There is no way to have survived the housing crash of 2008 and not be a little skittish about the real estate market right now. We are seeing some of the lowest numbers of inventory in year and some of the highest numbers in appreciation as buyers compete for homes. That coupled with the fact this has been our story for quite some time now – can seem scary (even if you are able to cash in on the appreciation currently.
Boots on the ground, the energy is unnerving as buyers face a scarce number of homes to look at often times not being able to even get a showing. However, times like these, I look at the facts…
- Interest rates continue to reach record breaking low levels.
- This is a case of extreme supply and demand. We have a lot of buyers and only about a month worth of inventory. A balanced real estate market would require at lease 6 months of inventory.
With the low level of inventory, I, personally, think we have another several years of this. If you are a homeowner, you will continue to see some incredible appreciation. Buyers, you will continue to compete for homes. Considering this may be our new normal for a bit, this is what I have chosen to do:
Rentals. We currently have two rentals that we plan to hold on to and do conscious upgrades that will ultimately increase rental prices and the value of the home.
Primary Residence.This summer we bought a home that needed substantial renovations and took that project on and added equity through upgrades.
Selling our Old Primary Residence. We had always considered turning this home into a rental, however, it had a quirky layout. it was a 2 bedroom 1 bathroom built in 1917. It oozed charm but the layout was hard and because of this we chose to sell. A small, quirky home is easier to sell in an extreme sellers market.
Going forward.I am not done and am always open to buying more houses. I am always looking for a rental in a good school district in the suburbs. Only recently have I considered WHERE some people will decide to go as metro Denver continues to get more expensive and crowded.
Taking into consideration of what is going on right now in the real estate market and looking forward, I would advise unloading homes that may be harder to sell if the market were to change. Don’t be afraid to buy a home, however, be prepared for a fight. Consider creating your ideal home by adding upgrades to help increase equity. Buckle up and get ready to make money when you choose to sell a home.
Liz is broker and owner of Liz Daigle Realty.
