What Experts Project for Home Prices Over the Next 5 Years
What Experts Project for Home Prices Over the Next 5 Years If you're planning to buy a home, one thing to consider is what experts project home prices will do in the future and how that might affect your investment. While you may have seen negative news over the past year about home prices, they’re doing far better than expected and are rising across the country. And data shows, experts forecast home prices will keep appreciating. Experts Project Ongoing Appreciation Pulsenomics polled over 100 economists, investment strategists, and housing market analysts in the latest quarterly Home Price Expectation Survey (HPES). The results show what the panelists project will happen with home prices over the next five years. Here are those expert forecasts saying home prices will go up every year through 2027 (see graph below):If you’re someone who was worried home prices would fall because of stories you’ve read online, here's the big takeaway. Even though home prices vary by local market, experts project prices will continue to rise across the country for years to come. And these numbers indicate the return to more normal home price appreciation. And while the projected increase in 2024 isn’t as large as 2023, it’s important to recognize home price appreciation is cumulative. In other words, if these experts are correct, after your home’s value rises by 3.32% this year, it’ll appreciate by another 2.17% next year. This is a good example of why owning a home is a choice that wins big over time. What Does This Mean for You? Once you buy a home, price appreciation raises your home’s value, and that grows your household wealth. To see how a typical home's value could change in the next few years using the expert projections from the HPES, check out the graph below:In this example, let’s say you bought a $400,000 home at the beginning of this year. If you factor in the forecast from the HPES, you could potentially accumulate more than $71,000 in household wealth over the next five years. So, if you're thinking about whether buying a home is a good choice, remember how it can be a powerful way to grow your wealth in the long run. Bottom Line According to the experts, home prices are expected to grow over the next five years at a more normal pace. If you’re ready to become a homeowner, know that buying today can set you up for long-term success as home values (and your own net worth) grow. Let’s connect to start the homebuying process today.
Top 7 Tips To Attract the Best Offers for Your Home
Top 7 Tips To Attract the Best Offers for Your Home Not long ago, home sellers were in their heyday, as historically-low mortgage rates triggered a real estate buying frenzy. However, the Federal Reserve shut down the party when it began raising interest rates last year.1 Now, it’s not as simple to sell a home. While pandemic-era homebuyers were racing the clock—trying to lock in a low mortgage rate and gain a foothold in the market—current buyers are more discerning. Higher prices and mortgage rates have pushed their limits of affordability, leading them to prioritize cost, condition, and overall value.2 The reality is, home inventory remains low, so most properties will still sell with some basic prep, the right price, and a good real estate agent. But owners who go the extra mile are more likely to sell faster and for a higher amount. If you have plans to sell your home and want to net the most money possible, this list is for you. Here are our top seven strategies to attract the best offers and maximize your real estate returns. UNDERGO A PRE-LISTING INSPECTION Many homebuyers hire a professional to complete a home inspection before they close. But did you know that a seller can order their own inspection, known as a pre-listing inspection, before they put their home on the market? Having a pre-listing inspection on hand and ready to share shows interested buyers that you’re committed to a transparent transaction. This can help you market your home, strengthen your negotiating position, and minimize roadblocks to closing.3 Of course, it’s always possible that a pre-listing inspection—which looks at the home’s major systems and structures, among other things—could turn up a significant problem. This does carry some risk, as you’ll be required to either fix or disclose any issues to potential buyers. However, in most cases, it’s better to know about and address deficiencies upfront than to find out mid-transaction, when it could cost you more in the form of concessions, a delayed closing, or a canceled sale. We can help you decide if a pre-listing inspection is right for you. And if it identifies any concerns, we can advise on which items need attention before you list your home. 2. CONSIDER STRATEGIC UPGRADES Embarking on major renovations before putting your home on the market doesn’t always make financial (or logistical) sense. However, certain upgrades are more likely to pay off and can help elevate your home in the eyes of buyers. For example, refinishing hardwood floors results in an average 147% return on investment at resale and new garage doors typically pay for themselves.4 Similarly, research shows that professional landscaping can boost a home’s value by as much as 20%.5 Often, even simpler and less expensive fixes can make a big difference in how your home comes across to buyers. A fresh coat of paint in a neutral color, modern light fixtures and hardware, and new caulk around the tub or shower can help your property look its best.5 But before you make any changes to your home, reach out. We know what buyers in your neighborhood are looking for and can help you decide if a particular investment is worthwhile. 3. HIRE A HOME STAGER To get standout offers, you need potential buyers to fall in love with your home—and they’re much more likely to do so if they can envision themselves in the space. That’s where home staging comes in. Staging can include everything from decluttering and packing away personal items to bringing in neutral furniture and accessories for showings and open houses. According to the National Association of Realtors, home staging can both increase the dollar value of home offers and help a property sell faster. In fact, 53% of seller’s agents agree that staging decreases the amount of time a home spends on the market, and 44% of buyer’s agents see higher offers for staged homes.6 There’s plenty of strategy and research behind the process, so it’s smart to consider a professional. Reach out for a connection to one of our recommended home stagers who can help your property show its full potential. 