The numbers are in: Albuquerque’s July Preliminary Data
(Transcript Snippet): “Tracy:
You’ve got some data I’m dying to get to
Tego:
Yeah, I, to talk about, so yeah, so you’ve heard here first is this is July preliminary data. Obviously we haven’t finished the month yet, or we’re just finishing the month. So it’s very preliminary, but, but a couple of things that, you know, I took out of it is total number of homes on the market is down 18% from last year. And of course, last year in July, we, we saw a very big steep decline in the number of homes on the market. And obviously may June into July of last year. So we’re even down lower than that right now, the number of homes coming on the market is equal with last year, because what happened, Tracy, as you know, we had that obviously may June where people just stop putting homes into market July last year, they started to come back in. People were getting comfortable with it. And this year, you know, it’s kind of equal to that, but we’re not seeing a huge influx of number of homes on the market, which we could definitely right
Tracy:
There, we’ve increased, but now we’re selling them again at the same rate they’re coming on the market. So we’re staying in that thousand range versus 700.
Tego:
And to put that in perspective for folks, if you think about, okay, they’re about a thousand homes for sale in the greater Albuquerque area, we could have four or five, 6,000 homes on the market and still be in what’s considered a balanced market. Yeah, yeah. So, so know that’s just how far behind we are on homes. And we’d have to get to that quote balanced market before
Tracy:
We see prices balance out.
Tego:
Before we start to see price declines, I want to be careful with that, but really it would take a huge buildup in the number of homes in the market and to turn to a buyer’s market. It’s, we’ve got a long way to go before we get there. So so the stats and the number of number of homes under contract, these are pending sales up 10% so far this month from, and again, we’re talking about July versus July last year, July last year was a booming month for pending sales. It was the second highest number of pending sales ever in our market next to June of last year. So June of last year was the number one ever July was the second most. And now this month looks like it’s going to be the third most. Well, it’ll, it’s, it’s going to be a big month. So the buyers are still out there. There’s no doubt about it. Right? Right.
Tracy:
Well, we know that when we talk to our lenders and just all of our agents, they’ve got buyers, they’re waiting for the right home to come on market or they’re making offers on homes and so are other people. So they’re still looking for houses.
“60% of people who were looking to buy a home in 2020 said they’d prefer new construction to an existing home.”
However, it seems buyers are now shifting their preferences back to existing homes.
The latest Consumer Confidence Survey reveals the percentage of Americans planning to buy a home in the next six months is virtually the same as it was back in March. However, the percentage that plan to buy a newly constructed home is lower for that same period.
NAHB confirms this sentiment in their latest Housing Trends Report. The organization explains that existing homes are now the top preference among today’s buyers. Here’s a breakdown of those findings:
Why the shift?
There are several reasons why buyer preference is shifting. Here are two that impact purchasers looking to move in now:
The process may move faster. Builders may not be able to guarantee when the house will be complete and ready for move-in due to supply chain challenges with materials like lumber and appliances. If you buy an existing home, not only is it ready, it also likely has a refrigerator, range, and other necessary home appliances already.
There are no unexpected costs during the buying process. With the price of land, labor, and lumber being so volatile, many builders are including an escalation clause in the price negotiation to cover rising expenses. With an existing home, the final price you will pay is negotiated upfront.
Bottom Line
If you’re a homeowner looking to sell, your house is more attractive to a greater number of buyers as compared to earlier in the year. This might be the time for us to connect to discuss the possibility.
