Eugene Oregon Real Estate Blog

Good Monday Morning!

The inventory of homes for sale in the Eugene and Springfield area is now hovering at right around 2 weeks of active inventory.  This means that if there were no new homes to come on the market, the current inventory of homes for sale would be exhausted within a two week time period. Nationally, the inventory of homes for sale is also extremely low, but in most cases not to the extent that we have here in Lane County.  The result of this low inventory of homes for sale is that the overall number of homes being sold is also quite low.  Mortage interest rates as of Friday had ticked up to around 4%, a marked increase from where we were just 30 days ago.  It is evident that the market change that I have predicted is hitting us.  Higher interest rates could create less demand and begin the cycle of home inventories beginning to build again. The advice that I would give anyone who is going to sell their home this year is to not wait until Spring.  The market is changing and waiting to sell your home could prove costly.  Here is an article from Realtor.com" that talks about the recent national home inventory situation.

The numbers: Existing-home sales decreased 4.6% between November and December, hitting a seasonally-adjusted, annual rate of 6.18 million, the National Association of Realtors said Thursday. Compared to a year ago, sales were down more than 7%.

Economists polled by MarketWatch had projected existing-home sales to come in at 6.48 million.

Overall in 2021, though, existing-home sales reached the highest level since 2006, a sign of the strong demand among buyers nationwide in light of the short supply of properties on the market.

“December saw sales retreat, but the pull back was more a sign of supply constraints than an indication of a weakened demand for housing,” said Lawrence Yun, the National Association of Realtors’ chief economist, in the report.

Key details: The inventory of homes for sale fell to the lowest level on record, based on data from the National Association of Realtors. The total inventory of homes for sale dropped 18% between November and December.

Expressed in terms of the months-supply, there was a 1.8-month supply of home for sale in December. A 6-month supply of homes is generally viewed as indicative of a balanced market.

The median price for an existing home was $358,000, up 15.8% from December 2020. Homes remained on the market for 19 days on average, and 79% of the homes sold in December had been on the market for less than a month.

Regionally, every part of the country witnessed a decline in home sales in December, led by a 6.8% downturn in the West.

The big picture: The recent surge in mortgage rates threatens to knock some of the wind out of the housing market’s sails. As of Thursday, the average rate for a 30-year fixed-rate mortgage was 3.56%, according to Freddie Mac. That represents the highest level for mortgage rates since March 2020, when the pandemic became a major concern in the U.S.

With a backdrop of still-rising home prices, some buyers will face greater affordability challenges in the high-rate environment. Still, the other factors that have fueled the rise in home sales over the past two years remain, including the shift to remote work and the resounding emergence of millennial buyers. In the near term, the prospect of rising interest rates could cause some buyers to rush to lock in deals.

Looking ahead: “Low mortgage rates and a pandemic-related desire for ‘more house’ continued to fuel demand, despite surging prices,” Priscilla Thiagamoorthy, an economist with BMO Capital Markets, said in a research note.

Have An Awesome Week!

Stay Healthy! Stay Safe! Remain Positive! Trust in God!

THIS WEEKS HOT HOME LISTING!

2700 5th Street, Springfield, OR 

Price: $459,900    Beds: 3    Baths: 2.0    Sq Ft: 1391

Fantastic single level Hayden Bridge ranch style home w/ backyard access to Royal Delle Park. Tastefully remodeled two years ago w/ new hardwood floors & tile, quartz counters, soft close cabinetry, stainless steel appliances & a spacious master bat...View this property >> 

AND HERE'S YOUR MONDAY MORNING COFFEE!!

Good Monday Morning!

As I have been warning everyone for weeks, mortgage interest rates took a jump last week.  Continued high inflation numbers and other negative economic news are the primary cause of this rise.  The current rise in rates is modest and won't effect the market strongly at this time, but look for the Fed to begin a series of rate increases in the near future that could begin to have a negative effect on the national housing market.  If you are thinking of selling your home soon, the time is now to put your home on the market if you want to have a chance to sell in this current hot sellers market.  Waiting could be very costly.  Contact me for market information and for a detailed look at your homes current market value.  Here is an article from "Realtor.com" that will give you further details on the current mortgage rate scenario.

Interest rates are surging on the heels of data showing a concerning outlook for inflation—and home buyers are to set to pay the price.

The 30-year fixed-rate mortgage averaged 3.45% for the week ending Jan. 13, up nearly a quarter of a percent from the previous week, Freddie Mac reported Thursday. It’s the highest average rate for the 30-year loan since March 2020 when the coronavirus pandemic first began to send shockwaves through financial markets amid the first wave of lockdowns.

