Reports from builders and real estate agents have suggested that buyer demand should see a sizeable increase for this year. According to Redfin, home tour demand reached an all time high last week, up 62% from 2014. Redfin real estate agents also reported that accepted contracts rose 58% compared to last year.
Low mortgage rates and low down payments may be what is getting home buyers to start their home search. Many millenials who had not been as financially “ready” to buy a home or were waiting to be able to afford the type of home they wanted, have seen their loan eligibility increase significantly. In addition, as wages have grown and the labor market has strengthened, many of these buyers have seen themselves rise to higher levels of wealth. Some buyers have moved into home buying due to the lack of rentals or high priced rentals in their area.
Redfin reported 57% of home tours taken were by first time home buyers in the week of January 12. That ratio was much higher in comparison to the 48% share these buyers held in the same week last year.
Builders have also found increased traffic, helping them cautiously increase the home inventory in the states. Having additional houses will help keep prices down, hopefully continuing to attract more home buyers on the fence.
Hart Real Estate Solutions