Are we in the middle of a market change? Most Real Estate professionals will have varying opinions, but in my assessment we have shifted toward a seller’s market. Not to the extreme in which the media has proclaimed, but definitely getting away from buyers purchasing homes at a reduced price.
The first sign of this can be seen in the distressed sales market. Foreclosure inventory has decreased 18% over the last two years. Gone are the days of having your pick of foreclosed homes to buy at rock bottom prices. Most of the last decade has been spent in recovery mode. This may have caused a whole generation to have a negative feeling towards home ownership. Before the “Crash of 2008” people were moving an average of every 3-5 years, statistics now show a 10-year average. People were choosing to stay and fix up what they had, while waiting for the market to rise. Has the day come for that to change?
The recent rise in interest rates is causing more buyers to jump into the real estate market. Simply because, higher rates cause less buying power for the consumer. Which has resulted in a 13% rise in closed sales in the last two years. Currently there is not enough inventory available on the market. Real Estate professionals are concerned this may cause another bubble in the market. A 6-month inventory supply is a normal balanced market. Once housing inventory dips below a 6-month supply, the market will shift into a seller’s market. Certain neighborhoods throughout Hampton Roads have already seen this trend. Home building needs to be ramped up to meet the demand of the Millennial & Baby Boomer generation.
Hampton Roads is fairly lucky in the fact we are “protected” literally and figuratively by the military. We are one of the largest transient areas in America, which allows the southeast region to stay relatively stable. We never see the highs of the market like the big cities, but we also don’t experience the massive lows either. Hampton Roads is a great area to invest in financially. Rentals and the resale of homes are always needed to keep up with demand of our growing military and government contractors. So, don’t be afraid to invest in our Hampton Roads Real Estate market, we tend to survive!!
As always, if you or someone you know is ready to buy or sell…
Give the Thompson Team a call!!