"By choosing our path, we choose our destination." Quotemaster.org
When you are looking for the quickest and easiest path up to your mountain, take the Mountain Trail Guide Sherpa with you. A good financial advisor, a good economist, and a knowledgeable mortgage professional are like Trail Guide Sherpas. They are standing at the top of the mountain, looking down along every trail. When asked, the financial trail guide can point clients to what looks like the best trail to get to their destination.
Let's take a look down the paths of homeownership:
1. The median home price this week of $363,300 is up over 23% year-over-year. The media is saying it is a Home Affordability Crisis. But remember that Median Home Price does not determine affordability. Affordability is determined by the relationship between home value Appreciation and wages. Appreciation is only up 14% year-over-year. People are also coming back to work with Pandemic Unemployment Assistance Claims falling by over a million.
2. The higher home prices do put pressure on first-time homebuyers. However, first-time homebuyers are still making up 31% of home sales over the last five months. Cash buyers made up 23% of homebuyers, up 16% from last year. Investors purchased 14% of the home sales, down 17%, which is a pandemic low.
3. Inventory of homes for sale is still down 19% year-over-year. Still, Chief Economist for National Association of Realtors, Lawrence Yun, forecasts that we will see more houses being listed for sale later this year.
4. Real estate economists are still predicting that the value of homes will continue to increase, even when mortgage rates start to climb. The serious lack of homes for sale and the tremendous buyer demand are being followed by an emerging Millennial and Z-Generation buyers market eager to own their own homes.
5. Mortgage rates are the lowest we have seen since February. So the big win for homebuyers is to lock in a low, fixed-rate mortgage on a home where they can build equity and wealth.
The best realtors and mortgage professionals want every tool at hand for helping their clients overcome obstacles and feel good about their real estate decisions. Subscribe to one or two reliable real estate market news sources. Connect with your local Multiple Listing Service. Lunch and Learn meetings and real estate sales meetings are great places to learn about various mortgage programs.
