The housing market is at a turning point, and if you’re thinking of buying or selling a home, that may leave you wondering: is it still a good time to buy a home? Should I make a move this year? To help answer those questions, let’s turn to the experts for projections on what the second half of the year holds for residential real estate.

Where Mortgage Rates Will Go Depends on Inflation

While one of the big questions on all buyers’ minds is where will mortgage rates go in the months ahead, no one has a crystal ball to know exactly what’ll happen in the future. What housing market experts know for sure is that the record-low mortgage rates during the pandemic were an outlier, not the norm.

This year, rates have climbed over 2% due to the Federal Reserve’s response to rising inflation. If inflation continues to rise, it’s likely that mortgage rates will respond. Greg McBride, Chief Financial Analyst at Bankrate, explains it well:

“Until inflation peaks, mortgage rates won’t either. Without improvement on the inflation front, we don’t know where the interest rate ceiling will be.”

Whether you’re buying your first home or selling your current house to make a move, today’s mortgage rate is an important factor to consider. When rates rise, they impact affordability and your purchasing power. That’s why it’s crucial to work with a team of professionals, so you have expert advice to help you make an informed decision about your best move.

The Supply of Homes for Sale Projected To Continue Increasing

This year, particularly this spring, the number of homes for sale has grown. That’s partly due to more homeowners listing their houses, but also because higher mortgage rates have helped ease the intensity of buyer demand. Moderating buyer demand slows down the pace of home sales, which in turn helps inventory rise.

Experts say that growth will continue. Recently, realtor.com updated their 2022 inventory forecast. In the latest release, they increased their projections for inventory gains dramatically, going from a 0.3% increase at the beginning of the year to a 15.0% jump by the end of 2022 (see graph below):

More homes to choose from is great news if you’re craving more options for your home search – just know that there isn’t a sudden surplus of inventory on the horizon. Housing supply is still low, so you’ll need to partner with an agent to stay on top of what’s available in your market and move fast when you find the one. It’s not going to be easy to find a home, but it certainly won’t be as difficult as it has been over the past two years.

Home Price Forecasts Call for Ongoing Appreciation

Due to the imbalance between the number of homes for sale and the number of buyers looking to make a purchase, the pandemic led to record-breaking increases in home prices. According to CoreLogic, homes appreciated by 15% in 2021, and they’ve continued to rise this year.

Even though housing supply is increasing today, there are still more buyers than there are homes for sale, and that’s maintaining the upward pressure on home prices. That’s why experts are not calling for prices to decline, rather they’re forecasting they’ll continue to climb, just at a more moderate pace this year. On average, homes are projected to appreciate by about 8.5% in 2022 (see graph below):

Selma Hepp, Deputy Chief Economist at CoreLogic, explains why the housing market will see deceleration, but not depreciation, in prices:

“The current home price growth rate is unsustainable, and higher mortgage rates coupled with more inventory will lead to slower home price growth but unlikely declines in home prices.”

For current homeowners looking to sell, know your home’s value isn’t projected to fall, but waiting to make your purchase does mean your next home could cost more as home prices continue to appreciate. That’s why, if you’re thinking about buying your first home or you’re ready to make a move, it may make sense to do so now before prices climb higher. But rest assured, once you buy a home, that price appreciation will help grow the value of your investment.

Bottom Line

Whether you’re a homebuyer or seller, you need to know what’s happening in the housing market, so you can make the most informed decision possible. Connect with a real estate advisor to discuss your goals and what lies ahead, so you can determine the best plan for your move.

Source: Keeping Current Matters

Realty Executives Midwest
1310 Plainfield Rd. Ste 2 | Darien, IL 60561
Office: 630-969-8880
E-Mail: experts@realtyexecutives.com

Over the past few weeks, the average 30-year fixed mortgage rate from Freddie Mac fell by half a percent. The drop happened over concerns about a potential recession. And since mortgage rates have risen dramatically this year, homebuyers across the country should see this decline as welcome news.

Freddie Mac reports that the average 30-year rate was down to 5.30% from 5.81% two weeks prior (see graph below):

But why is this recent dip such good news for homebuyers? As Nadia Evangelou, Senior Economist and Director of Forecasting at the National Association of Realtors (NAR), explains:

“According to Freddie Mac, the 30-year fixed mortgage rate dropped sharply by 40 basis points to 5.3 percent. . . . As a result, home buying is about 5 percent more affordable than a week ago. This translates to about $100 less every month on a mortgage payment.”

That’s because when rates go up (as they have for the majority of this year), they impact how much you’ll pay in your monthly mortgage payment, which directly affects how much you can comfortably afford. The inverse is also true. A decrease in mortgage rates means an increase in your purchasing power.

