Century 21 Ocean Real Estate Blog

June 28, 2022

Brevard County Real Estate Market | Brevard County, FL | Market Update...Housing Statistics from May 2022

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  • Whether you’re buying or selling – today’s housing market has plenty of good news to go around.
  • Buyers can take advantage of today’s mortgage rates to escape rising rents and keep monthly payments affordable. Sellers can reap the benefits of multiple offers and a fast sale.
  • If this sounds like good news to you, let’s connect today so you can capitalize on the unique opportunity you have in today’s market.

321.323.1212 or email sales@c21ocean.com

Contact Us - We look forward to helping you!
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MLS Statistics - May 2022 - Single Family Homes

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MLS Statistics - May 2022 - Townhouses and Condos

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Our wide range of Brevard homes for sale go from beachfront, to riverfront, to condos, and more. Search our featured properties below for detailed listings in each Brevard County Community.

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Profile Image Barbara Schluraff
CENTURY 21 Ocean
Barbara Schluraff | Broker
sales@c21ocean.com
(321) 209-1481 - Mobile | (321) 323-1212 - Work
www.century21ocean.com

Please feel free to call us at 321.323.1212 or email us at sales@c21ocean.com if you have any questions or are looking for a specific market report.

We have years of experience, and are here to assist you.

We look forward to hearing from you!

 

 

© 2022 Century 21 Real Estate LLC. CENTURY 21® and the CENTURY 21 Logo are registered service marks owned by Century 21 Real Estate LLC. Equal Housing Opportunity. Each office is independently owned and operated.

June 23, 2022

Homeownership Is a Great Hedge Against the Impact of Rising Inflation

If you’re following along with the news today, you’ve heard about rising inflation. Today, inflation is at a 40-year high. According to the National Association of Home Builders (NAHB):

“Consumer prices accelerated again in May as shelter, energy and food prices continued to surge at the fastest pace in decades. This marked the third straight month for inflation above an 8% rate and was the largest year-over-year gain since December 1981.”

With inflation rising, you’re likely feeling it impacts your day-to-day life as prices go up for gas, groceries, and more. These climbing consumer costs can put a pinch on your wallet and make you re-evaluate any big purchases you have planned to ensure they’re still worthwhile.

If you’ve been thinking about purchasing a home this year, you’re probably wondering if you should continue down that path or if it makes more sense to wait. While the answer depends on your situation, here’s how homeownership can help you combat the rising costs that come with inflation.

Homeownership Helps You Stabilize One of Your Biggest Monthly Expenses

Investopedia explains that during a period of high inflation, prices rise across the board. That’s true for things like food, entertainment, and other goods and services, even housing. Both rental prices and home prices are on the rise. So, as a buyer, how can you protect yourself from increasing costs? The answer lies in homeownership.

Buying a home allows you to stabilize what’s typically your biggest monthly expense: your housing cost. When you have a fixed-rate mortgage on your home, you lock in your monthly payment for the duration of your loan, often 15 to 30 years. James Royal, Senior Wealth Management Reporter at Bankrate, says:

A fixed-rate mortgage allows you to maintain the biggest portion of housing expenses at the same payment. Sure, property taxes will rise and other expenses may creep up, but your monthly housing payment remains the same. That’s certainly not the case if you’re renting.”

So even if other prices increase, your housing payment will be a reliable amount that can help keep your budget in check. If you rent, you don’t have that same benefit, and you won’t be protected from rising housing costs.

Investing in an Asset That Historically Outperforms Inflation

While it’s true rising home prices and higher mortgage rates mean that buying a house today costs more than it did even a few months ago, you still have an opportunity to set yourself up for a long-term win. That’s because, in inflationary times, you want to be invested in an asset that outperforms inflation and typically holds or grows in value.

The graph below shows how the average home price appreciation outperformed the average inflation rate in most decades going all the way back to the seventies – making homeownership a historically strong hedge against inflation (see graph below):

Homeownership Is a Great Hedge Against the Impact of Rising Inflation | MyKCM

So, what does that mean for you? Today, experts forecast home prices will only go up from here thanks to the ongoing imbalance of supply and demand. Once you buy a house, any home price appreciation that does occur will grow your equity and your net worth. And since homes are typically assets that grow in value, you have peace of mind that history shows your investment is a strong one.

