The divide between the prices of homes Americans want to buy and the inventory of such homes is growing, suggesting first-time home buyers and high-end sellers might have a difficult year ahead of them. The result is likely to be swiftly rising prices at the low end and challenges for first-time buyers, and sluggish price increases and lingering listings at the top end.
With prices soaring all over the nation, experts across the map are advising prospective homeowners to jump start the search and hit the home hunting ground running toward spring. The National Association of Realtors reports that currently four of the five priciest metropolitan housing markets are within California’s borders. That being said, even with inventory and affordability levels still crouching low sludging through the new year, soon-to-be buyers want in on our cache. In relation to this, a recent report from The Wall Street Journal points to “a critical imbalance in the market: There is a significant and growing shortage of lower-priced homes and a glut of high-end ones.” But, experts agree that the anticipated economic invigoration will entice first-time buyers back into the housing arena going into the spring selling season.
Even further, NAR Chief Economist Lawrence Yun adds, “Buyer interest stayed elevated in most areas thanks to mortgage rates under 4% for most of the year and the creation of 1.7 million new jobs.” Especially here at home then, bolstering this motivation moving toward the warming seasons is key. Given that California homes are the hottest of commodities, budding spring buyers are encouraged to hop on it. Competition will likely increase even more in the coming seasons and, according to NAR President and California’s own William E. Brown, “The prospect of higher mortgage rates and more home shoppers in coming months should be enough incentive for those serious about buying to start their search now.”
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