Interpreting Market Data: Now is the Time to Build
What do the numbers say about today’s real estate landscape?
Real estate giant Redfin, in addition to its user-friendly platform for browsing listings and its vast realtor network, also engages in plenty of telling market research. In the phenomenon of today’s real estate landscape, many hopeful homebuyers now look to the data to figure out the best next steps.
While some headlines caution against joining in a buying frenzy or purchasing for the wrong reasons, others urge us not to wait on a house hunt, that interest rates will eventually go up and we’ll lose thousands of dollars in the waiting game.
So which is it? What’s the best move now, according to the data?
Put simply - neither. It’s true that the competitive nature of today’s market leaves too much risk and sacrifice on buyers. At the same time, waiting to enter the housing market simply doesn’t make good financial sense; there’s a good reason demand is so high.
Fortunately, there’s a way to get in on the wealth-building power of homeownership without playing the bidding war game: building your own home. Here’s how the numbers play out.
Outrageous Bidding
On top of rising prices, the sheer lengths buyers have to go to in order to be considered in today’s market feel unreasonable. As Redfin’s CEO Glen Kelman tweets, “For example, a Bethesda, Maryland homebuyer working with Redfin included in her written offer a pledge to name her first-born child after the seller. She lost.”
Of course, that’s an extreme example. But what’s all too common now are waived inspections, offers on homes sight unseen, and cash offers skyrocketing beyond the reach of many wishful buyers. Homes now sell for an average 1.7% above asking, a record high, according to Kelman. The chances of buying an existing home feel hopeless for buyers in rapidly-growing areas.
Low Inventory
The reason behind that impossible bidding game boils down to the old supply and demand equation: there’s simply not enough inventory to keep up with how many people are currently trying to buy homes.
In fact, Kelman points out that “there are now more realtors than listings.” Houses only stay on the market for a matter of weeks, and inventory is down 37% year over year - a record low. Most buyers end up putting in offers on 7 to 10 homes in markets like Charlotte, and the home they do finally win will likely have a few issues they wouldn’t have compromised on in any other market.
Escape to Budding Cities
Cities that didn’t see high popularity in the past are now the go-to targets for young professionals and families leaving expensive coastal cities behind. Especially with the dawn of a highly remote workforce, many workers are taking their San Francisco salaries to housing markets like North Carolina’s Research Triangle. Though the housing market there is by no means easy for buyers, the cost of living is significantly lower than cities like New York.
In these newly-budding metropolises, that supply and demand imbalance is especially pronounced; there aren’t enough existing homes for all the people who now want to live in these areas. However, there is plenty of opportunity and plenty of land. With this geographical and lifestyle shift comes the opportunity to create new communities and new standards for housing.
That’s why countless families turn to custom homebuilding. Without worrying about the frenzy of today’s market, the frustration over lack of supply, and the endless compromises, builders are free to instead build a home that’s true to their priorities and personality. They add to that too-small inventory pool while also making themselves a home - and investment - built to their standards and needs.
Ready to jump in on custom homebuilding? You’re right in time: building custom has never been easier. Get started today and grow one step closer to your own Atmos home.