That means, if you’re ready and able, it makes sense to buy today before prices rise further.

Bottom Line

If you’ve been thinking about buying a home this year, it makes sense to act soon, even with inflation rising. That way you can stabilize your monthly housing cost and invest in an asset that historically outperforms inflation. If you’re ready to get started, let’s connect so you have expert advice on your specific situation when you’re ready to buy a home.

June 23, 2022

Top 5 Reasons You Should NOT FSBO

Rising home prices coupled with a lack of inventory in today’s market may cause some homeowners to consider selling their home on their own (known in the industry as a For Sale By Owner). However, a FSBO might not be a good idea for the vast majority of sellers.

The top 5 reasons are listed below:

1. Online Strategy for Prospective Purchasers

Recent studies have shown that 95% of buyers search online for a home. In comparison, only 13% use print newspaper ads. Most real estate agents have an Internet strategy to promote the sale of your home. Do you?

2. Results Come from the Internet

Where did buyers find the home they actually purchased?

  • 50% on the Internet
  • 7% from a yard sign
  • 28% from a Real Estate Agent
  • 1% from newspapers

The days of selling your house by putting up a sign and listing it in the paper are long gone. Having a strong Internet strategy is crucial.

3. There Are Too Many People to Negotiate With

Here is a list of some of the people with whom you must be prepared to negotiate if you decide to For Sale By Owner:

  • The buyer who wants the best deal possible
  • The buyer’s agent, who solely represents the best interest of the buyer
  • The buyer’s attorney (in some parts of the country)
  • The home inspection companies, which work for the buyer and will almost always find some problems with the house
  • The appraiser, if there is a question of value

4. FSBOing Has Become Increasingly Difficult

The paperwork involved in the process has increased dramatically as industry disclosures and regulations have become mandatory. This is one of the reasons that the percentage of people FSBOing has dropped from 19% to 7% over the last 20+ years.

5. You Net More Money When Using an Agent

Many homeowners believe that they will save the real estate commission by selling on their own. Realize that the main reason buyers look at FSBOs is because they also believe they can save the real estate agent’s commission. The seller and buyer can’t both save the commission.

A study by Collateral Analytics revealed that FSBOs don’t actually save anything by forgoing the help of an agent. In some cases, they may actually cost themselves more. One of the main reasons for the price difference at the time of sale is:

“Properties listed with a broker that is a member of the local MLS will be listed online with all other participating broker websites, marketing the home to a much larger buyer population. And those MLS properties generally offer compensation to agents who represent buyers, incentivizing them to show and sell the property and again potentially enlarging the buyer pool.”

The more buyers that view a home, the greater the chance of a bidding war for the property. 

Bottom Line

Before you decide to take on the challenge of selling your house on your own, let’s get together to discuss your needs.

Call or Text the LISTING TEAM at CENTURY 21 Ocean today! (321) 209-1481 ~ Listingteam@c21ocean.com

June 21, 2022

Lending - Week In Review June 13 2022

Week of June 13, 2022, in Review

A Fed rate hike, hot wholesale inflation, weakening builder confidence, and signs of economic slowdown led to a volatile week in the markets. Here are the top headlines:

Fed Rate Hike Largest Since 1994

Wholesale Inflation Declines Slightly But Remains Elevated

Builder Confidence Weakens as Homebuyer Traffic Slows

Despite Slowing Housing Starts, Glimmer of Hope for Home Completions 

What to Look for in Jobless Claims Data

More Signs of Economic Slowdown

Fed Rate Hike Largest Since 1994

The Fed was expected to hike its benchmark Fed Funds Rate by 50 basis points at its meeting last week but instead acted more aggressively with a 75 basis point hike, due in large part to the hotter than expected Consumer Price Index reading that was reported on June 10. Note that the Fed Funds Rate is the interest rate for overnight borrowing for banks and it is not the same as mortgage rates. 

The main tool the Fed uses to curb inflation is hiking its benchmark Fed Funds Rate, so counterintuitively Fed rate hikes can be good for mortgage rates if they’re perceived to curb inflation. The Fed also noted that depending on the data, they will hike another 50 or 75 basis points at their meeting on July 26-27. 

