January 2021 Real Estate Q & A
Will the overheated housing market of 2020 carry over into 2021? I’d like to find a new home, but am unsure if it is even worth it to look
Happy New Year Kevin! Thank you for your question.
First off, know that you are not alone! After an active 2020 featuring low inventory and rising prices, 2021 finds many buyers in the same boat. These families may be seeking to begin or continue a home search but share your concerns about timing, the market, and their likelihood of success.
To your first question on market trends, the short answer is that in the near term similar conditions are likely to persist. In at least the first quarter of 2021, inventory and rates will likely remain low leading to continued competition for homes under $750k in the west metro of the Twin Cities.
However, this is no reason to sit on the sidelines. In fact for many it will serve as a call to action to redouble efforts. Things have changed from even a year ago, but by considering seasonal and market specific guidelines, you can still persevere to find that new home. A few tips can help.
Focus on Preparation
It’s no secret that the housing market gets busiest as the spring thaw hits the twin cities. This means many home seekers wait for warmer weather to begin a search. Subsequently, these buyers get a late start and miss out on opportunities. Being ready to strike sooner can help you stand out, ‘beat the rush’ and subsequently increase your buying power.
- Obtain a mortgage preapproved to understand your price point so you can move fast
- Build an automated search to help easily identify properties that fit your criteria
- Schedule showings of new listings promptly and be prepared to act quickly while protecting your interests by writing contingencies into every offer
Reassess your Search Criteria and Adapt
If your initial search reveals few options or seems to be pricing you out of homes, consider adapting your wish list. We all have non-negotiables, by knowing yours and being flexibility with the ‘nice to haves’, you can still find potential homes:
- Lead with lifestyle. The pandemic has changed everything, adapt your list to reflect this. A home full of zooming students and parents working from home may have reordered priorities in home style and makeup
- Consider adding flexibility in location, a variable that may matter less with remote work and decreased commuting
- Be sure to factor in all aspects of a home including outdoor space, access to trails and others with an impact to lifestyle
Professional Guidance can Help
The best advice is to find an advocate who understands the market and process and is willing to work with you to increase your confidence. A strong agent is an ally who can bring insight to every property you consider.
- An overheated market can drive poor buyer behavior, an agent can offer an objective voice in the process to ensure you are managing risk and considering all angles
- The neighborhood-level knowledge of an experienced agent can uncover hidden gems or areas you may not have considered
- Preapprovals and carefully constructed offers are crucial. Agents can handle all of this, helping you stand out to sellers while offering protections for your family
With these tips you can be first in line, ready to act and confident in your decision-making.
Finally a note of encouragement, Kevin. Frustration with inventory is understandable in today’s market. This should not paralyze you with fear or lead to inactivity. New homes come onto the market every day and there are options for nearly every family at a variety of price points. The key is to be ready, recognize opportunity and take things one step at a time.
If your search includes the west metro of the Twin Cities I’d love to connect with you and discuss optimizing all aspects of your search. You don’t say if you are also selling a home, but if so, I’d be happy to offer pricing advice on your current home as well as referrals to other professionals for help with financing.
Knowledge is power and in today’s market prep is everything. I welcome the opportunity to be a resource to help you understand your options and secure a new home for your family. Good luck with your search!