Comparatively, a year ago, the 30-year fixed-rate mortgage averaged 2.23%, near record-low levels.

The 15-year fixed-rate mortgage, meanwhile, rose 19 basis points over the past week to an average of 2.3%. The 5-year Treasury-indexed adjustable-rate mortgage averaged 2.57%, up 16 basis points from the previous week.

Mortgage rates skyrocketed in response to the latest data on inflation. The Consumer Price Index released Wednesday showed that inflation was at a nearly 40-year high, with prices for goods and services having risen 7% over the past year.

Such a high rate of inflation is a major concern to the Federal Reserve, which had already indicated it would increase interest rates and scale back its bond-buying activity in an attempt to right-side the economy. But the central bank’s initial plan may now be out the window.

“With inflation more persistent, the Federal Reserve has sped up its timetable for winding down quantitative easing and is likely to begin raising interest rates sooner and more aggressively than previously expected,” said Sam Bullard, managing director and senior economist for corporate and investment banking arm of Wells Fargo, in a research note.

Bullard projected that the Fed may now hike interest rates four times, rather than the initially-projected three. And rather than simply stopping its bond-buying behavior, the central bank could actually begin shrinking its balance sheet by not replacing U.S. Treasuries and mortgage-backed securities when they mature, he said.

The Fed’s rate hikes would not have a direct impact on mortgage rates, as they tend to follow the direction of the yields on long-term bonds such as the 10-year Treasury. Instead, higher rates will materialize as investors begin to make assumptions about the Fed’s plans for curbing inflation.

Higher rates aren’t likely to cause home buyers to fully pump the brakes on their plans to purchase property, economists suggested. But it will have an impact at the margins for buyers who may struggle to afford the double whammy of higher interest rates and rising home prices.

“The rise in mortgage rates so far this year has not yet affected purchase demand, but given the fast pace of home price growth, it will likely dampen demand in the near future,” Sam Khater, chief economist at Freddie Mac, said in the report.

Have An Awesome Week!

Stay Healthy! Stay Safe! Remain Positive! Trust in God!

THIS WEEKS HOT HOME LISTING!

857 Archie St, Eugene, OR 

Price: $315,000    Beds: 2    Baths: 1.0    Sq Ft: 824

This cozy updated 2 bedroom ranch style home is located on a large fully fenced lot in a quiet neighborhood. New roof, beautifully refinished hardwood floors, new interior paint, new bathroom vanity & new cadet heaters. Kitchen has freshly painted c...View this property >> 

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Good Monday Morning!

The 2021 Real Estate Market in the Eugene and Springfield area ended with a bang!  Home prices were up 19.1% over the year.  It ended with an average sales price of well over $400,000. Will this trend continue through 2022?  My bet is a big, "NO"!  We may see this same kind of market with inflating home prices and low inventory for the first quarter and possibly into mid year.  After that, look for the effects of raging inflation to have an effect as the Fed has to raise interest rates in an effort to stem inflation.  This could create a cooling of the housing market.  How much it cools and for how long, greatly depends upon the national economy.  For now, if you are thinking about selling your home, don't wait.  You can still take advantage of a hot sellers market!! Here are the home sale numbers for December of 2021.

New listings (240) decreased 8.4% from the 262 listed in December 2020, and decreased 25.2% from the 321 listed in November 2021.

Pending sales (290) decreased 1.7% from the 295 offers accepted in December 2020, and decreased 26.0% from the 392 offers accepted in November 2021.

Closed sales (414) decreased 7.0% from the 445 closings in December 2020, and increased 0.7% from the 411 closings in November 2021.

Inventory and Market Time

Inventory decreased to 0.6 months in December. Total market time held steady at 30 days.

Year-To-Date Summary

Comparing the twelve months of 2021 to the same period in 2020, new listings (5,850) increased 4.5%, pending sales (5,180) increased 4.0%, and closed sales (5,124) increased 5.8%.

Average and Median Sale Prices

Comparing 2021 to 2020 through December, the average sale price has increased 19.1% from $365,500 to $435,300. In the same comparison, the median sale price has increased 18.6% from $336,500 to $399,000.

Have An Awesome Week!

Stay Healthy! Stay Safe! Remain Positive! Trust in God!

THIS WEEKS HOT HOME LISTING!