What’s the bottom line? Central bankers around the world are scrambling to put the inflation genie back in the bottle, as we have seen hikes by the Bank of England, Taiwan, United Arab Emirates, Qatar, Bahrain, and Brazil, and a surprise 50 basis point hike by the Swiss Bank, which led to market volatility last Thursday. It will be important to see if investors and the markets believe the Fed and other central banks can get a handle on inflation, as this will play a crucial role in the direction of Mortgage Bonds and mortgage rates this year.

Wholesale Inflation Declines Slightly But Remains Elevated

The Producer Price Index (PPI), which measures inflation on the wholesale level, was in line with estimates with a 0.8% rise in May. On a year-over-year basis, PPI declined slightly from 10.9% to 10.8%. Core PPI, which strips out food and energy prices, came in just below estimates with a 0.5% increase. The year-over-year figure declined from 8.6% to 8.3%. 

What’s the bottom line? While the markets reacted favorably to the slight decline in wholesale inflation, producer inflation remains elevated. This can lead to hotter consumer inflation levels, as producers pass those higher costs along to consumers. 

In addition, 28% of small business owners reported that inflation was their single most important problem in operating their business in May, per the National Federation of Independent Business Small Business Optimism Index. Owners expecting better business conditions over the next six months also fell four points to a net negative 54%, which is the lowest level recorded in the survey’s 48-year history.

Builder Confidence Weakens as Homebuyer Traffic Slows

The National Association of Home Builders Housing Market Index, which is a near real-time read on builder confidence, fell 2 points to 67 in June, as expected. Looking at the components of the index, current sales conditions fell 1 point to 77, future sales expectations were down 2 points to 61 and buyer traffic declined 5 points to 48. 

What’s the bottom line? Any reading above 50 on this index, which runs from 0 to 100, signals expansion while readings below 50 signal contraction. Overall, while these figures have declined significantly from last year, most are still at pretty strong levels. A big concern is that traffic has dipped beneath 50, which signals contraction. 

NAHB’s chief economist, Robert Dietz, noted that, “Residential construction material costs are up 19% year-over-year with cost increases for a variety of building inputs, except for lumber.” He also said that they are seeing less demand due to the increase in mortgage rates, which is reflected in the decline of buyer traffic as noted above.

 

 

 

Despite Slowing Housing Starts, Glimmer of Hope for Home Completions

Housing Starts, which measure the start of construction on homes, plunged 14.4% from April to May. Starts for single-family homes, which are the most important because they are in such high demand among buyers, were also down 9.2%. Building Permits, which are a good forward-looking indicator for Housing Starts, were down 7% while single-family permits also fell by a large amount, dropping 5.5%. 

What’s the bottom line? On a positive note, we finally saw some more homes completed in May, which will add to more inventory in the short term. Housing completions were up 9.1% from April to May, with single-family units completed up 2.8% last month. 

What to Look for in Jobless Claims Data

The number of people filing for unemployment benefits for the first time fell by 3,000 in the latest week, as 229,000 Initial Jobless Claims were reported. Continuing Claims, which measure people who continue to receive benefits after their initial claim is filed, increased by 3,000 to 1.312 million, remaining near a 50-year low. 

 

What’s the bottom line? While Initial Jobless Claims decreased in the latest week, the 4-week average is at the highest level since late January. This could be an early sign that companies are starting to not only pause hiring but are also beginning to lay people off due to slowdowns. We have heard announcements of significant layoffs from several public companies, which will start to show up in these numbers, so this is something important to monitor in the weeks ahead. 

 

 

 

More Signs of Economic Slowdown

Recent reports offer more signals that the economy is slowing. In the manufacturing sector, there were negative readings (which signal contraction) reported for the New York and Philadelphia regions via June’s Empire State and Philadelphia Fed Indexes. Retail Sales also fell 0.3% in May, while April’s data was also revised lower. This comes as higher food and gas prices are hurting consumers’ budgets for discretionary spending. 

In addition, the nation’s personal savings rate, which soared during the early months of the pandemic, has now fallen back to below its pre-pandemic levels. The savings rate was 7.8% in January 2020, rose to 33.8% in April 2020, and now has dropped back to 4.4% in April 2022. The 4.4% rate is the lowest recorded in the United States since September 2008 and is another recessionary indicator.

Family Hack of the Week 

If camping is part of your summer plans, these French Toast Foil Packets courtesy of the Food Network are a perfect way to start the day.

