By Realty Times
If there’s been one surprise during the pandemic, it’s the real estate market. The market took a steep dive in March 2020 as the pandemic made home viewings nearly impossible.
The market rebounded a few months later and never looked back. The last two years have been a wild ride, with home values soaring. Remote workers realized that they can relocate, driving up buyer demand.
There seems to be nonstop talk about the current market and it continues to shift and change. The only way to make sense of it all is to follow the latest real estate market news.
Read on to learn what the latest market news is in real estate? Read on as we explore the latest news and trends impacting the real estate market.
Is the Real Estate Market Finally Cooling Off?
This is a million-dollar question for anyone interested in buying or selling real estate.
To answer that question, let’s take a look at what’s been driving the insanely hot real estate market. One of the main factors is low inventory.
This means the number of homes available for sales, whether they’re new builds or existing homes. Construction companies haven’t kept up with population growth and housing demand for several years before the pandemic.
Once the pandemic hit, they had to stop building new homes altogether. Then they faced supply chain issues and rising construction costs.
Existing home sellers wanted to hold off until the pandemic subsided. The market moved so quickly and buyer demand was so high, that sellers didn’t sell because they feared they wouldn’t find something comparable and affordable.
Buyers wanted to take advantage of low interest rates. They also realized they could sell a condo in San Francisco, and buy a five-bedroom home in Boise. They’d have money left over and keep their job.
Those things left buyers competing with record offers, driving up home values across the country.
The Fed recognized that the housing market was a bit out of control. Inflation rose as well, prompting The Fed to raise interest rates by .5% in early May. There are likely going to be more rate hikes in the near future.
Early real estate market news suggests that buyers are waiting for housing prices to come down. Sellers aren’t waiting for more interest rate hikes, so there’s a slight increase in inventory.
Investors Buying at a Record Pace
Real estate investors are making the news, but not for the best reasons. Wall Street companies have been buying up homes, but they’re not the only ones.
There are plenty of individual investors buying investment properties. Together, they made up 18% of all real estate sales at the end of 2021.
They’ll continue to purchase property because they can easily rent it out and make a profit. That goes back to low inventory levels before the pandemic.
Low supply and high demand drive up housing prices. Buying a home is now unaffordable for many, so they continue to rent. That means more renters and a tighter rental market.
Another area of opportunity for investors in the real estate market is vacation rentals. Travel and tourism are back, as are in-person conferences.
If you’re looking at buying an investment for a vacation rental, buy it in a market that has high levels of tourism. You also want to buy in a market that’s still affordable.
Central Florida still provides those opportunities. Consider hiring a property management company to manage the rental. Go right here to find out more.
The Growth of Artificial Intelligence in Real Estate
One of the growing trends in real estate is the use of technology. Agents have access to so much technology, they can operate their businesses from their phones.
Another aspect of technology is the rise of artificial intelligence. iBuyer companies use algorithms to determine home values and make offers to purchase a property.
These companies then rent or resell the property for profit. It doesn’t always work. Zillow closed its iBuyer division at a loss of nearly a billion dollars.
Other companies have found success. Look for them to continue to make noise in the real estate market.
Local Real Estate Market News
You’ll notice that a lot of the real estate market news is based on averages or nationwide trends. That doesn’t always tell the full story if you want real estate news for a local area.
You’ll notice that trends in Dallas real estate market news differ from Arizona real estate market news and Florida real estate market news.
Take what you see from the national trends as guidelines. For instance, you’ll see that the national real estate news reports that inventory is up.
However, Florida real estate market news reports say that inventory is still low in South Florida. It’s possible that inventory will increase over the next couple of months, but that remains to be seen.
What’s the lesson for you? Don’t always assume that national real estate market news applies to every local market.
Will Home Prices Ever Return to Pre-Pandemic Levels?
The answer to this question depends on who you talk to.
CoreLogic predicts that the regional housing market has a 28% chance to decrease. Nationwide, the chances of a correction are 13%.
Zillow says that prices are going to go up another 15% over the next year.
Market prices depend on home inventory. The housing market was already behind at the beginning of the pandemic. It could take years for inventory levels to catch up with demand.
The Latest Real Estate Market News
What’s happening in the real estate market? If you look at the latest real estate market news, there’s a lot happening.
Inventory, demand and interest rates are starting to change. It remains to be seen how these things will impact the market.
All of this news makes it very hard to predict the future of the real estate market. The best thing to do is to come back to this site often for the latest market news and real estate insights.