The housing market is on a tear lately, and is showing no signs of slowing, Already, it is risen 3.3 percent after being seasonally adjusted. Not since 2007 has the market gotten off to such a great start. In many areas, multiple offers are occurring.
There are many possible causes for this uptick, which include: steady job gains, modest pay raises, raising consumer confidence, and buyers getting ahead of mortgage rate hikes. Of all of these, I feel that the increasing rates are playing the largest role. Rates begin to move up when the Federal Reserve seeks to slow down a heating up economy. The hope is to limit growth to a sustainable level. On the national level, this may sound like a good idea. For the average buyer, it signals that more interest rate increases are on the horizon. As the rates go up, the amount that you can afford goes down. This is truly the best time to buy. We suggest beating the rate hike by purchasing now. We would also suggest a buy and hold strategy in most cases as prices seem to be on the rise. Of course, no one can predict nor gaurantee what the markets will do....especially in these turbulent times...
Many sellers are taking advantage of the price increase to get out of a current home, and "right size" while money is still relatively cheap. The gains of 7.1 percent over the last year make this strategy particularly attractive. You may also want to consider the use tax free exchanges as a method to delay taxes on gains.
Either way, this year is poised to be a record year for real estate pricing. A lot will depend on the Federal Reserve, so keep an eye out. If you have any questons or concerns, please feel free to reach out to us!