Prepare a grill for medium-high heat. Melt 3 tablespoons of unsalted butter. Tear eight 14-inch pieces of non-stick foil and lay them non-stick side up. Brush the centers with melted butter.

Whisk together one 12-ounce can of nonfat evaporated milk, 2 large eggs, 2 tablespoons maple syrup, and 2 teaspoons pure vanilla extract in a small baking dish or resealable bag. Dip 8 slices of multi-grain bread in the milk mixture until fully submerged. Arrange 2 pieces of bread next to each other (do not overlap them) on a piece of buttered foil. Repeat with the remaining bread and 3 pieces of the foil.

To make the foil packs, place the remaining 4 pieces of foil buttered-side down so the butter touches the bread and the edges line up. Fold and crimp the edges tightly. Place the packs on the grill, close the lid and cook for 5 minutes. Turn packets over, close the lid, and grill for 5 additional minutes.

Remove packs from the grill and let cool for a few minutes. Carefully open the packets and top each serving with mixed berries, and maple syrup, and enjoy.

What to Look for This Week 

After the market closures Monday in honor of the Juneteenth holiday, key housing reports highlight the economic calendar. Tuesday brings an update on Existing Home Sales for May, while New Home Sales follow on Friday. The latest Jobless Claims data also remains crucial to monitor when it is released as usual on Thursday.

Technical Picture

Mortgage Bonds ended last week trading in the very wide range between support at 98 and overhead resistance at 99.625. Expect continued volatility while in this 162 basis point range. The 10-year is testing an important inflection point at 3.25%. If yields can get underneath this level, there is room to improve until reaching 3%. On the other hand, if yields break to the upside, they may retest the 3.5% zone.

 

 

 

 

Sean Wigand | Loan Officer

NMLS # 1715261

Ark-La-Tex Financial Services, LLC NMLS# 2143

Office: 561.532.2745 | Mobile: 561.698.2040

Two South University Drive Suite 231 | Plantation, FL 33324

sean.wigand@benchmark.us

 

www.wigandteam.com

June 16, 2022

Week of June 6, 2022 in Review

 

Provided to you by:

Sean Wigand

Benchmark Mortgage

Ark-La-Tex Financial Services, LLC NMLS# 2143

Cell # 561-698-2040

sean.wigand@benchmark.us

NMLS # 1715261

 

Newsletter 6-13-22

 

Week of June 6, 2022, in Review

Consumer inflation reached a 41-year high in May while annual home price appreciation tied another record high in April. Here are the key headlines:

Consumer Inflation Hits Highest Level Since 1981

Majority of Top Economists Do Not Believe We’re in a Housing Bubble

Annual Home Price Appreciation Ties Record High 

Does the Rise in Initial Jobless Claims Signal a Slowdown?

 

Consumer Inflation Hits Highest Level Since 1981

The Consumer Price Index (CPI), which measures inflation on the consumer level, rose 1% in May, which was much higher than the expected 0.7% gain. On an annual basis, CPI rose from 8.3% to 8.6%, which is the hottest reading in 41 years. Core CPI, which strips out volatile food and energy prices, rose by 0.6%, just above the 0.5% gain expected. Year over year, Core CPI decreased from 6.2% to 6%.

Of particular note within the report, food costs climbed another 1.2% in May, bringing the year-over-year gain to 10.1%. Rents rose 0.6% last month and are now up 5.2% year over year. Fuel also increased 16.9% in May and is now up almost 107% from this time last year. On average across the country, gas prices are over $5 a gallon, which is the highest ever. 

What’s the bottom line? Not only does inflation lead to higher costs of goods, but it is also the arch-enemy of fixed investments like Mortgage Bonds because it erodes the buying power of a Bond’s fixed rate of return. If inflation is rising, investors demand a rate of return to combat the faster pace of erosion due to inflation, causing interest rates to rise as we’ve seen this year. 

Remember that the main tool the Fed uses to curb inflation is hiking its benchmark Fed Funds Rate, which is the interest rate for overnight borrowing for banks and it is not the same as mortgage rates. So counterintuitively, when the Fed hikes its benchmark Fed Funds Rate, this can be good for interest rates because it curbs inflation. The Fed is expected to hike its benchmark Fed Funds Rate by 50 basis points at its meeting this week, and investors will be closely watching what actions they take and comments they make regarding inflation.