857 Archie St, Eugene, OR 

Price: $315,000    Beds: 2    Baths: 1.0    Sq Ft: 824

This cozy updated 2 bedroom ranch style home is located on a large fully fenced lot in a quiet neighborhood. New roof, beautifully refinished hardwood floors, new interior paint, new bathroom vanity & new cadet heaters. Kitchen has freshly painted c...View this property >> 

AND HERE'S YOUR MONDAY MORNING COFFEE!!

Good Monday Morning!

2021 was a year of home price increases across the nation.  Some areas saw massive increases, while others saw only moderate increases.  The areas with the largest home price increases were typically those states that saw large numbers of people moving to them such as Florida and Arizona.  2022 may see home price increases inch down some, but watch the same areas of heavy growth in 2022.  The rate of home price increases could remain fairly strong in those areas.  Here is an article from "Realtor.com", that goes over the home price increase situation.

The numbers: Home-price growth continues to decelerate

For the third consecutive month, home-price appreciation occurred at a slower pace, according to a major price barometer released Tuesday, reinforcing the notion that the housing market is cooling after over a year of frenzied sales.

The S&P CoreLogic Case-Shiller 20-city price index posted a 18.4% year-over-year gain in October, down from 19.1% the previous month. On a monthly basis, the index increased 0.8% between September and October.

What happened

The separate national index from the Case-Shiller report showed a 19.1% annual gain, down from a 19.7% increase in September. While lower on the monthly basis, this still represented the fourth-largest annual increase in home prices over the 34-year history of the data.

Phoenix once again led the country in terms of home-price growth, with a 32.3% increase, reinforcing research that showed it to be the housing market where housing affordability suffered the most over the past year. It was followed by two Florida cities, Tampa and Miami. Only six of the 20 major cities that the report tracks notched larger price increases in October than in September, though prices did continue to increase in all 20 cities.

“U.S. home prices moved substantially higher, but at a decelerating rate,” Craig J. Lazzara, managing director at S&P DJI, said in the report. “October’s gains were below September’s, and September’s gains were below August’s.”

The big picture: Prices won’t start falling anytime soon

A separate home-price index from the Federal Housing Finance Agency recorded a 17.4% increase between October 2020 and October 2021 nationally. That report indicated that the Mountain region—Idaho, Montana, Wyoming, Nevada, Utah, Colorado, Arizona and New Mexico—saw the largest price gains.

“House price levels continue to rise, but the rapid pace is curtailing through October,” Will Doerner, supervisory economist in FHFA’s Division of Research and Statistics, said in the report. “The large market appreciations seen this spring peaked in July, and have been cooling this fall with annual trends slowing over the last four consecutive months.”

Still, slowing price-growth isn’t the same as falling prices. Home buyers can expect to pay more and more to buy a home throughout 2022. It’s a reflection of the tight inventory of properties for sale: With so few homes to go around, competition for what properties are on the market will ensure that prices will increase given the high demand for housing.

What they are saying

“Unfortunately, the rate of home-price growth will be limiting for many young buyers who have yet to accumulate sufficient equity gains, and an expected increase in mortgage rates next year will present further challenges. Together, these two factors will keep a lid on continued home-price acceleration,” said CoreLogic deputy chief economist Selma Hepp.

“As housing costs eat up a larger share of home purchaser’s paychecks, buyers will get creative. Many will take advantage of ongoing workplace flexibility to move to the suburbs where, despite home price gains, many can still find a lower price per square foot than nearby cities,” said Danielle Hale, chief economist at Realtor.com.

Have An Awesome Week!

Stay Healthy! Stay Safe! Remain Positive! Trust in God!

THIS WEEKS HOT HOME LISTING!

857 Archie St, Eugene, OR 

Price: $315,000    Beds: 2    Baths: 1.0    Sq Ft: 824

This cozy updated 2 bedroom ranch style home is located on a large fully fenced lot in a quiet neighborhood. New roof, beautifully refinished hardwood floors, new interior paint, new bathroom vanity & new cadet heaters. Kitchen has freshly painted c...View this property >> 

AND HERE'S YOUR MONDAY MORNING COFFEE!!

Good Monday Morning!

It appears that we will end 2021 with a strong housing market. This is good news as for the first quarter of 2022. We should have a strong market initially and that is good news with inflation fears remaining high.  If you are considering a home sale soon, I would not procrastonate.

The numbers: U.S. new home sales jumped 12.4% to a seasonally-adjusted annual rate of 744,000 in November from a revised 662,000 in the prior month, the government reported Thursday. The revised October sales was the lowest since the worst period of the pandemic in April 2020.

