Everyone loves to talk about real estate, at least those I know. They read or hear the news about how hot the market is and assume it’s a wonderful thing, but like most things, it’s in the eye of the beholder.
Sellers are doing quite well this year. Homes are selling faster. An average of 76 days on the market in the metro area. That’s down 12% from last year. The average sale price is up to $293,826 or 15.7% year over year. Demand for homes is sky high.
Buyers aren’t having as much fun as sellers. Lower inventory levels limit their choices and are driving prices up. So far, buyers have good purchasing power, thanks to low mortgage rates; presently below 3% for a 30 year loan, but when values go up so do payments. Buyers will start to lose interest when the percentage of their income for housing goes too high. Demand will diminish and home values will retreat.
There are some frustrated sellers too; those who want to move up but have nowhere to go at the moment. This can either stop them from selling or force them to make two moves or potentially owning more than one house.
The reason for the current market condition is plentiful. The dip in inventory is deeper than most cycles. Complications from Covid-19 lockdown has disrupted the natural market, and the government ‘fixes’ have made the situation worse. What we do know is real estate ownership in the Sioux Empire looks to be solid for a long time. Favorable economic and political environments are creating exceptional momentum for growth. Employment demand is up, wages are rising, and consumer confidence remains high. In addition, mortgage rates are expected to remain near the present level. Unfortunately, inflation is about to rear its ugly head. One of the best ways to protect one’s wealth is to be invested in hard assets such as real estate. Get in early and stay in.
Many people think real estate transactions are easy, but 95% of the time they are not. There are many moving parts plus high levels of emotions, requiring constant monitoring and finesse. Problem solving is a regular daily exercise. The Dream Home Process™ helps our clients maximize their dollars, save them valuable time, and deliver greater peace of mind as they maneuver through the maze.
We invite you to call or text 605.359.4100
Tony Ratchford, licensed Broker, Author, Coach, Manager, and Sales Consultant
