Rents, Home Prices, and the Windy City: The August Real Estate News You Might Have Missed
The real estate industry is constantly in flux. New technologies are emerging every day, and trends, prices, rates, and everything in between change just as often.
Unless you’ve got a ton of free time (or it’s your job, like me!), following all these headlines can be pretty difficult. And gleaning just how each bit of real estate news impacts you, a potential buyer or seller in today’s market? Thanks to industry jargon and lingo, that’s usually even harder.
That’s where we come in. We’re rounding up the month’s biggest real estate headlines — the ones that matter to YOU — and breaking them down into short, easy-to-find-the-point snippets.
Top Real Estate News from August 2018
Home price growth finally stalled.
Home prices have been growing for a while, but this quarter? Prices marked their smallest increase in 4 years (just 1.1% higher than Q2 2017). Prices were especially slow-growing in Arkansas, Louisiana, Oklahoma, and Texas. William Doerner, the supervisory economist for the Federal Housing Finance Agency, said mortgage rates have “gently pressed the brakes on house price increases.” The moral of the story: The days of ever-climbing home prices might finally be numbered.
Rents kept on rising.
The national average rent has jumped more than 4% since the beginning of the year, and at the end of July, they had reached an all-time high of $1,409 per month. They also jumped in 88% of the nation’s biggest cities, with the steepest increase happening in Las Vegas. Sin City saw a nearly 5% hike in rents over the last year. Luxury rentals, in particular, have had huge rent jumps in 2018. The moral of the story: Rents are high no matter how you slice it.
The Windy City came out on top.
According to an analysis earlier this month, Chicago is the easiest place in the nation to save for a down payment on a house. Residents can save for a down payment on a median-priced home in just 3 years, 3 months. Compare that to Portland, Oregon, where it takes residents over 13 years to save up, and the Windy City is looking like a pretty solid choice for wanna-be homeowners. Other cities where it’s easier to save up? Recent real estate news says Dallas-Fort Worth (3 years, 5 months) and Detroit (3 years, 7 months). The moral of the story: When saving up, location matters — a lot.
Things started to turn around for the housing inventory shortage.
There wasn’t any huge influx of newly listed properties or anything, but both residential construction permits and single-family housing starts were up for the month — indicating relief may soon be on the horizon. Mark Fleming, the chief economist at First American, told home buyers to “take heart,” because “builders are starting to work on additional housing, inching closer to balancing inventory with demand. The moral of the story: More inventory is on its way — and hopefully lower home prices as a result.
Redfin started buying homes.
Until recently, Redfin was mostly known for two services: 1) its reduced-cost real estate agents and listing fees and 2) its database of MLS listings, similar to what Zillow, Trulia, and Realtor.com offer. Now, the company has gotten into the buying game, offering a program called “Redfin Now.” It’s designed for sellers looking to offload their property quickly —- without dealing with showings, staging, or bidding wars on the open market. You simply fill out some information about your home, Redfin makes an offer, and then you pick your closing and move-out date. It streamlines the sales process and makes quick, easy moves a breeze. (Keep in mind, it does cost a 6 to 9% fee, though.) The program is similar to what Opendoor and Offerpad have been doing for years. The moral of the story: Selling a home doesn’t have to be a hassle.
The kitchen is king for millennials.
Sellers and agents take heed: a study came out this month analyzing what millennials are looking for in real estate. The big takeaway? They love their kitchens. More than a third of millennials say the kitchen is the most important room of the house, with granite and quartz countertops, stainless steel appliances, and farmhouse sinks a big plus. They also like breakfast bars, islands and open floor plans. On luxury properties, they want features for entertaining: outdoor kitchens, wine fridges and double ovens. The moral of the story: Want to tap that millennial market? Make a few choice kitchen upgrades before listing.
Be sure to check back next month for another round up of real estate news. Want to learn more about your home buying or refinancing options in the meantime? Have questions about what all this news means for you? Get in touch with an Embrace loan officer today. We’re here to help.