Majority of Top Economists Do Not Believe We’re in a Housing Bubble

Zillow and Pulsenomics released their Home Price Expectations Survey for the second quarter. This survey, which is released each quarter, asks a distinguished panel of over 100 economists, investment strategists and housing market analysts about their 5-year expectations for future home prices in the United States. 

Of the 114 economists surveyed this time, participants said they expect home prices to appreciate 4.8% on average per year over the next 5 years. Cumulatively, they expect over 26% appreciation through 2026. 

What’s the bottom line? Respondents were also asked, “Do you believe the U.S. housing market is currently in a bubble?” Of the 98 respondents with an opinion on the question, 65% answered “No.” Some of the reasons provided for this belief included continued low housing inventory, recent price growth caused by fundamentals like demographics and shifting housing preferences, rising rents, the work-from-home revolution, and high homeowner equity. So while it may not be easy to buy a home right now, it should still be a smart financial decision.

Annual Home Price Appreciation Ties Record High

CoreLogic released their Home Price Index report for April, showing that home prices rose by 2.6% from March and 20.9% on a year-over-year basis. This annual reading remained stable from March and matches the highest reading in the 45-year history of the index. In addition, CoreLogic estimated that 70% of homes sold above the asking price this spring.

What’s the bottom line? CoreLogic forecasts that home prices will appreciate 1.2% in May and 5.6% in the year going forward, though this annual figure is still much more conservative than many other forecasts. But even if CoreLogic’s annual forecast is correct and home prices rise closer to 5% over the next year, this level of appreciation is still extremely meaningful for wealth creation. For example, if someone bought a $400,000 home and put 10% down, that means they would gain $20,000 in appreciation over the next year and earn a 50% return on their investment due to leverage.

Does the Rise in Initial Jobless Claims Signal a Slowdown?

Initial Jobless Claims rose by 27,000 in the latest week, as 229,000 people filed for unemployment benefits for the first time. Continuing Claims, which measure people who continue to receive benefits after their initial claim is filed, remained unchanged at 1.306 million. This is the lowest number of Continuing Claims in more than 50 years.

What’s the bottom line? While Initial Jobless Claims decreased in the latest week, the 4-week average is at the highest level since mid-February. This could be an early sign that companies are starting to not only pause hiring but are also beginning to lay people off due to slowdowns. It’s crucial to monitor this report and see if Initial Jobless Claims continue to rise. 

Family Hack of the Week 

June 13 is National Cupcake Lover’s Day. This recipe for Peanut Butter Chocolate Cupcakes from our friends at Taste of Home is perfect for celebrating all week long.

Preheat the oven to 350 degrees Fahrenheit. In a small bowl, beat 3 ounces softened cream cheese, 1/4 cup creamy peanut butter, 2 tablespoons sugar, and 1 tablespoon milk until smooth. Set aside.

In a large bowl, mix 2 cups sugar, 1 3/4 cups all-purpose flour, 1/2 cup baking cocoa, 1 1/2 teaspoons baking powder, 1/4 teaspoon baking soda, and 1 teaspoon salt. In a separate bowl, whisk together 2 large eggs, 1 cup water, 1 cup milk, 1/2 cup canola oil, and 2 teaspoons vanilla extract. Add the dry ingredients to the wet ingredients until just moistened. Note that the batter will be thin.

Line 12 jumbo muffin cups with paper and fill them halfway with batter. Add a tablespoon of peanut butter mixture to the centers of each and cover with the remaining batter. Bake at 350 degrees Fahrenheit for 25-30 minutes or until a toothpick inserted comes out clean. Cool for 10 minutes and then remove from pans and place on wire racks to cool completely.

To make the frosting, combine 1/3 cup softened butter, 2 cups confectioners’ sugar, 6 tablespoons baking cocoa, and 3 1/2 tablespoons milk. Frost cupcakes once cooled and enjoy.

 

What to Look for This Week 

More inflation and housing data are ahead, beginning Tuesday when the Producer Price Index for May will give us an update on wholesale inflation. On Wednesday, June’s National Association of Home Builders Housing Market Index provides a near real-time read on builder confidence while Thursday brings Housing Starts and Building Permits for May.

Also of note, we’ll get a read on how small businesses are feeling when the National Federation of Independent Business Small Business Optimism Index is reported on Tuesday. The latest Jobless Claims data will be released as usual on Thursday. Plus, important manufacturing data for both the New York and Philadelphia regions will show if there is more evidence of a slowdown. 

