TwoBrightSpotsfor Today’sHomebuyers
There’snoarguingthepastfewyearshavebeen challengingforhomebuyers,especiallyonthe affordabilityfront.Andifyou’retryingtobuyahome, it’seasytoworryyouwon’tbeabletofindonein yourbudget.Buthere’swhatyouneedtoknow.
Thenumberofhomesforsalehasgrownawhole lotlatelyandthat’strueforbothexisting(previously livedin)andnewlybuilthomes.Here’salookat thosetwobrightspotsforbuyersrightnowandwhy theymaymakeitabiteasiertofindthehome you’vebeenlookingfor.
1.ThereAreMoreExistingHomesforSale
DatafromRealtor.comsaysthenumberofexistinghomesforsaleimprovedbyanimpressive 22%in2024.Andexpertssayyourpoolofoptionsisexpectedtogetevenbetterthisyear. Forecastsshowinventoryisprojectedtogrowanother11-15%bytheendof2025(see graphbelow):
2025For-Sale
InventoryForecasts
Thisisgoodnewsforyoursearch.Ifyou haven’tseenahousewithallthefeatures youneed,justknowthat,asthenumberof homesforsalegrows,you’llhavemore optionstochoosefrom.Thatmeansabetter chanceoffindingahomethatchecksall yourboxes.AsRalphMcLaughlin,Senior EconomistatRealtor.com,says:
“Itcouldbeaparticularlygoodtimeto getoutintothemarket...you'regoing tohavemorechoice.Andthat'snot somethingthatbuyershavereallyhadmuch overthepastseveralyears.”
2.ThereAreMoreNewlyBuiltHomesontheMarket
AccordingtodatafromtheCensusandtheNationalAssociationofRealtors(NAR),32.5%,or roughly1in3,homesonthemarketrightnowarenewlybuilthomes.That’smorethanthenorm (seechartsbelow).Butdon'tworry,that'snotbecausebuildersareoverdoingit–it’sjustthat they’retryingtocatchupafteryearsofunderbuilding.
From1983-2019,anaverageofonly13% ofhomesforsalewerenewlybuilt
AsofJanuary2025,over30%ofall homesforsalewerenewlybuilt 32.5% LatestData
Source:NAR
Andthebestpartis,sincebuildershavebeenfocusingonsmallerhomeswithlowerpricepoints, youmayactuallyfindoutnewbuildsarelessexpensivethanyou’dexpect.So,whilealotof peoplewriteoffnewconstructionbecauseit’seasytoassumethecostsarewayhigher,lately, thatpricegapisn’tasbigasyou’dthink.AsCNETsays:
“Ifyouliveinanareawherethere'salotofnewconstructionhappening...youmightbeableto purchaseanewhouseforapricesimilartoorevenlessthanapre-ownedone.”
Ifyouhaven’tbeenabletofindahomethat’sinyourbudget,it’stimetoaskyouragentaboutnew builds.Ifyoudon’t,youmaybecuttingyourpoolofoptionsbyaboutathird.
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Morechoicescouldbethekeytounlockingyourhomebuyinggoalsin2025.Reachoutifyou wanttoseewhat’savailableinandaroundourarea.
ExpertForecastsforthe 2025HousingMarket
Wonderingwhat’sinstoreforthehousingmarketthisyear?Andmorespecifically,whatitall meansforyouifyouplantobuyahome?Here’swhattheexpertssayliesahead.
WillMortgageRatesComeDown?
