Points to Consider….
Home prices are beginning to trend upward SLOWLY!!– affordability may slow appreciation
Rates expected to remain in the high 6’s into summer
Inventory is increasing, providing buyers a slight increase in negotiating power in growing areas
As those of us living in the Southeast are dusting off our latest pollen bonanza, this typically marks the beginning of the Spring market. Homebuyers are ready to shop as the listing numbers start their seasonal increase. But this year has some challenges.
In the Raleigh area markets, home appreciation seems to be slower than in most years. Historically appreciation runs around 6% in my local area. During the pandemic the market was extremely aggressive with multiple offers on many more properties than usual. This drove prices up and appraisals began to adjust. Now we have more of a buyers market, but coupled with additional obstacles like affordability.
Mortgage rates are expected to remain in the 6-7% range into summer, which will slow first time buyers ability to afford what they want. Sellers are coming from a hot, “pick your offer” kind of market. This then creates a potential pricing gap. Home values have not appreciated as much in the last 12-18 months, but many sellers dismiss this and end up on the market longer due to overpricing. As the seasonal inventory increases, leverage shifts towards the buyers.
Another good bit of news for buyers in this area is the supply of new housing is increasing. Builders have been busy preparing for the growth as more and more find the lifestyle and economy here appealing. Because of the growth, many buyers are looking at some of the smaller communities surrounding the metro areas. Prices can be much more affordable and lot sizes tend to be bigger. You may consider trading sewer for septic, public water for wells, and a longer trip to shop. But that’s just my opinion…