But perhaps the biggest news will be the Fed’s two-day meeting beginning Tuesday, with the Monetary Policy Statement and press conference coming on Wednesday. Again, investors will be closely watching their actions and commentary regarding inflation.

Technical Picture

Mortgage Bonds ended the week much lower, breaking beneath support at 100.531 after a hotter than expected CPI report on Friday. There is a lot more room to the downside now that this important floor has been broken. Looking at the 10-year, yields are currently at around 3.15%, with no real ceiling or resistance levels to stop them before reaching the next ceiling at 3.25%. If that level does not hold, we could see yields move as high as 3.50%.

Sean Wigand | Loan Officer

NMLS # 1715261

Ark-La-Tex Financial Services, LLC NMLS# 2143

Office: 561.532.2745 | Mobile: 561.698.2040

Two South University Drive Suite 231 | Plantation, FL 33324

 

sean.wigand@benchmark.us

www.wigandteam.com

 

 


 

June 15, 2022

Why the Growing Number of Homes for Sale Is Good for Your Move Up

Are you thinking about selling your current home? If so, the biggest question on your mind may be: if I sell now, where will I go? If this resonates with you, there’s something you should know. The number of homes coming onto the market is increasing and that could make it easier for you to move up this summer.

According to the latest data from realtor.com, the number of homes being listed for sale, known as new listings, has increased consistently this year (see graph below):

Why the Growing Number of Homes for Sale Is Good for Your Move Up | MyKCM

While this news has clear benefits for buyers who are craving more options for their home search, what does that mean for current homeowners like you? It gives you two distinct opportunities in today’s housing market.

Opportunity #1: Take Advantage of More Options for Your Move Up

If your current house no longer meets your needs or lacks the space and features you want, this gives you even more opportunity to sell and move up into the home of your dreams. As more options come to market, you’ll have more to choose from when you search for your next home.

Partnering with a local real estate professional can help make sure you see these listings as soon as they come onto the market. And when you do find the one, that professional can advise you on how to write a winning offer to seal the deal.

Opportunity #2: Sell Before You Have More Competition

Just know that, in order to make sure your house shines above the rest, it may make sense to put your home up for sale before your neighbors do the same, creating more competition in your area. The increase in the number of homes being listed for sale is expected to continue, and a recent study from realtor.com says two-thirds of homeowners looking to sell say they’ll do so by August.

A real estate professional can advise you on what you need to tackle to get your house ready to list so they can put that for sale sign up in your yard sooner rather than later. That’s because the process of getting a home ready to sell isn’t taking as long as you may think. As a result, you can capitalize on today’s sellers’ market and get ahead of the competition.

Bottom Line

If you’re a current homeowner looking to sell, let’s connect to begin the process. You have a unique opportunity to benefit from the additional homes being listed today and sell before your house has more competition.

June 15, 2022

Is the Housing Market Correcting?

 Is the Housing Market Correcting? | MyKCM

If you’re following the news, all of the headlines about conditions in the current housing market may leave you with more questions than answers. Is the boom over? Is the market crashing or correcting? Here’s what you need to know.

The housing market is moderating compared to the last two years, but what everyone needs to remember is that the past two years were record-breaking in nearly every way. Record-low mortgage rates and millennials reaching peak homebuying years led to an influx of buyer demand. At the same time, there weren’t enough homes available to purchase thanks to many years of underbuilding and sellers who held off on listing their homes due to the health crisis.

This combination led to record-high demand and record-low supply, and that wasn’t going to be sustainable for the long term. The latest data shows early signs of a shift back to the market pace seen in the years leading up to the pandemic – not a crash nor a correction. As realtor.com says:

The housing market is at a turning point. . . . We’re starting to see signs of a new direction, . . .”

Home Showings Then and Now

The ShowingTime Showing Index tracks the traffic of home showings according to agents and brokers. It’s a good indication of buyer demand. Here’s a look at that data going back to 2019 (see graph below):

Is the Housing Market Correcting? | MyKCM

The 2019 numbers give a good baseline of pre-pandemic demand (shown in gray). As the graph indicates, home showings skyrocketed during the pandemic (shown in blue). And while current buyer demand has begun to moderate slightly based on the latest data (shown in green), showings are still above 2019 levels.

