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Home Price Appreciation Through 2025

Tuesday, July 6, 2021
by Liz Warren

A Look at Home Price Appreciation Through 2025

Heres what it looks like nationally. Undoubtedly, the Mt. Hood area will go over the 8.66% average for the US.  Our numbers are off the chart! This makes appraisals difficult and challenging for lenders as we are constantly seeing buyers willing to make up the difference in offer price and sales prices.

A Look at Home Price Appreciation Through 2025 | MyKCM
 

Home prices have increased significantly over the last year, which in turn has grown the net worth of homeowners. Appreciation and home equity are directly linked – as the value of a home increases, so does a homeowner’s equity. And with these recent gains, homeowners are witnessing their financial stability and well-being grow to record levels.

In more good news for homeowners, the most recent Home Price Expectations Survey – a survey of a national panel of over one hundred economists, real estate experts, and investment and market strategists – forecasts home prices will continue appreciating over the next five years, adding to the record amount of equity homeowners have already gained over the past year. Below are the expected year-over-year rates of home price appreciation from the report:A Look at Home Price Appreciation Through 2025 | MyKCM

What Does This Mean for Homeowners?

Home prices are climbing today, and the data in the survey indicates they’ll continue to increase, but at rates that approach a more normal pace. Even still, the amount of household wealth a homeowner stands to earn going forward is substantial. This truly becomes clear when we consider a scenario using a median-priced home purchased in January of 2021 and the projected rate of appreciation on that home over the next five years. As the graph below illustrates, a homeowner could increase their net worth by a significant amount – over $93,000 dollars by 2026.A Look at Home Price Appreciation Through 2025 | MyKCM

Home Price Appreciation and Home Equity

CoreLogic recently released their quarterly Homeowner Equity Insights Report, which tracks the year-over-year increases in equity. It shows an average annual gain of $33,400 per borrower over the past 12 months. In the report, Dr. Frank Nothaft, Chief Economist for CoreLogic, further explains:

"Double-digit home price growth in the past year has bolstered home equity to a record amount. The national CoreLogic Home Price Index recorded an 11.4% rise in the year through March 2021, leading to a $216,000 increase in the average amount of equity held by homeowners with a mortgage.”

The expected, sustained growth of home prices means homeowners can continue to build on the past year’s record levels of home equity – and their financial prosperity. It also presents today’s homeowners with a unique opportunity: using their growing equity for a home upgrade. With so few homes available to purchase and strong buyer demand, there may not be a better time to sell your current house and move into one that better meets your needs.

Bottom Line

Home prices are expected to continue appreciating over the next five years, and the associated equity gains are the quickest way homeowners can build household wealth. If you're a current homeowner who’s ready to take advantage of your built-up equity, let’s connect today to discuss your options.

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Happy Independence Day!

Friday, July 2, 2021
by Liz Warren

                      Happy Independence Day!

Happy Independence Day! | MyKCM
 

Wishing you a happy and safe Independence Day.

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Are We in a Housing Bubble on Mt. Hood?

Thursday, July 1, 2021
by Liz Warren

Are We in a Housing Bubble On Mt. Hood?

                      Experts Say No.

Are We in a Housing Bubble? Experts Say No. | MyKCM
 

The question of whether the real estate market is a bubble ready to pop seems to be dominating a lot of conversations – and everyone has an opinion. Yet, when it comes down to it, the opinions that carry the most weight are the ones based on experience and expertise.

Here are four expert opinions from professionals and organizations that have devoted their careers to giving great advice to the housing industry.

The Joint Center for Housing Studies in their The State of the Nation’s Housing 2021 report:

“… conditions today are quite different than in the early 2000s, particularly in terms of credit availability. The current climb in house prices instead reflects strong demand amid tight supply, helped along by record-low interest rates.”

Nathaniel Karp, Chief U.S. Economist at BBVA:

“The housing market is in line with fundamentals as interest rates are attractive and incomes are high due to fiscal stimulus, making debt servicing relatively affordable and allowing buyers to qualify for larger mortgages. Underwriting standards are still strong, so there is little risk of a bubble developing.”

Bill McBride of Calculated Risk:

“It’s not clear at all to me that things are going to slow down significantly in the near future. In 2005, I had a strong sense that the hot market would turn and that, when it turned, things would get very ugly. Today, I don’t have that sense at all, because all of the fundamentals are there. Demand will be high for a while, because Millennials need houses. Prices will keep rising for a while, because inventory is so low.”

Mark Fleming, Chief Economist at First American:

“Looking back at the bubble years, house prices exceeded house-buying power in 2006 nationally, but today house-buying power is nearly twice as high as the median sale price nationally…

Many find it hard to believe, but housing is actually undervalued in most markets and the gap between house-buying power and sale prices indicates there’s room for further house price growth in the months to come.”

Bottom Line

All four strongly believe that we’re not in a bubble and won’t see crashing home values as we did in 2008. And they’re not alone – Goldman Sachs, JP Morgan, Morgan Stanley, and Merrill Lynch share the same opinion.

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High Court Says CDC Lacks Authority For Nationwide Eviction Moratorium

Wednesday, June 30, 2021
by Liz Warren
June 30, 2021
 

High Court Says CDC Lacks Authority

In a 5-4 ruling Tuesday evening, the U.S. Supreme Court said the Centers for Disease Control and Prevention (CDC) lacked authority to implement a blanket, nationwide eviction moratorium.
 

Although the court declined to lift the ban immediately, the ruling means the current moratorium will expire at the end of July.
 

