Why is home affordability declining in our area? What does this mean for buyers and sellers?
Real estate is a commodity, and like everything else in our economy, it’s driven by supply and demand. And as everybody knows, between 2006 and 2008, we suffered a market crash. When that crash happened, the builders in our area decided to either shut down their operation or leave.
After this, there weren’t many homes being built in our area, and this has led to our current supply issue. Inventory is low because there weren’t enough homes being built to keep up with the people moving into our area. People have been driven to move here because of the number of big businesses we’ve been able to attract.
The good news is that our builders are back and they’re building again. It will be several years before our supply catches up with our demand, though.
If you’re a seller, this means you can get top dollar for your home right now. It’s the perfect time to sell because prices are still rising. If you’re a buyer, the situation is a little bit tougher. Not only is inventory low, but interest rates have recently risen, and they’re predicted to continue to rise over the next year or two. The more they rise, the more your purchasing power declines.
That being said, it’s still the right time to buy. The longer you wait, the greater the chances you’ll get priced out of the market completely. Though the process is a little bit more difficult, we’re still finding great homes for all of our buyers.
If you have any other questions about our market or you’re thinking of buying or selling a home, don’t hesitate to reach out to us. We’d be glad to help you.