Despite the jump, the pace of sales was below expectations because of the sharp downward revision. Analysts polled by The Wall Street Journal had forecast new-home sales to occur at a seasonally-adjusted annual rate of 766,000 in November.

The data are often revised sharply. Sales in October were initially reported at 745,000

Key details: The median sales price of new houses sold in October was $416,900 marking a new record high. The supply of new homes for sale fell by 8.5% between October and November, equating to a 6.5-month supply.

Regionally, sales rose in all regions in November except the Midwest. Sales were strongest in the West.

Big picture: The housing sector remains robust but off the highs seen last year. Sales are 14% below last year’s level.

Although the sector is expected to continue to be strong, the prospect of higher mortgage rates should keep activity from getting red-hot, economists said.

What are they saying: “This is a seriously odd report. We would not be at all surprised to see both the October and November numbers being revised up substantially. In the meantime, the rising trend in mortgage applications probably is a better guide to the underlying state of demand in the housing market,” said Ian Shepherdson, chief economist at Pantheon Macroeconomics.

Have An Awesome Week!

Stay Healthy! Stay Safe! Remain Positive! Trust in God!

THIS WEEKS HOT HOME LISTING!

857 Archie St, Eugene, OR 

Price: $315,000    Beds: 2    Baths: 1.0    Sq Ft: 824

This cozy updated 2 bedroom ranch style home is located on a large fully fenced lot in a quiet neighborhood. New roof, beautifully refinished hardwood floors, new interior paint, new bathroom vanity & new cadet heaters. Kitchen has freshly painted c...View this property >> 

AND HERE'S YOUR MONDAY MORNING COFFEE!!

Good Monday Morning!

The numbers are in and November home sales in the Eugene and Springfield area remain strong.  Home prices continue to climb as demand for residential property is high.  Mortgage interest rates remain extremely attractive, hovering around the 3% range for 30 year conventional loans.  Here are the November home sale numbers for Lane County.

Residential Highlights

New listings (321) increased 3.2% from the 311 listed in November 2020, and decreased 33.4% from the 482 listed in October 2021.

Pending sales (392) decreased 1.5% from the 398 offers accepted in November 2020, and decreased 15.0% from the 461 offers accepted in October 2021.

Closed sales (411) increased 4.8% from the 392 closings in November 2020, and decreased 9.7% from the 455 closings in October 2021.

Inventory and Market Time

Inventory decreased to 0.8 months in November. Total market time increased to 25 days.

Year-To-Date Summary

Comparing the first eleven months of 2021 to the same period in 2020, new listings (5,591) increased 5.0%, pending sales (4,899) increased 4.2%, and closed sales (4,686) increased 6.8%.

Average and Median Sale Prices

Comparing 2021 to 2020 through November, the average sale price has increased 19.3% from $363,500 to $433,600. In the same comparison, the median sale price has increased 18.2% from $335,000 to $396,000.

Have An Awesome Week!

Stay Healthy! Stay Safe! Remain Positive! Trust in God!

THIS WEEKS HOT HOME LISTING!

857 Archie St, Eugene, OR 

Price: $315,000    Beds: 2    Baths: 1.0    Sq Ft: 824

This cozy updated 2 bedroom ranch style home is located on a large fully fenced lot in a quiet neighborhood. New roof, beautifully refinished hardwood floors, new interior paint, new bathroom vanity & new cadet heaters. Kitchen has freshly painted c...View this property >> 

AND HERE'S YOUR MONDAY MORNING COFFEE!!

Good Monday Morning!

As we approach the end of another hot year for the market, homebuyers and sellers are eagerly looking ahead to the 2022 housing market. Will the market continue its streak of strong growth, or are we finally about to see a slow down? 

Here’s a high-level forecast for what to expect next year, based on the supply and demand signals we can already see in today’s data. I’ll also highlight which variables we should be watching for unexpected market shifts.

1. Demand will continue to be strong into 2022.

The first signal we look at to forecast the strength of the housing market is days on market – how fast are homes moving? Right now, we’re seeing a median of 49 days on market and climbing, as it normally does this time of year. A typical December would see market time at 85-100 days, so you can see from the chart that demand is staying elevated later in the year, which is a bullish sign for next year.

Due to the strong seasonal patterns, I predict days on market will hit a low of 21 days in April, tying the record-fast market times from earlier this year.