Looking for your Albuquerque home? Here’s what you should do
(Transcript Snippet): “Tego:
If you’re looking for a home, what you should, what should you be doing
Tracy:
Well? So one of the things that I would suggest is let’s not give up let’s, you know, put your parameters together, keep looking this week to go. I had the opportunity to stop in at a few sales offices of new home builders and just chat with them. And they actually have some homes ready to buy today. And honestly, this weekend, they have some great incentives out there for buyers towards their closing costs or upgrades. If you want to build a house and pick your lot, but they do have some that are done or almost done. So there’s a great option. You’re not competing as much. You walk into the sales office and pick the house, pick the floor plan, or you pick one that’s already done. So I stopped in a Dr. Horton, Hakes brothers and a Pulte this week. And wow, they’ve got some beautiful homes in neighborhoods. Now most of the newer homes are in that 300 and up range up to 500. And even above that in some of the neighborhoods, but boy, there’s one way to find a house. So
Tego:
Yeah, you know, new construction, let’s just talk about that real quick. There is a lot of new construction going on. There are projects, you know, that we’re aware of in the pipeline that are coming on. And so there are, there’s going to be a fair amount of new construction over the next few years, for sure. In the Albuquerque area. Although I looked at building permits, we had a spike up in may and then building permits for the Albuquerque area, dropped off again and are just kind of flat. And I think that’s partly this whole kind of supply chain problem, labor problem, material cost problems that a lot of the, the building industry has seen. And that’s not just residential construction. I mean, everybody out there knows that it’s, it’s everywhere you know, supply chain problems. So anyway, that that new construction is coming. It’s just not enough for, for the, the demand that we have out there right now. And it’s probably going to continue that way. So if somebody is interested in new construction, which should
Tracy:
They should call us first, right? Four, four, eight, eighty eight, eighty eight, we can help you hone in on neighborhoods and areas and price points and availability. And when we find the right one, we can help negotiate the right offer and contract for you to get that house you need.
Home prices continue to rise as we move through the summer, and that’s good news for sellers who are looking to maximize their home’s potential. If you’re on the fence about whether to list your house now or later, the question you should really ask is: will this price appreciation last?
Here’s what three leading industry experts have to say about what lies ahead:
Lawrence Yun, Chief Economist, National Association of Realtors (NAR):
“At a broad level, home prices are in no danger of a decline due to tight inventory conditions, but I do expectprices to appreciate at a slower pace by the end of the year.”
“The imbalance between robust demand and dismal availability of for-sale homes has led to a continual bidding over asking prices, which reached record levels in recent months . . . . Nevertheless, with more new listings and new home construction, home price acceleration that has built momentum, and continues to reach new highs, will likely slow later this summer but remain in double digits.”
“Many sellers are going to take advantage of higher prices. This summer is going to signal the move to the next chapter, and this will very much be the year they’re going to put their home on the market.”
What It Means for You:
The experts agree that the summer months give sellers a great opportunity to capitalize on today’s home prices. And while prices aren’t expected to depreciate, the rise in prices is forecast to moderate over the next few years. That means selling your house today could set you up for a bigger win.
Bottom Line
Listen to the experts. If you’re ready to make a move, let’s connect to discuss selling your house sooner rather than later so you can take advantage of today’s home price appreciation before it moderates.
According to recent data from realtor.com, median rental prices have reached their highest point ever recorded in many areas across the country. The report found rents rose by 8.1% from the same time last year. As it notes:
“Beyond simply recovering to pre-pandemic levels, rents across the country are surging. Typically, rents fluctuate less than 1% from month to month. In May and June, rents increased by 3.0% and 3.2% from each month to the next.”
If you’re a renter concerned about rising prices, now may be the time to consider purchasing a home.
Monthly Rents Are Higher Than Monthly Mortgage Payments
When you weigh your options of whether to buy a home or continue renting, how much you’ll pay each month is likely top of mind. According to the National Association of Realtors (NAR), monthly mortgage payments are rising, but they’re still significantly lower than the typical rental payment. NAR indicates the latest data on homes closed shows the median monthly mortgage payment is $1,204.
By contrast, the median national rent is $1,575 according to the most current data provided by realtor.com. In other words, buyers who recently purchased a home locked in a monthly payment that is, on average, $371 lower than what renters pay today(see graph below):
Rents Are Rising Sharply, and They Continue To Increase
The difference in monthly housing costs when comparing renting and homebuying today is significant, but many would-be homebuyers wonder about the future of rental prices. If we look to historical Census data as a reference, the median asking rent has risen consistently since 1988 (see graph below):The rise in rent over time clearly shows one of the major advantages homeownership has over renting: stable housing costs. Renters face increasing costs every year. When you purchase your home, your mortgage rate is locked in for 30 years, meaning your monthly payment stays the same over time. That gives you welcome peace of mind and predictability for many years ahead.
Bottom Line
With rents continuing to rise across the country, renters should consider if now is the right time to buy. There are multiple benefits to buying sooner rather than later. Let’s discuss your options so you can make your most powerful decision.
