Given the lack of available inventory and the many people looking to buy a home, today's housing market can be tough for a buyer entering the market. As we enter the end of the year housing market buyers are asking, "Should I delay my buying decision until 2018?"
The MA Properties Online Team recommends: NOT TO WAIT
Here's why: The primary reason most buyers delay their home search is because they say to themselves, "Next year will be better".
Better means some combination of:
Every Realtor® in Greater Boston knows there is a large number of potential home sellers, many of whom will either become buyers of more expensive homes or will look to downsize to smaller homes. But many of these potential sellers are delaying selling because they don't think they have sufficient equity in their homes. On the other hand, home prices have risen steadily in many towns over the last few years and even people who bought a home in 2005/2007 now have homes with significant equity in them.
The following charts show we will see more sellers entering the market. It may, however, take a few more years for the level of homes available for sale to rise to the point where we have a balanced market of an approximately 6 month home supply.
It's not universally the case as the data for Sudbury shows:
So, we will see more seller's entering the market but it may take a few more years for the level to rise to the point where we have a balanced market (which is defined as approx 6 months home supply). As the Newton data shows we're still not at this balanced state.
Every report we read says there are a large number of "millennials" (those born between the early 1980s to the early 2000s) who are either looking to stop renting or are looking to move up from the 2-bedroom condominiums they bought a few years ago to take advantage of low prices, low mortgage rates, and government tax breaks. These reports indicate there will be an increase in the number of buyers in 2018.
The charts above show that prices have been increasing for many years in the stronger markets and the data show that this home price increase is now also occurring in the less strong markets as well. In some markets the rate of increase is arguably unsustainable but the data still show that overall nation-wide prices are still 16% lower than the highs of 2006/7. MA Properties Online along with the other analysts who track the national trends do not see a decrease in housing prices any time soon.
This graph shows a range of opinions on cumulative price increases over the next 4 years:
This next graphic shows that mortgage rates are expected to rise in 2018.
Also, we have seen a slight reduction in the FICO Credit Score requirements to get a mortgage.
In conclusion our analysis shows that in 2018:
Should you therefore delay?
Delaying the purchase of your home could result in increased home prices, higher mortgage rates, and increased competition with a growing pool of buyers. We recommend you continue to look as the right home in the right location at the right price may be there.
The MA Properties Online Team knows it's not just about buying a home it's about buying the RIGHT home. Our focus on information using real estate statistics and quality information while working closely with our buyers to understand their needs and wants means that buyers who work with our team make the right choices. As a seller, the information we provide the potential buyers of your home will make a difference in the final sale price.
If you would like an estimate of what your home would sell for in today's market I would be more than happy to come by, have a look at your home, and then provide a CMA (comparative market analysis) which will provide you with an estimate of what your home should sell for, along with a marketing plan to get maximum exposure for your home.
If you'd like to chat more about the topic presented here, or the Real Estate market in general, then please call me on (617) 997 9145, or email me at Dani.Fleming@MAPropertiesOnline.com.