With homebuyer demand off the charts earlier this year, Altos Research began tracking the phenomenon we call “immediate sales.” You’ve probably seen this in your local market, where offers happen more or less immediately after the home gets listed for sale. At this moment, about 25% of properties are going into contract essentially immediately every week (around 20,000 of them within hours or days of listing) — even as supply and transaction volume declines through the end of the year. 

I actually expected immediate sales to be dropping at this point, but it isn’t. Even over the Thanksgiving holiday, total volumes were down, but immediate sales as an indicator of demand were still dominant. The fact that this trend is continuing unabated into the winter indicates continued strong demand into next year. 

That being said, if the housing market turns, immediate sales will be one of the first places we’ll be able to see it. For example, if buyers are cooled by higher interest rates, the first thing that’s going to happen is they’re not going to make those immediate offers. 

Since it will take several months for rates to rise high enough to discourage buyers, we can expect immediate sales and all the related buyer competition characteristics (multiple offers, over-bidding) to remain common well into at least the second quarter of 2022.

Another signal pointing to continued elevated demand is the percent of homes on the market taking price reductions. In a normal market, we tend to see about 30% to 35% of sellers initially over-price their homes and eventually reduce the price to attract buyers. 

Right now price reductions are at 27%, and starting to tick down again after the fall peak in September. You can see that it’s higher than last year, but still lower than normal. Home sellers with properties on the market now know that the demand is there, and they don’t have to cut their prices. This tells us that the transactions for these homes that happen in the first quarter will still be priced very strongly.

2. Low inventory will continue to be a major issue.

Unfortunately for all these eager homebuyers, inventory continues to be at record low levels. We are currently at just over 350,000 single-family homes on the market. You can see from this chart that inventory has been on a downward trajectory for years, and recent strong demand has only accelerated this trend. You can also see that it’s normal for inventory to drop at this time of year, but it’s actually declining faster than I expected even a few weeks ago, which indicates that we’ll start 2022 with record- low levels of available inventory, even less than in 2021.

At this point, it looks like we’re going to end the year at just under 300,000 single-family homes for sale. If we’re lucky, we’ll start getting greater inventory in the housing market in February, then it’ll start climbing and be at a more normal curve next year, but we’re still miles away from a normal level, with no indication that we’ll return to our usual million homes anytime soon.

That being said, keep an eye on rising interest rates. If you look at the 2018 line in the inventory chart, you’ll see that inventory hadn’t yet declined by this time of year in 2018. Why? Because interest rates rose from around 3.9% to 4.9% between April and December, and that cooled the market enough that a little bit of inventory built up during 2018. You can see that 2019 was the only recent year that started with more inventory than the year before.

3. Home prices will remain high into 2022.

With demand showing no signs of cooling and record-low inventory, I expect home prices to remain high into next year. The median home price for single family homes this week is $375,000, which is about 10% higher than last year and where we are likely to end the year.

As we look towards 2022, all the leading indicators show tight inventory and strong demand keeping prices high — a strong seller’s market. If interest rates start rising, and we’re seeing inflation or other economic challenges, this could have a cooling effect on the market. These variables aren’t in the data yet, but they’re looming. We’ll want to keep watching the data closely to spot any major shifts.

Have An Awesome Week!

Stay Healthy! Stay Safe! Remain Positive! Trust in God!

THIS WEEKS HOT HOME LISTING!

1514 NW Parker AVE, Waldport, OR 

Price: $75,000    0.14 Acres

Build your beach home on this fantastic lot located in Bayshore Beach Club in Waldport. Two blocks from the beach & club house. Amenities include club house, swimming pool, recreation room, meeting room, fitness room, tennis court and playground...View this property >> 

AND HERE'S YOUR MONDAY MORNING COFFEE!!

Good Monday Morning!

Inflation continues to rear it's ugly head and with sustained inflation comes many painful economic issues for the citizens of our country.  Long term and uncontrolled inflation is one of the worst things that can happen to an economy and it hurts everyone.  I am asked frequently, "what does this mean for the national housing market?" Here is an article that I found in "Realtor.com" that does a good job of explaining inflation issues for the national housing market.

Inflation is a red-hot topic right now, and for good reason: In October, the annual inflation rate rose to an alarming 6.2%. That’s the highest it’s hit since November 1990, over 30 years ago, and a steep uptick from the manageable 2% that we’ve enjoyed for the past five years.

Translated to your daily life, this means Americans are shelling out more money for just about everything, from gas for your tank to heating bills to groceries and more. Our money simply doesn’t go as far as it used to.