And since 2019 was such a strong year for the housing market, this helps show that the market isn’t crashing – it’s just at a turning point that’s moving back toward more pre-pandemic levels.

Existing Home Sales Then and Now

Headlines are also talking about how existing home sales are declining, but perspective matters. Here’s a look at existing home sales going all the way back to 2019 using data from the National Association of Realtors (NAR) (see graph below):

Is the Housing Market Correcting? | MyKCM

Again, a similar story emerges. The pandemic numbers (shown in blue) beat the more typical year of 2019 home sales (shown in gray). And according to the latest projections for 2022 (shown in green), the market is on pace to close this year with more home sales than in 2019 as well.

It’s important to compare today not to the abnormal pandemic years, but to the most recent normal year to show the current housing market is still strong. First American sums it up like this:

“. . . today’s housing market looks a lot like the 2019 housing market, which was the strongest housing market in a decade at the time.”

Bottom Line

If recent headlines are generating any concerns, look at a more typical year for perspective. The current market is not a crash or correction. It’s just a turning point toward more typical, pre-pandemic levels. Let’s connect if you have any questions about our local market and what it means for you when you buy or sell this year.

June 15, 2022

More Americans Choose Real Estate as the Best Investment Than Ever Before

 

Americans’ opinion on the value of real estate as an investment is climbing. That’s according to an annual survey from Gallup. Not only is real estate viewed as the best investment for the ninth year in a row, but more Americans selected it than ever before.

The graph below shows the results of the survey since Gallup began asking the question in 2011. As the trend lines indicate, real estate has been gaining ground as the clear favorite for almost a decade now:

More Americans Choose Real Estate as the Best Investment Than Ever Before | MyKCM

If you’re thinking about purchasing a home, let this poll reassure you. Even when inflation is high as today, Americans recognize owning a home is a powerful financial decision.

How an Investment in Real Estate Can Benefit You During High Inflation

Because inflation reached its highest level in 40 years recently, it’s more important than ever to understand the financial benefits of homeownership. Rising inflation means prices are increasing across the board, and that includes goods, services, housing costs, and more. When you purchase your home, you lock in your monthly housing payments, effectively shielding yourself from increases on one of your biggest budgetary items each month.

If you’re a renter, you don’t have that same benefit, and you aren’t protected from these increases, especially as rents rise. As Danielle Hale, Chief Economist at realtor.com, notes:

“Rising rents, which continue to climb at double-digit pace . . . and the prospect of locking in a monthly housing cost in a market with widespread inflation are motivating today’s first-time homebuyers.”

When Inflation Has Risen in the Past, Home Prices Have Too

Your house is also an asset that typically increases in value over time, even during inflation. That‘s because as prices rise, the value of your home does too. Mark Cussen, Financial Writer for Investopedia, puts it like this:

“There are many advantages to investing in real estate. . . . It often acts as a good inflation hedge since there will always be a demand for homes, regardless of the economic climate, and because as inflation rises, so do property values. . . .”

And since rising home values help increase your equity, and by extension your net worth, homeownership is historically a good hedge against inflation.

Bottom Line

Buying a home is a powerful decision. It’s no wonder why so many people view it as the best long-term investment, even when inflation is high. When you buy, you help shield yourself from increases in your housing costs and you own an asset that typically gains value with time. If you want to better understand how buying a home could be a great investment for you, let’s connect today.

Barbara Schluraff

Broker/Owner

117 N Orlando Ave, Cocoa Beach, FL 32931

B 321.323.1212 | C 321.720.3878

century21ocean.com

 

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June 15, 2022

Luxury Homes Are in High Demand

As people realize their needs are changing, some are turning to luxury housing to find their dream home. Investopedia helps define what pushes a home into this category. In a recent article, they point out that a luxury home isn’t only defined by its price. Location is also an important factor. It could be a condo at a desirable city address, a spacious home on the water, or one with access to luxury activities like arts and entertainment, high-end shopping and dining, and more. The home itself will also boast some of the finest features available.

According to the Luxury Market Report from the Institute for Luxury Home Marketing, there’s been a substantial increase in how many buyers are purchasing luxury homes over the past two years. It says:

“. . . North America recorded the fastest growth of demand during the first year of the pandemic. Also, demand has . . . consistently increased, and even in April 2022, we saw a higher volume of sales compared to 2021.

