The spring tends to be real estate’s most active season of buying and selling. So what housing trends are emerging right now that you should be aware of? The Street recently took a look at three trends it sees as getting bigger this spring:
1. Inventories are favoring the seller. With a limited number of homes for sale across the country, home sellers have the upper hand as home buyers are forced to compete for limited inventories. Inventories of less expensive “starter homes,” in particular have dropped, which is making it difficult for first-time buyers to break into the market. Home buyers need to be ready to take action fast when they see a home they want.
2. More buyers may consider a new home. Some home buyers may seek greater alternatives to limited inventories and consider building a home and buying new. Ralph McLaughlin, chief economist with Trulia, says there’s a 10-year high for homes being bought off of a plan alone. “Why? The inventory of existing homes continues to fall,” he notes. “Low existing inventory likely pushes prospective buyers away from existing homes toward new homes, and as new home sales rise, this allows builders to sell more new homes off of a plan.”
3. Buying is cheaper than renting. Seven in 10 respondents of a recent Freddie Mac survey believe it’s cheaper to pay rent than a monthly mortgage on a home. Saving for a down payment may a big hurdle for many. However, studies show that buying trumps renting in 98 of the 100 largest metros in the nation.
Source: “3 Real Estate Trends to Watch This Spring,” The Street (April 20, 2016)