When making more money doesn't make housing more affordable, you know you're in a hot market.
Scorching demand is thawing out the winter real estate season. When more homeowners become interested in selling, agents will be swimming in business. After all, with home prices on the rise, the profits may be hard for some homeowners to resist.
Now if only the Fed could resist the urge to increase interest rates.
Market Update: February 7, 2018
Wages are up . . . along with interest rates and competition. If you thought affordability was about to improve, we have some news for you about inventory levels.
Wages are up, but will affordability follow?
Unemployment has been on the decline for years now (which has helped shore up real estate markets), but wages have been about as flat as the plains in the Panhandle.
Suppressed wages have been a major hurdle in the hunt for affordable housing, but that could be changing. NAR Chief Economist Lawrence Yun recently gave his take on the matter in NAR's January 2018 jobs report . Turns out, job creation inched upward ever so slightly, but the standout stat was the 2.9% increase in wages year-over-year. That’s the biggest wage increase since the recession .
Why the sudden increase? Because we’re at about full capacity employment. That means to attract and keep employees, employers now have to entice them with higher pay. Legislation in 18 states has also increased the minimum wage , boosting the average hourly wage.
But don’t celebrate just yet. Increasing interest rates will likely negate the higher pay in terms of housing affordability.
In these cities, home ownership is already on the rise.
Some cities, including Dallas, started seeing a surge in homeownership before the wage increase. It’s no surprise many of the cities with the biggest increase in homeownership offer buyers the best affordability.
A commonality among cities with surging homeownership rates is home prices that are below the national median. And that’s why suburban areas on the outskirts of large cities are just about the hottest spots you’ll find.
Affordable homes + easy commute = hot market.
Hot real estate competition is also a topic of interest on Capitol Hill. Two congressmen recently urged the Federal Trade Commission to look into the matter of listing data availability due to concerns over real estate competition . It seems some policymakers think data needs to be shared more freely.
Even mid-sized cities like Midland, Texas are feeling the heat of fired up buyers
The housing boom isn’t just happening in major metros like San Francisco and San Jose. Mid-size cities like Midland are also among the hottest real estate markets in the country . Midland charged its way up the hottest markets list last month, climbing 13 spots to 5th place.
Houston is another Lone Star city seeing lots of activity. The opening of a new community with hundreds of single-family homes this past weekend proves hurricanes can’t keep the city down long.
Meanwhile, Redfin reminds us that inventory is still an issue.
The real estate listing site recently released data on home buying in December, and the numbers suggest demand was flat thanks to low inventory levels.
The lack of inventory and high demand is also helping prompt rapid appreciation. Attom Data Solutions found that in 2017, homes appreciated by an average of $54,000 . The industry hasn't seen numbers like that since 2007. The hope is all that extra equity will encourage more owners to sell this year while the profitability is sky high.
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Laughing All the Way to the Closing Table
Our weekly humor section is where we take a moment to laugh a little. You know, in order to save our sanity.
Taking online real estate courses means you won’t have to deal with these people.
When you take traditional classes you have to deal with different types of real estate students . The networker may prove to be a valuable acquaintance (whether you like it or not), but everybody else is pretty much just a distraction.
If Bud Light was looking for the ultimate fan on Super Bowl weekend we found them.
Beer and football just go together. The guy living in this can-covered rental must loooove football. Since getting evicted, there’s a good chance he watched the Super Bowl from a local Bud Light production facility.
Did you receive a world’s dumbest agent award?
Remarkably terrible listing photo of the week goes to . . .
Even Texas Chainsaw Massacre decor might not dissuade buyers in hot markets. If you have an extensive weapon collection, this just might be your dream home.
Aceable Agent of the Week
Agent: Nicole Lopez Brokerage: Intero Real Estate Services Market Area: Greater Houston Metro Real Estate Street Cred: She's the "original taco realtor." Pearl of wisdom for new agents: Find an accountability partner to push you to achieve your goals.
Nicole Lopez knows the power of creative real estate marketing. Few agents can claim that their signage went viral and caused an Internet sensation, which ultimately led to a quick sale and a whole lot of leads.
What’s Nicole going to do to follow up her the now-famous $250 taco incentive ? She’s going to keep helping her team grow as they win over more of the Houston market.
How long have you been in the industry and how did you first get started in real estate?
Nicole: I have been in the real estate industry for eight years. I started my career in new construction sales and became licensed nearly five years ago.
What's the most interesting or most important thing you've learned in a real estate continuing education course?
Nicole: Everything I learn in continuing education is vastly important. If you aren't learning, you're stale in your craft. Knowledge is the most inexpensive resource we can obtain in our career.
What do you consider your greatest accomplishment during your time in real estate?
Nicole: My greatest accomplishment has been watching the growth of my team. It has been awe inspiring (and inspires me personally) to see these incredible women flourish. The culture and level of accountability we have created has been second to none.
Want to learn more about Nicole? See her full responses to our interview questions on the AceableAgent blog.
You can also find our Agent of the Week at:
Facebook: Nicole V. Lopez
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