If you’re a buyer right now, you’re experiencing firsthand what is possibly the most competitive market we’ve ever seen. Homes are going under contract at incredible speeds and the offers made are very aggressive.
We are constantly hearing about low inventory; Milwaukee/Waukesha County, especially, are always in need of additional inventory. So what exactly is happening? There are some additional factors at play other than lack of inventory.
Let’s break it down:
Record Low Mortgage Rates: Due to the nation’s economic changes, 12 million homeowners were able to take advantage of securing the lowest rates history has ever seen.
Strong Demographics: 33% of homebuyers today are first-time buyers with nothing to sell, meaning they can be nimble in making non-contingent offers.
Delayed Downsizing: Baby boomers are delaying downsizing by moving into assisted living, nursing homes, or in with family due to the pandemic, holding onto those homes that younger families need.
New Build Prices: Lumber prices continue to spike, with futures up 35% on top of the 170% rise we have already witnessed over the last ten months.
Pandemic Housing Policy: The freeze on foreclosures and evictions has put a pause on some potential market movement.
Even with these factors at play, it’s important that buyers don’t give up. Have a strategy and be sure to have realistic expectations.
With interest rates expected to rise to more normalized levels beginning in April, we’ll start to see a more even market in the coming months. If you’re a seller in the meantime, take advantage of this market in your favor—we need houses!
If you know of anyone looking to buy or sell their home, feel free to reach out!