Everyone’skeepinganeyeonmortgageratesandwaitingforthemtocomedown.So,the questionisreally:howfarandhowfast?Thegoodnewsisthey’reprojectedtoeaseabitin 2025.Butnotbymuch.Thatmeansyoushouldn’texpecttoseeareturnof3-4%mortgagerates. Expertsareforecastingratescouldsettleinthemid-6%rangebytheendoftheyear(see chartbelow):
Butyoushouldremember,thiswillcontinuetochangeasnewinformationbecomesavailable. Expertforecastsarebasedonwhattheyknowrightnow.Andsinceeverythingfrominflationto economicdrivershaveanimpactonwhereratesgofromhere,braceforsomeratevolatility. Don’tgetcaughtupintheexactnumbershereandtrytotimethemarket.Instead,focusonthe overalltrendandthatevenasmalldeclinecanhelpbringdownyourfuturemortgagepayment.
WillHomePricesFall?
Theshortanswer?Notlikely.Whilemortgageratesareexpectedtoeaseabit,homepricesare projectedtokeepclimbinginmostareasjustatamorenormal,sustainablepace.Ifyou averagetheexpertforecaststogether,you’llseepricesareexpectedtogoupabout3%in2025, withmostofthemhittingsomewhereinthe3to4%range(seegraphbelow):
Sodon’texpectasuddendropthat’llscoreyouabigdealifyou’rethinkingofbuyingthisyear. Whilethatmaysounddisappointingifyou’rehopingpriceswillcomedown,refocusonthis.It meansyouwon’thavetodealwiththesteepincreaseswesawinrecentyears,andyou’llalso likelyseeanyhomeyoudobuygoupinvalueafteryougetthekeysinhand.Andthat’sactually agoodthing.
Keepinmind,though,thehousingmarketishyper-local.So,thiswillvarybyarea.Somemarkets willseeevenhigherprices.Andsomemayseepriceslevelofforevendipalittleifinventoryis upinthatlocation.Inmostplacesthough,priceswillcontinuetorise(astheyusuallydo).
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Let’sconnectsoyoucangetthescooponwhat’shappeninginourareaandadviceonhowto makeyournextmoveasmartone.
Expertssayrateswillcomedownslightlyintheyearahead–butsomevolatilityisexpected.
Averagemortgagerateswilldeclinemodestlybutremain above6percent,withlikelyboutsofvolatility.
So,youshouldn'ttrytotimethemarket.Instead,it'sbettertofocuson howevenasmallchangeimpactsyourfuturemortgagepayment.
TheRealBenefitsof BuyingaHomeThisYear
ArecentreportfromBankofAmericahighlights that70%ofprospectivebuyersfearthelongtermconsequencesofrenting,includingnot buildingequityanddealingwithrisingrents.
Ifyou’reonthefenceofwhethertorentorbuy, here’swhatyoushouldknow.Ifyou’reableto makethenumberswork,buyingahomehas powerfullong-termfinancialbenefits.
BuyingBuildsWealthOverTime
Buyingahomeallowsyoutoturnyourmonthlyhousingcostsintoalong-terminvestment.That’s because,asshownindatafromtheCensusandtheDepartmentofHousingandUrban Development(HUD),homepricestendtoincreaseovertime(seegraphbelow):
Risinghomepricesdirectlybenefithomeowners.That’sbecausewhenyouownahome,you buildequity—meaningyourownershipstakeinyourhomegrowsasyoupaydownyour mortgageandyourhome'svalueappreciates.Andthat,inturn,makesyournetworthgrow,too.
RentingComeswithRisingCosts
Rentingmayfeelmoreaffordableintheshortterm,especiallyrightnowwithtoday’shomeprices andmortgagerates.Buttherealityis,overtime,rentalmostalwaysgoesup.Takealookatthe dataandyoucanseethatplayout.AccordingtoCensusdata,rentshavesignificantlyincreased overthedecades(seegraphbelow):
Thismeansifyoudecidetorent,you’lllikelyfacegrowingexpenseseachtimeyoureneworsign anewlease–andthat’llhappenwithoutbuildinganywealthinreturn.Plus,thoserisingcosts maymakeithardertosaveuptobuyahomedowntheroad.
Rentingvs.Buying:TheLong-TermImpact
Whenyouownahome,yourpaymentsareaninvestmentinyourfuture.Renting,ontheother hand,meansyourmoneyisgoneforgood—ithelpsyourlandlordbuildequity,notyou.
