As Temperatures Rise, the Housing Market Starts to Cool
Whether you’re a seller, agent, or buyer, you’ll keep your head (and finances) above water this season by setting reasonable expectations and adapting to the housing market’s changing tides this summer. And luckily, housing market forecasts aren’t as stormy as most of us anticipate.
Weathering stormier housing market trends this season
Have you ever prepared for a category five hurricane that turned out to be no more than a moody summer squall? The summer housing market will play out similarly. While many sellers and buyers are anxious about upending gale winds, the reality will be less threatening. Plan to navigate the choppy seas of the current economy with a few painless yet critical shifts in priorities. Let’s dive deeper into the insights and solutions to this summer’s market conditions.
The home buyers’ conundrum: high-interest rates present new challenges
The inflation rate, last reported at 8.6% in May, is at its highest since 1981. Consumers face increased living costs, from everyday purchases to luxury items and milestone investments like cars and homes. In response, the Central Bank propelled standard 30-year fixed mortgage rates above 5%, from 2.96% in 2021.
For home buyers, that means:
Monthly mortgage costs will increase (to the tune of hundreds or thousands of dollars, depending on the home price, down payment amount, and exact interest rate of the mortgage agreement)
It will take longer to pay mortgages off
Interest costs will increase over the entire life of loans
Demand for mortgages is nearly half what it was, according to CNBC. Many home buyers must reconsider their budgets and borrow less. It’s not an entirely sunny forecast, but there are silver linings: buyers who pre-qualify for mortgages now have more time and options. They’re competing with fewer people, so bidding wars are less likely to drive up listing prices. As a result, inventory is starting to grow.
Inventory and average listing times will grow, but sellers, keep calm!
The market continues to favor sellers because, as The New York Times asserted recently, “inventory is still low, and there are more people who want homes than there are homes to buy. Although inventory of active listings increased by almost 19% in June from a year ago, it is still down by 53.2% from 2019, according to Realtor.com.”
If you’re a buyer:You’ll find less competition this season than earlier this year. At the same time, mortgages are less attainable and affordable. If you’re shopping for a home this summer, you’ll have more homes to choose from in a less hurried marketplace.
If you’re a seller: Remember, the summer real estate market is strong, even if it’s not record-breaking hot anymore. List your home sooner than later, before competition becomes steeper this fall. Don’t be discouraged; scores of hopeful buyers will still take an interest in your home. Your pre-listing plan should focus on making updates to ensure that your home stands out amongst other listings in your area. It’s now more important than ever to enhance your property’s curb appeal and livability. Work with Curbio to manage all your home improvements for the easiest, most affordable experience. We’ll determine the projects that make your home most sellable and then manage every detail of your upgrades. Best yet, we only bill you once your home sells. When your listing goes live, be confident and patient.
If you’re an agent: Quality is everything. Encourage your clients to make their homes irresistible with strategic updates to enhance prices and shorten listing times. Curbio can make this job more manageable. From simple tasks like painting, staging, and landscaping to extensive renovations, Curbio will prioritize and execute your home improvement projects. You won’t have to worry about a thing, and your client only pays a fixed fee after the sale is complete.
Homeowners’ equity grows, even in chillier housing market conditions
Real estate trends from the last several years saw record-breaking profits. CNBC reported the average yield on home sales in 2021 “was just over $94,000, an increase of 45% from the profit in 2020 and 71% from pre-pandemic profits. The amount of tappable equity (equity above the 20% usually required by lenders to back a mortgage) grew by $2.6 trillion last year to a record total of $9.9 trillion.”
The rising prices and lightning speed from listing to closing are predicted to lose momentum through the summer but not dramatically for sellers who invest in making their homes attractive and livable.
Keep your listing hot with affordable home renovation solutions
How should homeowners and real estate agents interested in selling a home this summer respond to the shifting market conditions? Stay competitive by ensuring that your home meets buyers’ needs.
Most Americans in the market for a house prefer move-in-ready homes over ones that require repair and construction. An attractive, updated property will do wonders in stormier market conditions.
Sellers who invest in repairs, remodeling, and enhancing curb appeal before listing their homes reap the most rewards. If presale cash flow is an issue, entrust your home renovations with Curbio’s fixed-fee, “pay-when-you-sell” financial model.
The best strategies for selling or buying in this summer’s housing market
Enhance your home with flexible spaces
Homeowners and buyers are utilizing living spaces differently since the pandemic, customizing rooms for a variety of activities like working, exercising, gaming, and playing music. Sellers will draw interest by staging extra areas like living rooms, dens, basements, or sunrooms to highlight how the home will fit buyers’ needs.
Power Buyer Programs
Power buyers offer cash backing or buy-before-you-sell services, and often have sale-leaseback and rent-to-own options. Essentially, they eliminate barriers to purchase, including appraisal gaps.
For Buyers: Power buyers empower buyers. Specifically, power buyers can help level the playing field as buyers compete against all-cash offers from investors and wealthier purchasers. Cash backing and other power buyer programs create access to homeownership for many buyers.
For Sellers: Commonly, homeowners worry their homes may sell before finding their next properties. Power buyers create more ease in the selling and buying process, so you can purchase your next home before you sell the one you own.
For Agents: Power buyers help you provide more options and services to buyers and sellers, give your clients more control, and level the playing field.
A real estate concierge is generally understood to be a pre-listing service that helps sellers make improvements to homes before putting them on the market and often include financial assistance for specific upgrades or staging costs to ensure properties appeal to a broad set of buyers and sell for a higher price.
With Curbio, real estate moves faster
Dedicated, licensed Home Improvement Consultants make it easy to accomplish home improvements that add value for buyers. Our process reaches completion 50% faster than the average general contractor and the updates sell faster, and for more. In fact, homes that update with Curbio profit the homeowner an average of $80,000. With deferred payment (no interest, no fees) more homeowners are able to extract maximum equity in their home without navigating upfront project costs.
3D Video Tours
3D video tours boost digital curb appeal and move real estate faster. In 2021, 95% of home buyers used the internet during their home buying journey and 41% looked at properties online as the first step in their process. Generating buzz with your listing, before buyers visit your home in person, is a proven success strategy.
For buyers: 3D tours help you self-select properties that fit your needs, so you’ll only step foot in the homes most likely to resonate with you.
For sellers: Give buyers a sense of your home’s layout and charm. 3D tours offer a more vivid picture than standard photos and give prospective buyers a better understanding of your property who want to see your property in person.
For agents:High-quality photos and 3D tours elevate listings, get you more views, and save you time. It allows viewers to visualize properties and in turn reduces showing requests to serious buyers.
This summer, kick it to Curbio.
Let us help you weather the summer’s economic climate and housing market trends. With turnkey solutions that range from minor fixes to drastic renovations, kick it to Curbio to manage your home renovation projects. Start here.