4. EMPLOY A COMPETITIVE PRICING STRATEGY While it’s tempting to list your property at the highest possible price, that approach can backfire. Homes that are overpriced tend to sit on the market, which can drive away potential buyers—and drive down offers.7 Alternatively, if you price your home competitively, which is either at or slightly below market value, it can be among the nicest that buyers see within their budgets. This can ultimately lead to a higher sales price and fewer concessions. To help you list at the right price, we will do a comparative market analysis, or CMA. This integral piece of research will help us determine an ideal listing price based on the amount that comparable properties have recently sold for in your neighborhood. Without this data, you risk pricing your home too high (and getting no offers) or too low (and leaving money on the table). Combined with our local market insights, we’ll help you find that sweet spot that will attract the best offers while maximizing your profit margin. 5. OFFER BUYER INCENTIVES Sometimes, sweetening the deal with buyer incentives can help you get the best possible offer. Incentives are especially helpful in the current market, when many buyers are struggling with affordability and concerned about their monthly payments. Options that can pay off include: Buying down their interest rate – You can pay an upfront sum to reduce the buyer’s mortgage rate. This approach can save far more than that cost over the life of the loan, meaning it’s worth more to the buyer than a simple price reduction.8 Offering closing cost credits – You might pay a set amount or a certain percentage of the buyer’s closing costs. Paying HOA costs – You could cover homeowner association or condominium fees for a set period of time. Including furniture or appliances in the sale – If your buyer is interested, throwing in the furniture or appliances that they want and need can make your property more appealing. Buyer incentives vary and valuing them can get complicated. We’re happy to talk through the options that might make sense for you. 6. USE A PROVEN PROPERTY MARKETING PLAN Gone are the days when it was enough to put a “for sale” sign in your yard and place a listing on the MLS. A strategic marketing plan is now essential to get your home in front of as many interested and qualified buyers as possible. The truth is, buyers who don’t know about your house can’t make an offer. That’s why we utilize a multi-step approach to marketing that starts with identifying your target audience, effectively positioning your home in the market, and communicating its unique value. We then use a variety of distribution channels to connect with potential buyers and performance-based metrics to monitor and improve our campaign results. Our proven approach can have a big impact on the success of your sale. Reach out to learn more about our multi-step marketing plan and discuss how we can use it to generate interest and offers for your home. 7. WORK WITH AN AGENT WHO UNDERSTANDS YOUR AREA To get the best offers possible, you need a real estate agent who knows your area inside and out. Any agent can pull comparable sales data, but in a quickly-evolving market, even the latest comps can lag the current market reality. We have our fingers on the pulse of the local market because we’re working directly with sellers like you. We also represent local buyers who are active in the market, searching for homes like yours. That puts us in an ideal position to help you price your home for a quick sale and maximum profit. And since we hear first-hand what local buyers want, we can help you prep your home to broaden its appeal and highlight its most-coveted features. Additionally, we can use our extensive network of local agents to solicit feedback and get your home in front of more potential buyers. All of these factors can add up to a significant difference in your profit: In 2021, the typical home sold by owner went for $225,000 compared to a median price of $330,000 for agent-assisted home sales.9 LET’S GET MOVING Are you ready to get a great offer for your home? Our multifaceted approach can help you maximize your real estate returns. Reach out for a free home value assessment and customized sales plan to get started! The above references an opinion and is for informational purposes only. It is not intended to be financial, legal, or tax advice. Consult the appropriate professionals for advice regarding your individual needs. Sources: S. Bank - https://www.usbank.com/investing/financial-perspectives/investing-insights/interest-rates-impact-on-housing-market.html National Association of Realtors -https://www.nar.realtor/sites/default/files/documents/2023-home-buyers-and-sellers-generational-trends-report-03-28-2023.pdf Bankrate -https://www.bankrate.com/real-estate/prelisting-inspection/ National Association of Realtors -https://www.nar.realtor/sites/default/files/documents/2022-remodeling-impact-report-04-19-2022.pdf Bankrate -https://www.bankrate.com/homeownership/landscaping-increase-home-value/ National Association of Realtors -https://www.nar.realtor/infographics/staged-for-success The Balance -https://www.thebalancemoney.com/looking-twice-at-overpriced-homes-1798671 S. News & World Report -https://money.usnews.com/loans/mortgages/articles/a-guide-to-seller-paid-mortgage-rate-buydowns National Association of Realtors -https://www.nar.realtor/research-and-statistics/quick-real-estate-statistics
Buyer Traffic Is Still Stronger than the Norm
Buyer Traffic Is Still Stronger than the Norm Are you putting off selling your house because you’re worried no one’s buying because of where mortgage rates are? If so, know this: the latest data shows plenty of buyers are still out there, and they’re purchasing homes today. Here’s the data to prove it. The ShowingTime Showing Index is a measure of buyers touring homes. The graph below uses the latest numbers available and compares them to the same month in the last normal years to show just how active today’s buyers still are: As you can see, when June 2023 numbers are stacked alongside what’s typical for the housing market at this time of year, it's clear buyers are still active. And, they’re actually a lot more active than the norm. If you’re wondering how this could possibly be true, it’s because buyers are getting used to higher mortgage rates and accepting them as the new reality. As Danielle Hale, Chief Economist, Realtor.com, explains: “Interest rate hikes continue to further cut into buyers' purchasing power, although they appear to have adapted to the higher mortgage rate environment . . .” It’s simple. Buyers will always need to buy, and those who can afford to move at today’s rates are going to do so. The Key Takeaway for You While it’s true things have slowed down from the frenzy of the last couple of years, it doesn’t mean today’s market is at a standstill. The reality is: buyer traffic is still strong today. Even with today’s mortgage rates, plenty of buyers are still making their moves. So why delay your own move when there’s clearly a market for your house? Bottom Line Don’t put off your plans because you’re worried no one will buy your home. The opposite is true, and more buyers are more active than the norm. Let’s connect to get your house ready to sell, so it makes the best first impression possible on those eager buyers.
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