There are many stages in life where the mindset of temporary housing or a rental phase makes sense. There are many different stages of life where temporary housing may make sense: college students who want to live on their own without paying full price; people who are new to an area and want to learn more about an area before they buy; and younger people whose finances have just started taking off. However, in our current economic environment, these people are more focused on buying homes, thus increasing the number of buyers competing for homes in the real estate market in Rogers. This shift in demand for permanent housing may be partly due to many companies shifting their business model to allow for more home-based work. As people spend more and more time at home, they want a place they own so they can customize it as they wish. They also know that they may not have to relocate if they change employers as they may be able to work remotely with a new employer.
Riding the Wave
The effects of the Great Recession are still rolling through the housing market. Housing starts have yet to recover to the levels seen in the early 2000s. This has created a backlog of demand, especially felt since the pandemic. Historically low mortgage interest rates are being used by many buyers to purchase houses who may not have been able to afford them otherwise. This is pushing the market even more. Buyers have also been migrating from high-tax states to lower-tax states – think coasts vs. midwest and southeast for the most part.
There have rarely been fewer homes for sale than there are in today’s market. Inventory of homes for sale has been reported to be as low as a two-month supply compared to a “normal” six-month supply. Sellers who would typically be looking for a “move-up” home have also slowed down on their selling. The challenge becomes, if they sell their house they are in today, where will they move to? Many homeowners choose to stay in place to see how the market settles out before risking what they have in place. The housing market is currently an epic seller’s market, as the surge in demand and shortage of available units has caused prices to soar.
The Trouble With Bidding Wars
A seller’s market, while sounding like an ideal scenario for home sellers, actually has its drawbacks. The bidding wars that take place in this type of housing marketplace can cause prices to skyrocket which may not be something desirable by everyone looking to buy or sell their homes. One problem can be buyers bidding above the value that a home will appraise. When this happens, your buyer may find themselves in a situation where they need to bring more cash to closing than they had planned, since lenders will only loan based on the appraised value. This may cause your buyers to either walk away or attempt to renegotiate, and you may wind up selling for less than you had planned.
What Goes Up Must Come Down
As the saying goes, all good things come to an end. Housing prices had already begun to trend upward before the pandemic and have continued to rise. This rapid jump in pricing has caused many would-be home buyers to not be able to afford a house. The question becomes, how long does this price run-up continue? Do people decide they will stay put for a while and see if the market cools? Foreclosures are on hold now, but indicators show that they will likely rise, especially among lower-income households. Around 2.7 million mortgages are in forbearance – over 5% of all mortgage-holders – meaning the borrower is not currently making payments. These mortgages will wind up in foreclosure unless the homeowner is able to recover economically and begin payments under the terms of their loan at the end of the forbearance period.
Avoiding the Risks of Selling
Many sellers will miss out on this historically hot seller’s market. By waiting too long, some will simply miss out on the frenzy. Many have delayed selling during the pandemic in order to avoid the risks of meeting with strangers or having buyers walk through their homes. With stress already at an all-time high for many, the mere thought of the additional pressures of selling a home, especially when school and work are home-based, is too much to consider. Rogers home sellers should know that there is another way to sell their home on the real estate market in Rogers, by selling to a direct buyer like Northwest Arkansas Home Buyer.
Ready to learn more about what Rogers home sellers should know about the real estate market in Rogers? At Northwest Arkansas Home Buyer, we are here to listen and help you handle all of your problems. With fair prices, straightforward easy to understand contracts, and quick closings. Working with Northwest Arkansas Home Buyer means there’s no need to delay selling any longer! Northwest Arkansas Home Buyer will walk you step by step through the process and help you determine what is best for you! Send us a message or call Northwest Arkansas Home Buyer at (479) 802-0854 today!