I hope everyone is doing well. In this newsletter I thought I would take a few minutes to talk about the state of our current housing market and where I think it is headed. The market in our area has been all over the place since Labor day. It is definitely a sellers market for homes in the $100,000-$175,000 price range. These homes are selling very quickly if they are move in ready and priced well.
It is more of a balanced market with a slight edge to the sellers in the $175,000 to $275,000 range but supply is still a little light in this range for move in ready homes. Pre-2008 we had new construction homes in this price range to help keep up with the buyers, but there has been very little new construction in this price range. I am being told that it is difficult for builders to build a house and make a profit in this price range due to the continuing high prices in building supplies and a shortage of labor.
When prices get above $300,000 things get a little complicated. We actually have some new construction being built in the low $300’s now and it seems to be selling fairly well. The problem lies in the existing stock above $300,000. We seem to be in a buyers market in this range still. When a pristine house comes on the market and it is priced properly it still seems to sell, but for the house built in the early 2000’s or the 1990’s it has been kind of a tough sell. Many of these homes were built with top finishes for the time but the layout and styles from that time period are just not registering with todays buyers.
We have also had a demographic shift in the last few years, and the people in the 35-45 year old age range that should be buying these homes do not seem to be in a position to get into this price range. Hopefully the initiatives our local governments are working on will help in this regard, but we may be stuck in this rut, in this price range for a little while.
The luxury homes in the $450,000 and up range are still in a buyers market, but we have seen more homes in this range sell this year than we have in a few years and advances like 3D home tours and aerial drone videos have made these homes really shine from a marketing standpoint. If you have a home in this price range and are looking to sell you need to be patient.
Overall I think things are heading in a positive direction and hopefully 2017 will be the year of the $300,000 house in our area. You can get a ton of house for the money in this price range. If you are thinking of moving up to a next level house, now may be the best time to make a move.
Talk to you soon,
Mike Kelly, President
Hickory Real Estate Group