“This is a massive victory for property rights,” says NAR President Charlie Oppler.  “For more than a year, mom-and-pop property owners have been pushed toward financial ruin as they upkeep their properties and pay their taxes and mortgages with no income of their own.  With the pandemic waning and the economy improving, it is time to restore the housing sector to its healthy, former function.  Property owners also deserved this absolute clarity from our federal court system regarding property rights in America to avoid similar financial harm in the future.”
 

“This ruling keeps in place certainty for tenants for another month while bringing clarity to struggling housing providers.  It is now critical that the nearly $50 billion in rental assistance NAR helped secure gets out to those who need it most,” Oppler continues.
 

The eviction ban was first issued in September 2020 during President Trump’s term and was extended by President Biden several times through the end of July.
 

With the support of NAR, the Georgia and Alabama Associations of REALTORS® challenged the orders in federal court.
 

In May, a U.S. federal judge sided with housing providers, ruling the moratorium unconstitutional.  However, the judge issued a stay of her ruling pending appeal.
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Appraisal Gaps Grow on Mt. Hood Purchases

Tuesday, June 29, 2021
by Liz Warren

What To Expect as Appraisal Gaps Grow

What To Expect as Appraisal Gaps Grow | MyKCM
 

In today’s real estate market, low inventory and high demand are driving up home prices. As many as 54% of homes are getting offers over the listing price, based on the latest Realtors Confidence Index from the National Association of Realtors (NAR). Shawn Telford, Chief Appraiser at CoreLogic, elaborates:

“The frequency of buyers being willing to pay more than the market data supports is increasing.”

While this is great news for today’s sellers, it can be tricky to navigate if the price of your contract doesn’t match up with the appraisal for the house. It’s called an appraisal gap, and it’s happening more in today’s market than the norm.

According to recent data from CoreLogic, 19% of homes had their appraised value come in below the contract price in April of this year. That’s more than double the percentage in each of the two previous Aprils.

The chart below uses the latest insights from NAR’s Realtors Confidence Index to showcase how often an issue with an appraisal slowed or stalled the momentum of a house sale in May of this year compared to May of last year.What To Expect as Appraisal Gaps Grow | MyKCMIf an appraisal comes in below the contract price, the buyer’s lender won’t loan them more than the house’s appraised value. That means there’s going to be a gap between the amount of loan the buyer can secure and the contract price on the house.

In this situation, both the buyer and seller have a vested interest in making sure the sale moves forward with little to no delay. The seller will want to make sure the deal closes, and the buyer won’t want to risk losing the home. That’s why it’s common for sellers to ask the buyer to make up the difference themselves in today’s competitive market.

Bottom Line

Whether you’re buying or selling, let’s connect so you have an ally throughout the process to help you navigate the unexpected, including appraisal gaps.

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We're Having A Heatwave!

Saturday, June 26, 2021
by Liz Warren

 

Heatwave on Mt. Hood

                                       WE"RE HAVING A HEATWAVE

 

 

 

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Homebuyers for Mt. Hood: Hang In There

Friday, June 25, 2021
by Liz Warren

Homebuyers For Mt. Hood: Hang in There 

Homebuyers: Hang in There [INFOGRAPHIC] | MyKCM
 

Some Highlights

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Tips For Today's Mt. Hood Sellers

Thursday, June 24, 2021
by Liz Warren

      

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Mt. Hood Chalet in Rhododendron

Thursday, June 24, 2021
by Liz Warren

Here is the perfect Mt. Hood getaway located in the Timberline Rim subdivision above the Sandy River. Tons of wood throughout the home with high vaulted ceiling in the living room and tons of sun filled windows with natural light. Toe warming fireplace is ready to go after a day on the slopes. Two spacious bedrooms on the main level and a huge loft upstairs. $385000!

Chalet on Mt. Hood in Timberline Rim

Living room in Mt. Hood Chalet

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Vacation Home Demand is Strong on Mt. Hood

Thursday, June 24, 2021
by Liz Warren

Demand for Vacation Homes Is Still Strong

On Mt. Hood

Demand for Vacation Homes Is Still Strong | MyKCM
 

The pandemic created a tremendous interest in vacation homes across the country. Throughout the last year, many people purchased second homes as a safe getaway from the challenges of the health crisis. With many professionals working from home and many students taking classes remotely, it made sense to see a migration away from cities and into counties with more vacation destinations.

The 2021 Vacation Home Counties Report from the National Association of Realtors (NAR) shows that this increase in vacation home sales continues in 2021. The report examines sales in counties where “vacant seasonal, occasional, or recreational use housing account for at least 20% of the housing stock” and compares that data to the overall residential market.

Their findings show:

  • Vacation home sales rose by 16.4% to 310,600 in 2020, outpacing the 5.6% growth in total existing-home sales.
  • Vacation home sales are up 57.2% year-over-year during January-April 2021 compared to the 20% year-over-year change in total existing-home sales.
  • Home prices rose more in vacation home counties – the median existing price rose by 14.2% in vacation home counties, compared to 10.1% in non-vacation home counties.

This coincides with data released by Zelman & Associates on the increase in sales of second homes throughout the country last year.

As the data above shows, there is still high demand for second getaway homes in 2021 even as the pandemic winds down. While we may see a rise in second-home sellers as life returns to normal, ongoing low supply and high demand will continue to provide those sellers with a good return on their investment.

Bottom Line

If you’re one of the many people who purchased a vacation home during the pandemic, you’re likely wondering what this means for you. If you’re considering selling that home as life returns to normal, you have options. There are still plenty of buyers in the market. If, on the other hand, you want to keep your second home, enjoy it! Current market conditions show that it’s a good ongoing investment.

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Displaying blog entries 391-400 of 1883

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