Rentingisagoodoptionforthosenotready(orable)tobuytoday.Butifyouareabletobuyat today'sratesandprices,ithelpsyoubuildequityandsetsyouupforlong-termfinancialsuccess. So,eventhoughrentingmayseemeasiernow,itcan’tmatchthebenefitsofhomeownership. $0
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Ifyoucanaffordit,takecontrolofyourfinancialfuturebymakinghomeownershippartofyour plan.It’saninvestmentyouwon’tregret.
Source:Census
There’sneveraone-size-fits-allanswertowhether nowistherighttimetobuyahome...There’salso nowaytopredictpreciselywhatthemarketwilldoin thenearfuture...Perfectlytimingthemarket shouldn’tbethegoal.Thisdecisionshouldbe determinedbyyourpersonalneeds,financialmeans andthetimeyouhavetofindtherighthome.
TimeintheMarketBeats TimingtheMarket
Tryingtodecidewhetheritmakesmoresensetobuyahomenoworwait?There’salottoconsider, fromwhat’shappeninginthemarkettoyourchangingneeds.Butgenerallyspeaking,aimingtotime themarketisn’tagoodstrategy—therearetoomanyfactorsatplayforthattoevenbepossible.
That’swhyexpertsusuallysaytimeinthemarketisbetterthantimingthemarket.
Inotherwords,ifyouwanttobuyahomeandyou’reabletomakethenumberswork,doingit soonerratherthanlaterisusuallyworthit.Bankrateexplainswhy:
“Nomatterwhichwaytherealestatemarketisleaning,though,buyingnowmeansyoucanstart buildingequityimmediately.”
Here’ssomedatatobreakthisdownsoyou canreallyseethebenefitofbuyingnow versuslaterifyou’reableto.Each quarter,FannieMaereleasestheHome PriceExpectationsSurvey.Itasksoverone hundredeconomists,realestateexperts, andinvestmentandmarketstrategistswhat theyforecastforhomepricesoverthenext fiveyears.Inthelatestrelease,expertsare projectinghomepriceswillcontinuetorise throughatleast2029justataslower, morenormalpacethantheydidoverthe pastfewyears(seethegraph):
December–December, asForecastinQ42024 EstimatedHome
Butwhatdoesthatreallymeanforyou?Togivethesenumberscontext,thegraphbelowusesa typicalhomevaluetoshowhowitcouldappreciateoverthenextfewyearsusingthoseHPES projections(seegraphbelow).Thisiswhatyoucouldstarttoearninequityifyoubuyahomein early2025.
$83,251
Potentialgrowthinhouseholdwealthoverthenext 5yearsbasedsolelyonincreasedhomeequity ifyoupurchasea$400KhomeinJanuary2025.
$400,000$415,120$430,189$446,149$464,129
$483,251 202520262027202820292030
BasedonpriceappreciationprojectedbytheHomePriceExpectationsSurvey
Inthisexample,let’ssayyoubought$400,000homethisJanuary.Basedontheexpertforecasts fromtheHPES,youcouldgainmorethan$83,000inhouseholdwealthoverthenextfiveyears. That’snotasmallnumber.Ifyoukeeponrenting,you’relosingoutonthisequitygain.
Andwhiletoday’smarkethasitsfairshareofchallenges,thisiswhybuyingisworthitin thelongrun.
Ifyouwanttobuyahome,don’tgiveup.Therearecreativewayswecanmakeyourpurchase possible.Fromlookingatmoreaffordableareas,toconsideringcondosortownhomes,oreven checkingoutdownpaymentassistanceprograms,thereareoptionstohelpyoumakeithappen. Sosure,youcouldwait.Butifyou’rejustwaitingitouttoperfectlytimethemarket,thisiswhat you’remissingouton.Andthatdecisionisuptoyou.
