A lot of buyers now are more prone to buying a home than previously. I have a few thoughts about why that is.
Buying a Salt Lake City home? Search all homes for sale
Why is buyer optimism higher than we’ve ever seen it? Today, I’d like to go over a couple reasons for this mindset.
Fannie Mae recently did a study that demonstrated that a large number of buyers were more prone to and optimistic about buying a home. If you think about inventory from a national level, you’ll get some interesting numbers. We are about 6.5% lower in inventory compared to last year, and yet, we’re about 6.9% higher in appreciation, price, and growth.
“TYPICALLY, THE SUCCESS OF THE MARKET IS TYPICALLY TIED TO ECONOMIC FACTORS AND GROWTH—TWO AREAS IN WHICH WE ARE DOING FANTASTIC.”
So with that in mind, what is giving buyers the sense of optimism we’ve seen?
1. Interest rates have remained pretty low over the year. Even though prices are rising, interest rates have gone down and have actually made it more affordable to purchase, despite that change.
2. The demographic of who’s on the market has shifted. When Fannie Mae did the study, they found that the average homeowner’s income was around 125% of someone who was buying. Right now, it’s actually closer to 150%. Millennials who were previously holding off on entering the market are now beginning to look at purchasing homes, as opposed to renting.
3. There has been steady job growth. Because of this growth, the market is starting to look appealing to more people.
If you’re a buyer, know that our market is good, interest rates are fantastic, and inventory is excellent. If you’re a seller, just know that there is a market of people looking to purchase. We expect to see a great market over the next few years as well. The world of real estate can always change, but typically, the success of the market is typically tied to economic factors and growth—two areas in which we are doing fantastic.