So what’s the impact of inflation on housing?

Not surprisingly, inflation is influencing the real estate market in a big way, too. According to a Stanford University study, residential real estate has historically been an “investment safe-haven” during inflationary periods. Researchers found that during the 1970s (another moment of surging inflation), home prices rose relative to the size of the economy. This was good news for homeowners and real estate investors, since it meant that their home’s rising value helped offset rising prices elsewhere.

If you were shopping for a new home, though, this was a major challenge—and the same may hold true today.

What is inflation, and what causes it?

Simply put, inflation is when the prices of goods and services rise, thereby decreasing the purchasing power of the money you have to spend. Right now, several factors are contributing to inflation. First, consider the impact of government aid during the COVID-19 pandemic.

“As the government supported American households and provided [financial assistance], that gave many people more purchasing power,” explains George Ratiu, manager of economic research at Realtor.com®. “But a lot of Americans could work remotely and didn’t need to spend on, say, takeout lunches at the office, commuting and parking, dry cleaning, and other expenses. So companies on the supply side of those goods and services needed to charge more since they had fewer customers.”

As the number of transactions dropped, business owners raised their prices to stay afloat to make ends meet. (This often happens during recessionary times.)

Another factor contributing to inflation today: the supply chain issues occurring around the globe. Manufacturing was disrupted due to the pandemic, as illness and lockdowns slowed business, and there continue to be significant problems with goods getting into ports. (The Los Angeles/Long Beach area is one oft-cited bottleneck, with so many products typically arriving there from Asia.) Trucking those items across America once they arrive has also been challenging since there are fewer people available to drive the 16-wheelers to get goods where they need to go.

“There is worker shortage. Companies are raising wages to address that, but also consequently raising prices,” says Lawrence Yun, chief economist at the National Association of Realtors®. So if a bathroom sink might normally sell for $100, when you have to pay your workers and drivers more, the manufacturer must raise prices to offset that.

How does inflation affect home prices?

Now that you understand why prices are painfully high, let’s consider how that affects home prices. Even before inflation started rising, the housing market has been tight, with prices and rents climbing. Brace yourself, because things are not heading in a more affordable direction anytime soon.

“Inflation exacerbates the housing demand-supply imbalance, which means even higher prices for housing,” explains Lawrence J. White, the Robert Kavesh Professor of Economics at New York University’s Leonard N. Stern School of Business. “People think, ‘I need a hedge against inflation, housing has traditionally been a long-lived, durable asset.’”

The more people jump into the housing market, the greater the demand, the lower the supply, and the higher the prices go. The air is already thin on this front, with home sales and median rents reaching record highs this year, says Ratiu.

White also says there’s a serious zoning construction problem throughout much of the U.S., making the market even tougher for people looking to buy and rent.

“Land use restrictions, whether the size of a lot that a single-family house can go on or for a multifamily rental or condo property, is further restricting supply,” White explains.

What does inflation mean to homebuyers and sellers?

There’s no doubt that strong inflation will affect homebuyers’ budgets. The majority of buyers tend to finance a home purchase, which means they need a down payment and then must apply for a mortgage.

“Assuming they have a down payment, the mortgage payment will be a main determinant of what they can afford,” says Ratiu. “Mortgage rates tend to move in tandem with inflation, so mortgage rates will rise. The Fed has been a principal purchaser of mortgage-backed securities, but that will wind down by April 2022, driving rates higher. By late November, Freddie Mac rates went up to 3.10%, meaning that today’s buyers of a median-priced home will spend $160 a month more on their mortgage payment, which is a noticeable impact.”

For home sellers, the current tight market can be a good time to reap a profit—provided that postsale, they can find somewhere affordable to move. If the house you bought for $200,000 is now worth $300,000, that’s terrific. But if you sell and want to stay in the area, can you afford to buy what you want, or has inflation decimated your spending power? It’s an important question to ask.

How long will inflation last?

As inflation eats away at homebuyers’ spending power, many may be wondering: When will things get better?

“My prediction would be most places will see higher prices for housing as we untangle supply chain issues,” says White. “We are also reconciling with trends in consumption going back 50 years. People had been shifting from spending on goods to spending on experiences—going to the gym, dining out, taking a cruise. COVID-19 totally reversed that. Who wants to go to a restaurant or movie during a pandemic?

“But if things shift and we do spend more on services, that will help untangle supply chain issues,” says White. “There will be less demand for goods at bottlenecked ports.”

