We are witnesses that the real estate market is changing, and the biggest culprits for that change are the economic factors and conditions and associated trends that heavily impact the process. In 2024, several key trends in the real estate market are emerging due to these changes. This article will examine these trends and explain how they impact home buyers and home-buying process. Plus, it will explore how professionals like property managers can help achieve goals in this competitive market.
Current Real Estate Market Trends
Rising Interest Rates
Interest rates are on a constantly growing and upward trajectory. This trend has been going on for some time now, and it happens because central banks want to combat inflation. What do interest rates mean? They mean higher mortgage rates, which directly affect the borrowing costs of homebuyers. When mortgage rates rise, the monthly payments rise as well, which unfortunately reduces the affordability of homes.
Limited Housing Supply
On the other hand, many regions don’t have enough housing supply, particularly available homes ready for buying or renting, especially in desirable locations. This is due to increased demand, supply chain disruptions, and a slowdown in new construction projects. This has consequences, too—an increase in competition among buyers and an increase in home prices.
Prices Urban to Suburban Shift
After the pandemic, the humanity saw the necessity of a slightly slower pace of life, so many people have replaced the urban with the suburban lifestyle. Plus, with the rise of remote work, people don’t have to leave the city and face the hustle and bustle of life there. Instead, they seek more space for their families and a better quality of life in the suburbs. So, the demand for housing supply has increased in the suburban areas, which has influenced the prices to rise.
Technological Advancements
Proptech is taking over real estate, and its impact cannot be neglected. Virtual tours, online mortgage applications, and digital document signing have all made the buying process much easier and more efficient. Plus, with the rise of technology, people can now hunt for houses from the comfort of their own homes and make much more informed decisions based on what they explore online.
Sustainability and Green Homes
A rising trend that very quickly captured the hearts of the younger generations, especially, is going for sustainability and environmental consciousness. New home buyers are seeking energy-efficient and sustainable homes, and features like solar panels and energy-efficient appliances in green building materials are increasingly popular, apart from the reduced environmental impact of these homes over long-term savings.
What Do Trends Mean for Home Buyers?
These trends are changing the way home buyers think about buying their new home. They are impacting the home-buying experience in various ways. Let’s see how.
Budgeting for Higher Mortgage Rates
Home buyers must face the truth that they would need to pay a lot more for the borrowing costs because of the high interest rates. This means that the budget needs to be carefully replanned and re-evaluated, and they should be realistic about what they can afford. Using a mortgage calculator is always helpful, especially when home buyers need to calculate the monthly payments at different interest rates and set a realistic price range.
Dealing with Limited Supply and High Prices
On the one hand, there are not many houses to choose from, and on the other hand, the prices are high, especially in desirable locations where the demand is increased. It is safe to say that the competition is fierce, the supply is limited, and the buyers must be prepared for bidding wars and potentially stretching the budget to afford more for the house they want.
Considering Suburban and Rural Areas
If homebuyers are open to moving away from urban centers, then suburban and rural apartments will be the answer they seek. They offer much more affordable options and more significant properties while still offering the comfort they seek.
Leveraging Technology in the Process
The rise of technology is not only facilitating the jobs of the people involved in the real estate industry. It also facilitates the way buyers are looking for a new home and streamlines the whole process. As mentioned before, virtual tours can help narrow down the choices before visiting in person, and online tools and apps for more mortgage applications and document signing can also speed up the process.
Investing in Green Homes
Green homes indeed have higher upfront costs, but in the long run, they are much more cost-efficient. Plus, as environmental awareness grows, green homes will have better resale value.
How Can Property Managers Help?
Property managers can be very helpful in the homebuying process, even though they are primarily associated with rental properties. They have extensive knowledge about how the real estate market works, and their invaluable insights can help home buyers navigate the process much more quickly.
- They have a deep understanding of the local market and can tell the home buyers what they should look for in a neighborhood, what the trends are in the desired location, and when is the best time to buy.
- They are skilled negotiators, so they can help home buyers secure the best deals in the buying process.
- They have a lot of contacts and access to resources that can be of enormous value to home buyers. They can connect them to real estate agents, mortgage brokers, home inspectors, and contractors.
- If home buyers are looking to buy real estate for the long term, property managers can guide them through the rental process, income, and property management and maintenance.
Conclusion
The real estate market in 2024 is characterized by rising interest rates, limited housing supply, technological advancements, the replacement of urban with suburban living, and a growing demand for sustainable homes. Home buyers must understand these trends in order to make informed decisions about buying their new homes.