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Ifyou’retornbetweenbuyingnoworwaiting,don’tforgetthatit’stimeinthemarket,nottiming themarketthattrulymatters.Let’stalkthroughitifyouhavequestions.
Sources:FannieMae,HPES
TheBiggest MistakesBuyers AreMakingToday
Noonelikesmakingmistakes,especiallywhenthey happeninwhat’slikelythebiggesttransactionofyour life—buyingahome.That’swhypartneringwithatrusted agentissoimportant.Anexpert’sinsightswillhelpyou avoidthetopmistakeshomebuyersaremakingtoday.
1.TryingToTimetheMarket
Manybuyersaretryingtotimethemarketby waitingforhomepricesormortgageratesto drop.Thiscanbeareallyriskystrategy becausethere’ssomuchatplaythatcanhave animpactonthosethings.AsRickSharga, CEO,CJPatrickCompany,says:
“Don’ttrytotimethemarket—itrarely workswithstocks,andalmostneverworks whenitcomestobuyingahouse.Onlybuy whatyoucanreasonablyaffordgiven whateverthecurrentmarketconditionsare.”
2.BuyingMoreHouseThanYou CanAfford
Ifyou’retemptedtostretchyourbudgeta bitfurtherthanyoushould,you’renot alone.Anumberofbuyersaremakingthis mistakerightnow.
Butthetruthis,it’sactuallyreallyimportant toavoidoverextendingyourbudget, especiallywhenotherhousingexpenses likehomeinsuranceandtaxesareonthe rise.Youwanttotalktotheprostomake sureyouunderstandwhat’llreallyworkfor you.Bankrateoffersthisadvice:
“Focusonwhatmonthlypaymentyoucan affordratherthanfixatingonthemaximum loanamountyouqualifyfor.Justbecause youcanqualifyfora$300,000loan doesn’tmeanyoucancomfortably handlethemonthlypaymentsthatcome withitalongwithyourotherfinancial obligations.”
3.MissingOutonAssistancePrograms
Savingupfortheupfrontcostsofhomeownershiptakessomecarefulplanning.Youhavetothink aboutyourclosingcosts,downpayment,andmore.Andifyoudon’tworkwithateamof experiencedprofessionals,youcouldmissoutonprogramsouttherethatcanmakeabig differenceforyou.Thisishappeningmorethanyourealize.
AccordingtoRealtor.com,almost80%offirst-timebuyersqualifyfordownpayment assistancebutonly13%actuallytakeadvantageofthoseprograms.So,talktoalenderabout youroptions.Whetheryou’rebuyingyourfirsthouseoryourfifth,theremaybeaprogramthat canhelp.
4.NotLeaningontheExpertiseofthePros
Thislastonemaybethemostimportantofall.Theverybestwaytoavoidmakinga costlymistakeistoleanonapro.Withtherightteamofexperts,youcaneasilydodge anymissteps.
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Thegoodnewsisyoudon’thavetodealwithanyoftheseheadaches.Let’sconnectsoyou haveaproonyoursidewhocanhelpyouavoidthesecostlymistakes.
ThingsToAvoid AfterApplying foraMortgage
Consistencyisthenameofthegame afterapplyingforamortgage.Besure todiscussanychangesinincome, assets,orcreditwithyourlender,so youdon’tjeopardizeyourapplication.
Don’tchangebankaccounts.
Don’tdepositcash intoyouraccounts beforespeaking withyourbank orlender.
Don’tapplyfornewcreditor closeanycreditaccounts.
Don’tco-signother loansforanyone.
Don’tmakeany largepurchases.
Thebestplanistofullydiscloseanddiscussyourintentions withyourlenderbeforeyoudoanythingfinancialinnature.
TheTop5ReasonsYouNeedan AgentWhenBuyingaHome
Whenitcomestobuyingahome,expertadvicefromatrustedrealestateagentispriceless,now morethanever.Andhere’swhy.Arealestateagentdoesalotmorethanyoumayrealize.