Once that happens, inflation should abate and allow homebuyers to return to their pre-pandemic budget.

The other big question that will affect the real estate market is where mortgage interest rates go next. A lot of that depends on what steps the Federal Reserve takes.

“The 30-year mortgage rate could rise to 3.7% by the end of next year from the current 3%,” says Yun. As a result, some buyers will no longer qualify for mortgages at higher interest rates. They will have to either take their spend down a notch or sit on the sidelines for a while as the market becomes too pricey. For homebuyers who have extra cash on hand, this will be a good time to jump into the market as they look to hedge against inflation during this moment when money isn’t going as far as it used to.

While inflation will favor home sellers and investors in the near term, the hope is that after 2022, inflation will be reined in. Then, the tide would turn in favor of homebuyers, making it easier to buy a home in the new year.

Have An Awesome Week!

Stay Healthy! Stay Safe! Remain Positive! Trust in God!

THIS WEEKS HOT HOME LISTING!

2548 35th Place, Springfield, OR 

Price: $439,000    Beds: 3    Baths: 2.0    Sq Ft: 1524

Beautifully updated home in desirable Hayden Bridge area. Almost everything is brand new inside! New kitchen cabinets w/granite counters & breakfast nook, beautiful tile flooring in entry & bathrooms. New Carpet and paint inside and out. Seller spar...View this property >> 

AND HERE'S YOUR MONDAY MORNING COFFEE!!

Good Monday Morning!

It's that exciting time of year again as we get ready for Christmas and everything that it means!  For many of us, the tradition of Christmas means decorating our homes both on the inside and out. One of the little know advantages of decorating our homes is the fact that we get to look more closely at parts of our home that we typically are not in touch with.  The following article talks about how you can inspect portions of your home as you decorate and uncover some issues or potential home issues.

Holiday decorating is in full swing, and as homeowners deck their halls, they may want to also use the festivities as an excuse to inspect several out-of-sight ares of their home.

Groundworks, a basement and foundations firm, offers up tips to spot needed repairs in the home while also hanging your holiday decor. Here are the top seven home issues they suggest looking for:

Electrical outlets 

Is a plug no longer working? Outdoor outlets are exposed to the elements and can become damaged. A ground fault circuit interrupter may have been tripped. Take precautions if you find any loose connections or exposed wiring.

Circuit breakers

While installing an outdoor light display, homeowners may discover problems with the home’s electrical system or circuit breaker box. “Some homeowners may only check out their electrical panel if they accidentally throw a breaker,” GroundWorks says. “However, proactive homeowners may want to look at their breaker box before installing holiday lights. You may discover that you need a diagram of which circuits are connected to which outlets or appliances. This can help you avoid overloading a single circuit.” LED Christmas lights tend to use less electricity and may help avoid blown fuses.

Overgrown shrubs

Plants should be about two feet from your house to protect your foundation. Tend to any overgrown plants while hanging holiday lights, or make a note on your calendar to do so in March or April. “If you have overgrown evergreens, you can also give them a light trim around the holidays and use that greenery for home decorations,” Groundworks says.

The roof or gutters

If you’re on a ladder to hang Christmas lights, be sure to take a look at the roof and gutters. Are the gutters clogged? Is rainwater pooling right next to the foundation? Are any shingles missing on your roof? Spot existing damage and avoid creating more problems by using light clips on the edge of your gutter while hanging Christmas lights, GroundWorks suggests.

Chimney

Take a close look at the chimney. Does it look like it’s tilting or starting to separate from the house? This could be a sign of foundation issues. To test it, Groundworks suggests, hold a string with a small weight from the top edge of the house. The string will always fall straight down. Compare that to the structure to determine whether there is a tilt to any portion of the home, including the chimney. A tilting chimney may show a visible gap where it is pulling away from the remainder of the house, Groundworks says. A foundation expert may need to identify the problems and explore the best ways to fix them.

Pest damage

You may also spot damage from pests. “Along the eaves, you could find woodpecker holes or wasp nests,” Groundworks says. “Where the house meets the ground, you could find signs of termites or ants.”

Siding damage or wood rot

Look for any signs of deterioration, damage, or wood rot on your siding or window frames. If you find any, your home could be vulnerable to water damage. “In the warmer months, your home could be unprotected from heavy rains, resulting in flooding or moisture in your basement or crawl space,” Groundworks warns. “As the weather turns cold, the damaged siding could allow water inside the walls, cracking the concrete when it freezes.”

