It Depends On Who You Are
This has certainly been a unique and challenging year so far for many of us, particularly in Las Vegas. How 2020 has impacted our housing market depends a lot on where you are in the market. While there are as many particular situations as there are clients; for our purposes here, we’ll break them down into the following categories: Sellers, Buyers, & Homeowners .
Sellers – Possibly The Biggest Winner?
Those looking to sell their home this year have seen very little competition. The demand may not be quite what it was last year, but it is still well-outpacing available inventory supply. Many areas in Las Vegas are seeing 2-3 weeks as a median time on market. Historically, this is incredibly low. This demand is raising home values & in some cases for well-marketed homes, in show-ready condition, even creating bidding wars.
Yes, selling this year has its own set of hurdles to overcome, but in a cost-benefit analysis is still heavily benefiting sellers. There are particular challenges to selling a home today if the seller may be working from that home. This creates limited hours available for buyer showings. In homes with children, we could see school from home, or daycare from home further restricting showing availability. There are some excellent options available for initial showings including a 3-dimensional virtual walk-through such as this one from one of our office’s listings under contract already. Innovative solutions like this reduce intrusions for the seller & expand the buyer’s ability to get a feel for the home prior to in-person showings while keeping everyone safe.
There are also other things we can do to keep your home’s residents & potential shoppers safe as well. Requiring masks & providing booties at the entry point are some we’ve used. Keeping the home not only show-ready clean, but pandemic-clean with sanitizer at entry & disinfecting wipes for light switches, door handles & other surfaces after showings can also go a long way to keeping everyone safe & pleased throughout the process.
The Other Side Of This Coin, Of Course – Home Buyers
Buyers are seeing a lot of competition for the home of their dreams, & yes prices are rising. You may think if the sellers are coming out so far ahead, it must be at the loss of the buyer. However, for those mortgaging their purchase, the drop in interest rates is creating a win-win for both parties. In many cases the lower rates mean buyers making the same money this year as last, on average, can afford about $30,000.00 more home. Currently the median prices for resale homes in our entire MLS are only up $15,000.00 from last year. Currently buyers are still better off by a potential average of $15,000.00 with rates & prices where they are today. -See interactive graph below:
Homeowners – Those living in their home & not planning to buy, sell, or move
This group has probably had to make some adjustments to how their home is laid out & how they live (& for many now work from home). I know for us here at the Christmas household, we now have two of our four bedrooms converted to home offices. It was a bit of a change, but we are thankful to have had the space we needed to do so. For those in similar situations, there are benefits to being at home.
First & foremost, if everyone currently on your home’s mortgage is still working, historically low interest rates make this market a great time to refinance. Yes, there is a .5% or 50 basis-point “Guarantee Fee” now starting 12/1/2020 instead of 9/1/2020, to some refinances that are government backed by Fannie Mae & Freddie Mac. If you’re working with a mortgage company that can still move incredibly quickly on a refinance, you still may have a window to get that done before the fee is added to your costs. Many lenders can’t move that quickly right now & are already adding that fee into their pricing. Even with that extra fee, you’re still getting one of the lowest rates ever, historically speaking.
Another factor that comes into play when looking at refinancing to lower your monthly payment is the value of your home. You’ll see this market benefit both the homeowners and the sellers group by its limited inventory raising the value of homes due to limited supply. If your neighbor is one of the only 38 in zip code 89179 for sale in August & they just closed their sale, there is a good chance that model match just upped your valuation when your refinance appraisal goes through. Good for you! Personally, we did our refinance to benefit from low rates and raising values at the end of last year. A bit earlier that we could have, but given the volatility of all kinds of financial markets throughout this year, I’m still very pleased to have knocked off a significant amount from our monthly housing obligation.
Keep in mind, I am not a mortgage broker, lawyer, or tax-professional. I’m your REALTOR & I look forward to helping you make the most of this year, as it certainly can provide some opportunities for those looking to make a change. Feel free to contact me to discuss your situation & what I or another professional I could recommend may be able to do for you.