When looking for a house to buy, you aren’t necessarily always looking for the biggest house. After all, the size of the home you choose will be determined, in part, by things like the size of your family, storage needs, how many bathrooms and bedrooms, etc. Mostly, though, it’ll be determined by your budget. Because, when it comes down to it, we all would like a little more space. For that reason, a recent study looked at the largest 45 cities in the country and calculated the median home size and cost per square foot, in an effort to figure out which cities have the biggest homes and which give buyers the most space for the best price. The results show that the South has the biggest homes, with three of the top five cities located in Texas. In fact, Houston was the city with the largest median home size at 1,952 square feet, with Atlanta, Washington DC, Dallas, and Austin rounding out the top five. Southern cities also tend to have a lower price per square foot. For example, while Houston has the biggest homes, the median price per square foot was $100. By comparison, cities like San Francisco, Boston, and Denver have smaller homes but higher prices, mostly due to the fact that the housing stock in those areas is older. More here.
More Americans Think Now’s The Time To Sell
Nearly 80% of Americans say now is a good time to sell a house, according to a recent survey from the National Association of Realtors. This may be good news for buyers. These days, there are more home buyers than there are homes for sale, which is the primary factor causing prices to rise. But rising prices have also caused homeowners to think about the benefits of selling their home. And, if the results of the NAR’s Housing Opportunities and Market Experience survey are any indication, a growing number of them are beginning to consider putting their home on the market. If so, it’ll help provide additional choices for home buyers while also slowing the rate at which prices move upward. Lawrence Yun, NAR’s chief economist, says he believes American homeowners were waiting to see if the gains got any better before making a decision. “With prices having risen so quickly, many consumers were deciding to wait to list their homes hoping to see additional price and equity gains,” Yun said. “However, with indications that buyers are beginning to pull out, price gains are going to decelerate and potential sellers are considering that now is a good time to list and bring more properties to the market.” More here.
Luxury Home Market Continues To Heat Up
When it comes to real estate, most people know that location is key. Market conditions can differ from one neighborhood to the next. But location isn’t the only thing affecting the conditions you’ll encounter when shopping for a house to buy. Your price range will also have something to do with it. For example, the National Association of Realtors’ consumer website recently released its 2018 Luxury Home Index and the results show luxury home buyers face a far different market than buyers who are looking for a more affordable home. That’s because, while overall home price increases are showing signs of slowing down, in the luxury market they’re gaining speed. In fact, according to the index, there are a rising number of areas with double-digit price growth from the same time last year. In Sarasota, the nation’s fastest-growing luxury market, prices are up 21 percent from last year. Another difference between the overall market and the top 5 percent of all residential sales is the fact that luxury homes stay on the market longer. Luxury homes in the 90 counties analyzed were on the market a median of 121 days. More here.
Young Americans Choose The City Over Suburbs
When choosing where you’d like to live, there are a number of factors that you have to weigh. For example, some people may value privacy over convenience while others may prefer proximity to family and friends over entertainment and recreation options. In short, it’s a personal choice. And a lot of times it comes down to whether you’d like to live in a city setting or the suburbs. This is a common debate and one that typically falls along demographic lines. In other words, where you are in life will determine where you want to live. More proof of this is found in a recent report detailing the preferences of millennials. According to the results, young Americans overwhelming choose metropolitan areas known for their hip neighborhoods and closeness to job opportunities. In fact, a look at the top 10 zip codes with the largest population of millennials shows that areas like Chicago’s West Loop, Boston’s North End, and Manhattan’s Financial District are overwhelmingly popular with a younger demographic. Other city neighborhoods that make the list include Capitol Hill in Denver, Mission Bay in San Francisco, and Dallas’ Arts District. More here.
Inventory And Home Sales Flat In August
Sales of previously owned homes were unchanged from the month before in August, according to new data from the National Association of Realtors. The number of available homes for sale was also flat, with unsold inventory at a 4.3-month supply at the current sales pace. But, though there was little change in the numbers, Lawrence Yun, NAR’s chief economist, says buyers may be getting ready to move. “Strong gains in the Northeast and a moderate uptick in the Midwest helped to balance out any losses in the South and West, halting months of downward momentum,” Yun said. “With inventory stabilizing and modestly rising, buyers appear ready to step back into the market.” In other words, though there hasn’t been a significant change in conditions, there is a sense that price increases and low inventory are beginning to move in the right direction. This can be seen in the regional results, which show that some areas are improving at a quicker pace than others. Another indicator that relief may be on the way is how long the typical property stayed on the market in August. That’s because, the number of days homes were available before selling moved up for the first time in months. But, despite the improvement, properties are still selling quickly. In fact, the typical home sold in just 29 days in August. More here.