If you own a luxury home, it could be a great time to list your house today while demand is so high. But first, let’s understand where the demand is coming from.

What’s Driving the Heightened Buyer Demand for High-End Homes?

The same report says more people have reached a certain net-worth threshold, and that’s contributing to the increased interest in luxury housing:

“In 2020, we saw a 2.2% growth in the number of individuals with wealth of over $5 million in net value, but in 2021 that number grew by an outstanding 19.8%.

This total increase has resulted in the introduction of over 660,000 new individuals into the high net-worth bracket, which, combined with the existing affluent looking to both diversify and add new properties to their portfolio, provides a true insight into why the demand for luxury properties skyrocketed during 2021 and into 2022.”

So, if you’re looking to make changes to your real estate portfolio or are looking to sell your current house, it may be a great time to list and benefit from the high demand for luxury homes today.

Bottom Line

If you own a luxury home and want to know how strong demand is in your area, let’s connect so you can capitalize on current market conditions while buyer demand for upscale homes is so high.

 

BROWSE THE LATEST LUXURY HOMES FOR SALE IN BREVARD COUNTY, FLORIDA

 

Barbara Schluraff

Broker/Owner

117 N Orlando Ave, Cocoa Beach, FL 32931

B 321.323.1212 | C 321.720.3878

century21ocean.com

Find Out What Your Home Is Worth! Click HERE!

Posted in Luxury Homes
May 27, 2022

Things That Could Help You Win a Bidding War on a Home

With a limited number of homes for sale today and so many buyers looking to purchase before mortgage rates rise further, bidding wars are common. According to the latest report from the National Association of Realtors (NAR), homes are getting an average of 4.8 offers per sale nationwide. Here’s a look at how that breaks down state-by-state (see map below):

Things That Could Help You Win a Bidding War on a Home | MyKCM

The same report from NAR shows the average buyer made two offers before getting their third offer accepted. In this competitive housing market, it’s important to know what levers you can pull to help you beat the competition. While a real estate professional is your ultimate guide to presenting a strong offer, here are a few things you could consider.

Offering over Asking Price

When you think of sweetening the deal for sellers, the first thought you likely have is around the price of the home. In today’s housing market, more homes are selling for over the asking price because there are more buyers than there are homes for sale. You just want to make sure your offer is still within your budget and realistic for the market value in your area – that’s where a local real estate professional can help you through the process. Bankrate says:

Simply put, being willing to pay more money than other buyers is one of the best ways to get your offer accepted. You may not have to increase it by a lot — it’ll depend on the area and other factors — so look to your real estate agent for guidance.”

Putting Down a Bigger Earnest Money Deposit

You could also consider putting down a larger deposit upfront. An earnest money deposit is a check you write to go along with your offer. This deposit is credited toward your home purchase if your offer is accepted. NerdWallet explains how it works:

A typical earnest money deposit is 1% to 2% of the home’s purchase price, but the amount varies by location. A higher earnest money deposit may catch a seller’s attention in a hot housing market.”

It shows the seller you’re seriously interested in their house and have already set aside money that you’re ready to put toward the purchase.

Making a Higher Down Payment 

Another option is increasing how much of a down payment you will make. A higher down payment benefits you won’t have to finance as much. This helps the seller feel like there’s less risk of the deal or the financing falling through. And if other buyers put less down, it could be what helps your offer stand out from the crowd.

Non-Financial Options To Make a Strong Offer

Realtor.com points out that while increasing these financial portions of the deal can help, they’re not your only options:

. . . Price is not the only factor sellers weigh when they look at offers. The buyer’s terms and contingencies are also taken into account, as well as pre-approval letters, appraisal requirements, and the closing time the buyer is asking for.”

When it’s time to make an offer, partner with a trusted professional. They have insight into what sellers are looking for in your local market and can give you expert advice on what levers you may or may not want to pull when it’s time to write an offer.

From a non-financial perspective, this can include flexible move-in dates or minimal contingencies (conditions you set that the seller must meet for the purchase to be finalized). For example, you could make an offer that’s not contingent on the sale of your current home. 

Bottom Line

In today’s hot housing market, you need a partner who can serve as your guide, especially when making a strong offer. Let’s connect, so you have a trusted resource and coach on how to make the strongest offer possible for your specific situation.