The chart below shows how a half-point, or even a quarter-point, change in mortgage rates can impact your monthly payment:

Bottom Line

If your home doesn’t meet your needs, this may be the opportunity you’ve been waiting for. Contact a local real estate advisor today to see how you can benefit from the current drop in mortgage rates.

Article authored by and shared from: Keeping Current Matters

If you have lived in your home for some time or are in search of a new home, you might be out of the loop on the latest features a home can include. From the newest technology to bonus rooms, we will cover a few must-have features to help you maximize convenience and increase your home value.

Smart Technology

Today’s modern home should come with some smart technology with it. This tech can make home living more convenient while keeping you safe.

For example, a smart thermostat allows you to adjust or schedule temperature changes through your app. This feature can be convenient by keeping your AC at a higher temperature when you’re not home, then turning it on when you’re heading back to come home to a cool home. In addition, smart thermostats save energy, making the price worth it.

Another instance of smart technology is a home security system, letting you look through your home’s cameras at your convenience. Having this system can keep you safer compared to a base security setup.

Smart technology can also include your wall outlets, which can shut off when not in use. These outlets also come with USB slots, making charging small electronics more accessible.

You can also consider smart appliances, from your fridge to your oven. These appliances can make kitchen work more straightforward and can often keep you up with the news. For instance, smart fridges might have a display that tells you the weather, or a digital grocery list.

Your home probably won’t have every piece of smart tech in existence, so think of the basics and go from there. You can always buy more.

A Spacious Laundry Room

Many homeowners are looking for a laundry room where the appliances can connect. However, most laundry rooms are small and built into another room. One must-have home feature the modern homeowner should pursue is a larger room that makes storing dirty clothes and folding clean ones easier.

If your home doesn’t have a room like this, don’t count it out yet. Homes that have a spacious basement could double as a larger laundry room. As long as you have an area where doing laundry can be more accessible, you’re golden.

A Heated Garage

A garage is essential for a modern homeowner. It lets you store your vehicles and other belongings or act as a hobby room. However, many garages lack heating, which can be a problem. Even though a garage can be warmer than the outside, it can still damage cars and even invite cold air into your home, worsening your heating bill. Portable heaters are usually not powerful enough to warm the entire space, and can pose fire hazards.

A garage with heating built-in can be a valuable solution, keeping every part of your home warm during the winter.

Of course, this feature ultimately depends on the severity of your winters. For example, you might not need this if you live in an area known for its milder winters. However, if you expect plenty of snow, ensure your garage has some heating.

Sensor-Activated Exterior Lighting

Another must-have home feature your property needs is exterior lighting. This type of lighting can include walkway lights or spotlights in your yard. It also emphasizes your yard, making it the envy of everyone who passes by. Many of these lights can be solar-powered, so there is no additional expense on your electric bill.

Sensor-activated lights can come on automatically at night or when someone is walking toward them. Both can work well as security systems, making it easier to see a possible burglar. Well-lit homes are less likely to be targeted.

Walk-In Kitchen Pantry

Another feature that many homeowners should look for is a walk-in pantry. Although most people immediately think of a closet at the mention of walk-in, the pantry is another area that can benefit from additional space. The kitchen can become crowded, particularly if you’re a bulk buyer or have many appliances you use. We recommend storing larger appliances in the pantry to create counterspace. Additional, you can stash non-perishable food in case of an emergency. Overall, a pantry makes storage easier while avoiding clutter in and around your main cooking operations.

A Nice Patio

One feature many future homeowners look for is a suitable patio. The patio is the place where magic can happen. Think of family cookouts or having a deep conversation with your friends at midnight over a few drinks.

The size of the patio can depend on your needs and budget. If you don’t have a large patio, many come with conveniences to give you more room, including built-in fireplaces and grills. Envision how you want to spend your nights on the patio and come up with a design that can suit them.

A Bonus Room

When buying a home, having an extra room can be a lifesaver. If your home already has everything you need, you might feel like an extra room is unneeded. But, it’s nice to have some cushion for future changes. What happens if you get into a new hobby like sewing and need extra space for your machine and supplies? What if you want to build an in-home gym? What if you end up having a child?

A bonus room can be a convenient solution when life has a few extra surprises it wants to throw at you. Avoid stress over building a new room or planning an addition to your home by starting with an additional room (if budget allows).

Conclusion

These seven features are what many modern homeowners look for when buying a home. There are many more features that suit individual tastes, and you probably have some must-haves that we missed.

Remember, your home might not have everything on the list, so pick the must-haves you feel are most important to you. You can improve your home over time, meaning that you can eventually have the house that has it all!

Source: Realty Executives

Realty Executives Midwest
1310 Plainfield Rd. Ste 2 | Darien, IL 60561
Office: 630-969-8880
E-Mail: experts@realtyexecutives.com