If you are hoping to buy a home, you may be aware of a current issue: There is a significant shortage of homes for sale. As a result, prices are high, homes are quickly flying off the market and sellers have the upper hand in negotiations.

 

The Current Demand for Homes

 

Growth in remote work and other lifestyle changes triggered by the pandemic have increased the demand for homes substantially. In fact, between June 2020 and June 2021, nationwide home prices increased by 17.2%.

 

Additionally, some individuals are finding themselves in a good financial situation. While the pandemic has brought hardship to many, 73% of customers said they saved money due to the stay-at-home orders and ongoing restrictions on travel. This fact combined with the currently low interest rates, many people find themselves able to buy a home, despite rising home prices.

 

Unfortunately, lumber shortages have reduced the amount of new construction. This has furthered the challenge for home buyers. However, new flexibility may allow you to consider locations you would not have had access to before, and the low interest rates may allow you to afford more house than you could.

 

Why Buy Rather Than Rent?

 

Another reason why homes are not staying on the market, is because the advantages of buying rather than continuing to rent remain solid. Consider:

  1. Owning a home is a form of forced saving. When you have paid off your mortgage you will have equity and will have made money. However, if you rent, that money is gone for good.
  2. Rent prices tend to rice more quickly than mortgages. Rent is shooting up, faster than median incomes in many markets. With a fixed rate mortgage instead, you can budget for those payments...and add more if you are financially comfortable.
  3. Interest rates remain historically low.
  4. Loan amounts on conforming loan programs have been increased to cover the rising house prices.
  5. Tax deductions remain helpful, even with changes to the tax code.

There is no shortage of a demand for homes and buying a home is still a good idea. However, the lack of supply is pervasive. Without the correct guidance in your corner, it may be a challenge to find the home you want.  

 

To ensure your real estate transaction occurs picture perfectly, contact Gail Rutkowski and Associates. We constantly ensure our clients come out on top, whether they are buying, or selling a home.