US Housing Report – What This Means for You
Housing is a major topic of discussion nowadays and for good reason: the national economy is highly dependent on the housing sector. Most people have been affected by the housing crisis through equity, foreclosure or even having to see their compatriots suffer. That’s why more and more people are paying close attention to real estate news and national housing trends. However, for those not familiar with housing trends and statistics, the data can be confusing or even misleading.
On the other hand, buying or selling a home is one of the most exciting things that most of us will ever do in our lifetime. Although most of us decide to sell or buy a home based on our lifestyle preferences, it would be wrong to think that we don’t spend a lot of our time pondering about the housing trends. That’s why it is important to look at the monthly national housing report and try to make sense of it. The US housing report stirs a flurry of real estate news items and articles that you can read to gain perspective about the US housing sector and the overall buyer/seller prospects in the market.
The August report has shown that the real estate sector is gradually returning to its normalcy. These statistics provide agents, investors and other industry players with a clear view of how the local, regional and national housing markets continues to perform and how it is likely to perform in the near future. This sort of information can influence the investing world from top to bottom. Data analyzed for the month of August shows that the housing market is beginning to tip in favor of buyers, unlike the last few months when it has been seriously tipped in favor of sellers. However, that does not mean that sellers are at a disadvantage; instead it means buyer prospects are also increasing.
This year, we have witnessed the growth of inventory in August. And although the overall demand for housing remains strong, the data on the median days is showing that the marketing is striking some sort of balance that bodes well for potential buyers who were unable to find the right property to purchase this spring or summer.
During the first three weeks of August, 2015, inventory listings rose by 3% compared to July. The average list price rose to $233, 000, which accounts for an 8% year-over-year increase per year and almost flat over July. The median number of days on the market rose to 75, showing the tilt in favor of potential buyers.
The metric has fallen 6% year-over-year, which shows that the market is still doing much better than last year, although the 6% month over month increase implies that inventory is currently moving slower than it was in the previous months.
As an agent or investor, you can use the findings on how the US housing market works to improve your online marketing experience. It is important for you to understand how your local market situation is changing before considering the national conditions, although national figures might show how the market might shape up in certain parts of the country.
Without a doubt, you must dig a little bit into the statistics to make sense of them and know exactly what you are considering. Two good guidelines for interpreting statistics are:
And as we all know instinctively, the most important thing is how the local market is shaping up. For example, you may want to know the value of your home. Here, don’t bother checking the national figures. Don’t even consider the average figures in your city. Look at similar homes in the same location as you and compare aspects such as age, size and so on. And only check recently closed sales. Prices might vary considerably from time to time, and asking for prices may not be as helpful as you may think. The same guidelines apply to overall sales activity. Your area could be experiencing an increase in sales activity because a large organization just opened a store along the street. However, that may not affect people a few streets away.
Clearly, properties are sold and bought by forks with their own individual needs in mind, but housing trends and local real estate news can help shed light on the prevailing local conditions. It is important to contact an agent to find out more about how the local housing market is shaping up before buying or selling a home.
What to Consider Before Turning Your Home into a Rental
So you are considering converting your home into a rental property, but just making your home available for rent is not enough. Here are some important things to consider before turning your home into a rental:
1. Rental Market Price
Although the rental market prices can fluctuate, you need to know how to price your property. There are several ways to know the best market price for your home. Firstly, you may want to contact real estate agencies. With reputable real estate agents, market prices will depend on their database and experience in the industry. Secondly, you can go online and find out how much your unit could fetch from related properties listed by owners or agents. Finally, you may decide to drive around your area and gather as much information as possible. It could be a bit off target, but can help you come up with a reasonable market price.
Even if you don’t want to manage your unit on your own, it is always important to establish contact with renters. So you want to leave them your contact details just in case they need to call you. Obviously, you will want to put some rules in place to ensure your property manager is informed whenever issues arise. If you are not ready or able to commit time to meet the needs of your tenants, then renting out your property may not be a good decision for you.
While homeowners enjoy the flexibility and freedom of making any sort of repairs in their properties, such leeway is not given to tenants. You cannot postpone maintenance and repairs while you save money to attend to them. Moreover, if you need to fix minor issues, you may have to hire a handyman, but collecting rent to attend to such issues will end up reducing your profits, thereby making it harder to pay your bills. Before turning your home into a rental property, determine the potential maintenance costs and use such details to decide if renting out your home makes financial sense.
Many experienced tenants have a horror story about tenants from hell. When pondering whether or not to turn your home into a rental property, consider who your potential tenants will be and whether your neighborhood will supply the required number of tenants that you need to pay your bills without putting your finances at risk. Of course, you don’t want renters who cannot pay rent on time or those who do not respect their neighbors or other people. It is important to take the time to research your prospective pool of tenants before renting out your residence.
These days, many landlords are seeking the services of real estate agents and property managers who can help do the research as regards finding renters and maintaining their property. Find out the cost of such services to determine whether you can afford their help to ensure renting your house makes financial sense.
Turning a home into a residential or commercial rental property can be a great way to earn some extra income. However, homeowners should consider the aforementioned factors before opening their doors to renters. With proper research and sound financial management, putting your home up for rent might be the right decision for you!