Number Of Sellers Reducing Their Price Increases
Naturally, potential home buyers become more concerned about affordability conditions as prices and mortgage rates rise. And since the past few years have seen both things happen, there’s been increasing concern about whether or not now is a good time to buy a house. That’s not to say there hasn’t been demand for homes. In fact, there are plenty of interested buyers and not enough homes to accommodate them, which is why prices have been rising in the first place. But recently, there’s been more data suggesting that home prices are beginning to soften. In fact, one recent report shows that 26.6 percent of homes listed for sale in September dropped their price, which is a nearly 5 percent increase from the same time last year. That’s good news for buyers, as is the fact that price drops have been showing year-over-year improvement since the end of March. Added to the fact that mortgage rates, while higher than last year, are still well below what is historically normal, the news about home prices means affordability may, once again, be moving in a more balanced direction and one that benefits buyers. More here.
Financial Security Boosts Housing Sentiment
It’s said that there are two sides to every story. But there are also two sides to the calculations potential home buyers undergo when deciding whether or not it’s a good time for them to look for a new house. After all, buyers have to take into consideration the cost of homes in the areas they’re looking to live but also their own financial security. That’s why Fannie Mae’s most recent Home Purchase Sentiment Index is encouraging. Because, though Americans have concerns about housing affordability, they are feeling confident financially and secure in their jobs. In fact, the number of survey respondents who said they aren’t concerned about losing their job rose 15 percent over the month before and those reporting that their income is higher than it was 12 months earlier hit a new survey high. Doug Duncan, Fannie Mae’s chief economist, says Americans are feeling the effects of a stronger economy. “Consumers are attuned to the divergence between the slowing housing market and strong macro economy,” Duncan said. “Consumers were less optimistic this month about both home buying and home selling conditions, while perceptions of income growth and confidence about job security are at survey highs.” More here.
Few Buyers Research Their Prospective Neighborhood
Choosing a house to buy is an important decision. After all, you’re committing a lot of money and several years of your life to a particular property. And so, home buyers tend to know what they want, whether it be a large kitchen, an appealing outdoor space, or an ample amount of storage. But surprisingly, large majorities of home buyers spend too little time paying attention to the neighborhood surrounding the home they’re considering. And, make no mistake, the neighborhood you move to will play an important role in how much you enjoy your new home. Surrounding amenities, schools, and safety are just a few of the factors that can lead to a case of buyer’s remorse. And, according to a recent survey, there are lot of buyers who’ve experienced just that. In fact, 36 percent of respondents said they’d have chosen a different neighborhood had they known more about the one they moved to. One reason this is so common is the number of buyers who do very little neighborhood research before buying. For example, less than half of recent home buyers searched photos of different parts of the neighborhood, visited hot spots, researched police reports, or took a trip to the area after dark. If you want to be certain you’re making a smart choice, do your homework and consider the area outside your potential new house just as much as you do the inside. More here.
Today’s Home Buyers Likely To Find Financing First
Buying a home is not something most people do very often. Unless you’re a real-estate investor or have to move frequently for work, you’re likely going to stay in the home you buy for more than a couple of years. In fact, recent data shows homeowners tend to stay in their house somewhere between 10 and 13 years. So it shouldn’t be surprising that there are some common misconceptions about the buying process and the best way to go about finding and buying a house. But, according to a recent survey, one common misstep is becoming less and less common. That’s because, the survey found nearly two thirds of recent buyers looked for financing before looking at homes and, among first-time buyers the number jumped to 85 percent. This is the right way to do things for a couple of reasons. First, meeting with a mortgage professional before heading out on the trail will let you know exactly where your price range is and what you may be qualified to borrow. Secondly, in a competitive market, having your financing already lined up means you can act fast when you find a home you love. If you’re not prequalified, a more prepared buyer is likely to make an offer and have the home under contract before you’ve even completed your application. More here.
Where Buyers Are Stretching Their Budgets Most
When calculating how much house you can comfortably afford, there are a few commonly cited rules that can be used. Among them, the one that says your home’s price shouldn’t be more than three times your annual income is popular. Of course, there are many other factors that play a role, including the amount of debt you have, your retirement goals, other expenses, etc. However, as a simple rule, it can be a good way to quickly come up with a ballpark price range before you work out the fine details. Using a variation on this rule, a recent study took data from the Home Mortgage Disclosure Act and looked at the median amount home buyers borrowed and compared it to borrowers’ median income to calculate how and where buyers were pushing their financial limits to purchase a house. The results, in all but a few cases, weren’t that surprising. That’s because the cities where home buyers had to stretch the most were mostly out West, including Los Angeles, San Francisco, Denver, and Seattle. However, though rust-belt metros like Cleveland, Detroit, and Buffalo were the least leveraged, the middle of the pack included places like Atlanta, Orlando, Chicago, Dallas, and Houston, which might not be the first places thought of when listing affordable areas to buy a house. More here.