Have An Awesome Week!

Stay Healthy! Stay Safe! Remain Positive! Trust in God!

THIS WEEKS HOT HOME LISTING!

2947 Dry Creek Rd, Eugene, OR 

Price: $465,000    Beds: 3    Baths: 2.0    Sq Ft: 1609

Gorgeous and completely updated one level home. Granite counters, stainless appliances and very open kitchen family room. Large landscaped and fenced backyard with 400 sq foot + shop storage building. Beautiful fully covered patio, large RV parking...View this property >> 

AND HERE'S YOUR MONDAY MORNING COFFEE!!

Good Monday Morning!

If you are considering building a new home or even a remodel of your existing home, it can be challenging right now. Supply chain disruptions have created huge shortgages of building supplies such as tile, paint, hardwood flooring, lighting fixtures, plumbing fixtures, appliances and much more.  Don't expect that you won't deal with many long delays and in some cases the inablity to get the products you want.  I know of remodels that should have taken 2-3 months that are taking over a year to complete.  Also, look for prices on all of these building supplies to continue to escalate as scarcity drives prices higher.  All of this is putting pressure on an already highly inflated new home industry.  It's a much different world for new construction that we live in today and it has all happened within the last year.  Here is an article from "Realtor.com" that speaks to this issue.

New home construction ebbed in October, but permitting activity continued at a steady clip, pointing to the challenges builders are facing in starting and completing projects.

U.S. home builders started construction on homes at a seasonally-adjusted annual rate of 1.52 million in October, representing a 0.7% decrease from the previous month, the U.S. Census Bureau reported Wednesday. Compared with October 2020, housing starts were up 0.4%.

The pace of permitting for new housing units increased in October, however. Permitting for new homes occurred at a seasonally-adjusted annual rate of 1.65 million, up 4% from September and 3.4% from a year ago. Economists polled by MarketWatch had expected housing starts to occur at a median pace of 1.63 million and building permits to come in at a median pace of 1.58 million.

What happened

The overall pace of housing projects being completed remained unchanged between September and October, but the rate at which builders finished work on single-family homes declined roughly 1.7% over that period.

Every region nationally saw an increase in permitting activity, led by an 8.3% uptick in the Midwest. Permits rose for all building types as well. Single-family permits increased 2.7%, whereas permits for buildings with two to four units lifted 8.2% between September and October. Multifamily permits increased 6.5% on a monthly basis.

The drop in housing starts was caused by a 3.9% decline in new construction for single-family homes. Multifamily starts actually rose 6.8% between September and October. Regionally, every part of the country recorded a downturn in housing starts except for the Midwest.

The big picture

The mixed message from the Census Bureau’s new home construction report points to the supply chain-related challenges home builders are facing.

Building materials are still harder to come by than they were before the COVID-19 pandemic, and labor shortages continue to plague the construction sector. Both these factors have hampered home builders’ ability to scale up the pace of construction.

That said, the demand for new homes remains elevated. “September new home sales figures were strong which reflects market optimism, and indicates that once materials and labor become readily available we are likely to see a similar surge in starts,” said Kelly Mangold, a principal with RCLCO Real Estate Consulting.

What they’re saying

“In September, homes under construction hit a 47-year high. With builders’ resources so stretched, starting new constructions is being held back,” Benjamin Reitzes, macro strategist at BMO Capital Markets said in a note, citing research from his colleague, BMO senior economist Sal Guatieri.

“With demand still strong and inventories low, the backdrop for building activity should improve as supply constraints gradually ease,” Rubeela Farooqi, chief U.S. economist for High Frequency Economics, said in a research note.

“With one-in-four homeowners reporting that they aren’t selling this year because they can’t find a next home to buy in their price range, existing homeowners are facing a bit of a catch-22. For many markets, new construction is the solution,” said Danielle Hale, chief economist at Realtor.com.

Have An Awesome Week!

Stay Healthy! Stay Safe! Remain Positive! Trust in God!

THIS WEEKS HOT HOME LISTING!

2548 35th Place, Springfield, OR 

Price: $439,000    Beds: 3    Baths: 2.0    Sq Ft: 1524

Beautifully updated home in desirable Hayden Bridge area. Almost everything is brand new inside! New kitchen cabinets w/granite counters & breakfast nook, beautiful tile flooring in entry & bathrooms. New Carpet and paint inside and out. Seller spar...View this property >> 

AND HERE'S YOUR MONDAY MORNING COFFEE!!