The First Heritage Realty Blog
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Low Housing Inventory Is a Sweet Spot for Sellers [INFOGRAPHIC]
Some HighlightsToday’s housing inventory is still well below more normal years.This low inventory is why homes that are priced right are still selling quickly and seeing multiple offers.If you want to sell your house, now is a great time because inventory is still low. Contact a trusted real estate agent to start the process.
How Remote Work Expands Your Homebuying Horizons
Even as some companies transition back into the office, remote work remains a popular choice for many professionals. So, if you currently enjoy working from home or hope to be able to soon, you’re not alone. According to a recent survey, most working professionals want to work either fully remote or hybrid (see below):This trend is good news if you’re looking to buy a home because a remote or hybrid work setup can help you overcome some of today’s affordability and housing inventory challenges.More Work Flexibility Equals More Home OptionsRemote or hybrid work opens up a world of opportunities. That’s because it allows you to broaden your search for your next home since you’re no longer limited to living close to your workplace. With the freedom to work from anywhere, you can explore more affordable areas that may be located farther away from bustling city centers or your office. This flexibility can be a game changer while higher mortgage rates are making it difficult for some homebuyers to afford a home.An article from the New York Times (NYT) highlights how remote work can greatly assist you in overcoming that challenge:“. . . take advantage of the opportunity remote work has presented to move to more affordable communities (either farther out in the suburbs, or in another part of the country).”And, since the supply of homes for sale is still so low, another key challenge for you today may be finding something with all of the features you want and need. Because remote work allows you to broaden your search radius to include additional areas, you may actually have less trouble finding a home with the features you want the most because you’ll have a bigger pool of options to pick from.Working remotely gives you the flexibility to find an affordable home with the features you want. In other words, you have a better chance of getting what you need without blowing your budget. Bottom LineWorking remotely not only gives you more flexibility in your job but also presents a great chance to broaden your search for a home. Since you're not limited to a specific location, you have the opportunity to explore more options. Connect with a local real estate agent to discuss how this can expand your choices and help you find the perfect home.
Renting or Selling Your House: What's the Best Move?
If you’re a homeowner ready to make a move, you may be thinking about using your current house as a short-term rental property instead of selling it. A short-term rental (STR) is typically offered as an alternative to a hotel, and they’re an investment that’s gained popularity in recent years.While a short-term rental can be a tempting idea, you may find the reality of being responsible for one difficult to take on. Here are some of the challenges you could face if you rent out your house instead of selling it.A Short-Term Rental Comes with ResponsibilitiesSuccessfully managing your house as a short-term rental takes a lot of time and effort. You’ll have to juggle tasks like dealing with reservations, organizing check-ins, and tackling cleaning, landscape, and maintenance duties. Any one of those can feel demanding, but all together it’s a lot to handle.Short-term rentals experience high turnover rates, as new guests check in and out frequently. This home traffic can lead to increased wear and tear on your property—meaning you may need to make more frequent repairs or replace your furniture, fixtures, and appliances more often. Think through your ability to make that level of commitment, especially if you plan to use a platform that advertises your rental listing. Most of them have specific requirements hosts must meet. An article from Bankrate explains:"Managing a rental property can be time-consuming and challenging. Are you handy and able to make some repairs yourself? If not, do you have a network of affordable contractors you can reach out to in a pinch? Consider whether you want to take on the added responsibility of being a landlord, which means screening tenants and fielding issues, among other responsibilities, or paying for a third party to take care of things instead."There’s a lot to consider before taking the leap and converting your house into a short-term rental. If you aren’t ready for the work it takes, it could be wise to sell instead.Short-Term Rental RegulationsAs the short-term rental industry continues to grow, regulations have increased. Legal restrictions commonly include limits on the number of vacation rentals in a particular location. This is especially true in larger cities and tourist destinations where there may be concerns about overcrowding or housing shortages for permanent residents. Restrictions may also apply to the type of property that can be used for short-term rentals.Many cities also require homeowners to obtain a license or permit before renting out their properties. Nick Del Pego, CEO at Deckard Technologies, explains:“Renting short-term rentals is considered a business by most local governments, and owners must comply with specific workplace regulations and business licensing rules established in their local communities.”It is important to thoroughly check whether short-term rentals are regulated or prohibited by the local government and your homeowners association (HOA) before even considering renting out your home. Bottom LineConverting your home into a short-term rental isn’t a decision you should make without doing your research. To decide if selling your house is a better alternative, talk with a local real estate agent today.
Momentum Is Building for New Home Construction
If you’re in the process of looking for a home today, you know the supply of homes for sale is low because you’re feeling the impact of having a limited pool of options. And, if your biggest hurdle right now is that you’re having trouble finding something you like, don’t forget that a newly built home is a great option.As a recent article from the National Association of Realtors (NAR) says: “Home buyers continue to be met with limited housing options during what’s typically the real estate market’s busiest season. . . . The current supply of existing homes is about half the level it was in 2019 . . . Meanwhile, the market for new construction is a bright spot.”Here’s a look at a key metric that shows just how much new home construction is ramping up nationwide. It’s called new residential completions. Basically, completions are newly built homes that are finished and ready to move into.The graph below uses data from the Census to show the trend of new-home completions over time, including the long-term average for the number of finished housing units (shown in black on the graph):As you can see on the left (shown in orange), leading up to the housing crash, builders exceeded that average. The result was an oversupply of homes on the market, so home values declined. That was one of the factors that led to the housing crash back in 2008.Since then, the level of new home construction has fallen off, and builders haven’t built enough homes to meet the historical average (shown in red). That underbuilding left the housing market with a multi-year inventory deficit. And, that deficit is part of what makes inventory so low right now.But, here’s the good news. The green on the right shows that according to the latest report from the Census, builders are matching the long-term average right now. And that means they’re bringing more newly built homes to the market than they have in recent memory.And residential starts and permits are also gaining momentum. Starts are homes where the construction has officially kicked off. Permits are homes where builders are planning to break ground soon. Since both are up, it’s a sign there are even more newly built homes coming soon.What This Means for YouMore newly built homes in various stages of the construction process means your pool of options just got bigger. If you’re looking to move right now and timing is important to you, reach out to a local real estate professional to explore the homes that were recently completed in your area. If construction is done on those homes, you should be able to move in quickly.But, if you can wait a bit and the idea of customizing a home from the ground up appeals to you, ask that same agent about the homes in your area that are in the process of being built. If you buy a home that’s still in the works, you can help pick the features and finishings along the way. And when none of the homes you’ve looked at so far are to your liking, being able to tailor one to your taste may be your best option.Either way, a trusted real estate agent is a crucial part of the process. They’ll know exactly what’s available in your area and can base their recommendations on your unique needs, desired neighborhoods, and more.Bottom LineSo, if you're having trouble finding a home you like while inventory is so low, it may be time to consider looking into new-home construction. If you'd like to start that conversation, reach out to a trusted local real estate professional who’s an expert on what’s available in your area.
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