Youragentisthepersonwhowillguideyouthrougheverystepwhenbuyingahomeandlookout foryourbestinterestsalongtheway.Theysmoothoutacomplexprocessandtakeawaythe bulkofthestressofwhat’slikelyyourlargestpurchaseever.Andthat’sexactlywhatyouwant anddeserve.
ThisisatleastpartofthereasonwhyasurveyfromBrightMLSfoundanoverwhelmingmajority ofpeopleagreeanagentisakeypartofthehomebuyingprocess(seevisualbelow):
91%
Ofrespondentsagree"Itwouldbe verystressfultonavigatethe homebuyingprocesswithouta realestateagentorbroker.”
Ofrespondentsbelieve "Arealestateagentorbroker isanessential,trusted advisorforahomebuyer." 87%
1.DeliverIndustryExpertise:Therightagent–theprofessional–willcoachyou througheverythingfromstarttofinish.Withprofessionaltrainingandexpertise,agents knowtheinsandoutsofthebuyingprocess.Andintoday’scomplexmarket,thewayreal estatetransactionsareexecutedisconstantlychanging,sohavingexpertadviceonyour sideisessential.
2.ProvideExpertLocalKnowledge:Inaworldthat’spoweredbydata,agreatagent canclarifywhatitallmeans,separatefactfromfiction,andhelpyouunderstandhow currentmarkettrendsapplytoyouruniquesearch.Fromhowquicklyhomesaresellingto thelatestlistingsyoudon’twanttomiss,theycanexplainwhat’shappeninginyour specificlocalmarketsoyoucanmakeaconfidentdecision.
3.ExplainPricingandMarketValue:Agentshelpyouunderstandthelatestpricing trendsinyourarea.What’sahomevaluedatinyourmarket?Whatshouldyouthinkabout whenyou’remakinganoffer?Isthisahousethatmighthaveissuesyoucan’tseeonthe surface?Noonewantstooverpay,sohavinganexpertwhoreallygetstruemarketvalue forindividualneighborhoodsispriceless.Anofferthat’sbothfairandcompetitiveintoday’s housingmarketisessential,andalocalexpertknowshowtohelpyouhitthemark.
4.ReviewContractsandFinePrint:Inafast-movingandheavilyregulatedprocess, agentshelpyoumakesenseofthenecessarydisclosuresanddocuments,soyouknow whatyou’resigning.Havingaprofessionalthat’strainedtoexplainthedetailscouldmake orbreakyourtransactionandiscertainlysomethingyoudon’twanttotrytofigureouton yourown.
5.BringNegotiationExpertise:Fromoffertocounterofferandinspectiontoclosing, therearealotofstakeholdersinvolvedinarealestatetransaction.Havingsomeoneon yoursidewhoknowsyouandtheprocessmakesaworldofdifference.Anagentwill advocateforyouastheyworkwitheachparty.It’sabigdeal,andyouneedapartnerat everyturntolandthebestpossibleoutcome.
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Realestateagentsarespecialists,educators,andnegotiators.Theyadjusttomarketchanges andkeepyouinformed.Andkeepinmind,everytimeyoumakeabigdecisioninyourlife, especiallyafinancialone,youneedanexpertonyourside.Expertadvicefromatrusted professionalispriceless.
Thecomplexitiesofthecurrentconditions meanthat,nowmorethanever,it’ssmartto leanontheguidanceofanexperiencedlocal realestateagent.Ifyouwanttoenterthe housingmarketin2025,whetherasabuyer oraseller,letaproleadthewayforyou.
Doyouhavequestionsabout somethingyoureadhereorabout buyingahomeingeneral?Don’t hesitatetoreachout.
Whetherit’shousingmarket-related, orsomethingaboutyourspecific situation,I’vehelpedotherbuyers findsuccess–andIcanhelpyoutoo.
