The housing crisis is finally in the rearview mirror as the real estate market moves down the road to a complete recovery. Home values are up, home sales are up, mortgage rates remain low, and distressed sales (foreclosures & short sales) are at their lowest mark in over 8 years nationwide. This year has been, and next year should prove to be, great for real estate. However, there is one thing that may cause the industry to tap the brakes moving forward: a lack of housing inventory. According to the National Association of Realtors (NAR), buyer traffic and demand continues to be the strongest it has been in years. The supply of homes for sale has not kept up with this demand, and lack of supply has driven prices up in many areas as buyers compete for their dream home. This is certainly true in Kitsap County!
Traditionally, the winter months create a natural slowdown in the market. Jonathan Smoke, Chief Economist at realtor.com, points to low interest rates as one of the many reasons why buyers are still out in force looking for a home of their own.
“Overall, the fundamental trends we have been seeing all year remain solidly in place as we enter the traditionally slower sales season, and pent-up demand remains substantial as buyers seek to get a home under contract while rates remain so low.”
NAR’s Chief Economist, Lawrence Yun, points out that the inventory shortage we are currently experiencing isn’t a new challenge by any means:
“Inventory has been extremely tight all year and is unlikely to improve now that the seasonal decline in listings is about to kick in. Unfortunately, there won’t be much relief from new home construction, which continues to be grossly inadequate in relation to demand.”
The recent election did cause a small uptick in mortgage rates as funds were pulled from bonds and moved into stocks, but rates still remain at historic low levels and should continue to remain low for some time to come. Low rates will continue to create a climate favorable to buyers and keep demand strong. So far I am seeing no decline in numbers of buyers even in the face of declining inventory.
Healthy labor markets and job growth have created more and more buyers who are not just ready and willing to buy but are also able to do so. If you are debating whether or not to put your home on the market, NOW is the time. Buyers are actively looking, and yours may be just the home they’ve been waiting for!
As always, if you have questions or would like more information, feel free to ask. I’m here to help!