market, which could lead to fewer offers for your home.
So what should you do about this? Be aware of your competition. With less offers to go around, you want your home to really stand out from similar ones in your area. Prepare your home for potential home buyers and work with a real estate agent to help you list your home at the right price.
And be sure to wait for the right offer. Some buyers may try to gut punch you with a low number. If you aren’t in a hurry to move, wait for an offer that gives you the most profit. Remember, the less desperate person always has the upper hand when negotiating!
What Higher Prices Mean for Buyers
If you’re going to buy a home in this expensive market, you absolutely must find out how much house you can really afford. Crunch the numbers yourself with our free mortgage calculator and figure out a monthly payment your budget can handle.
Commit to staying within that budget amount. Don’t rush into a home purchase that doesn’t make financial sense for you no matter how much pressure you feel watching competitors pluck good homes off the market. You could screw up your finances!
If you can’t put down at least 10% on a 15-year fixed-rate conventional loan, then you probably can’t afford a house in this market. A down payment that’s less than 10% will strangle your budget with massive monthly mortgage payments. But if you want to get prepared to buy and you’re committed to your budget, here are some options to consider: