Zillow recently surveyed over 500 agents and here is what they found—
1. 35% say prospective buyers say they should wait for mortgage rates to drop before buying a home.
2. Nearly half of agents reported that prospective buyers think that home prices will fall significantly.
3. 81% of agents said sellers still expect multiple offers on their home.
4. 74% of agents said sellers price their homes above market value and that 74% of sellers believe there is no need to cut their price.
Michael Perry an agent in Salt Lake City said, “If prices or mortgage rates take a meaningful dip, all those sidelined buyers will likely come rushing back to the market, driving up competition and prices. If a buyer can purchase today, they have bargaining power, more options and more time to find the right home, instead of being rushed into a purchase they might regret.” Well said
Koby Sway an agent from Omaha Nebraska said this, “Sellers have to roll up their sleeves and make necessary repairs and home improvements before listing their home for sale. And it’s more important than ever to get the pricing right when competing against other sellers for a smaller pool of buyers.”
The Labor Shortage in Construction Continues
The Home Builders Institute released their fall Construction Labor Market Report and they reported they need 740k new employees this year and another 1.5 million over the next 2 years to start shrinking the housing supply deficit. There is currently at least 300k unfilled job openings in home construction.
In order to mitigate this labor shortage the HBI has stressed the importance of getting more teens exposed to the construction industry and I have been saying this for at least 4 years. I wish some of the money to create affordable housing went to our high schools to create classes in construction and other trades as this would help increase the number of employees in construction so that builders and developers can build more housing.
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· Last week Redfin announced that they are closing their iBuying division, RedfinNow as they laid off all these employees.
· According to NAHB’s analysis of the 2021 American Community Survey data 20.2% of young adults ages 25-34 live with their parents or parents-in-law. This is down from its peak of 22% in 2017 and 2018. But, with the surge in mortgage rates this percentage is sure to increase in 2022. Still 20 years ago this percentage was only 12%.
· NAR just released their 2022 Profile of Home Buyers and Sellers report and this year so far first-time home buyers only purchased 26% of the homes sold, down from 34% last year. This is the lowest level ever recorded by NAR.
· Denver was named a Top 5 City for Gen Z by Living Cozy based on median age of people who live here, job listings, equality, median house prices and gender pay gap and a few other factors.