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Eye on real estate

Selling your house a winning strategy this spring

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March 21st, 2016
Wind Crest Personal Moving Consultant Beth Brandenburg

Wind Crest Personal Moving Consultant Beth Brandenburg

Real estate publications have been reporting the top five real estate trends to expect this year since early December 2015, but now that the spring market is shifting into high gear, what do those trends mean to people selling now?

For older generations who are looking to shed the responsibilities of home maintenance by moving to Wind Crest, the Erickson Living community in Highlands Ranch, Colo., the top five trends may have different outcomes than for those who are buying a single-family home in the area. Let’s take a look.

1. Back to “normal.” According to realtor.com, the market will balance out with steady but not outrageous growth in home sales and prices. “This slowdown is not an indication of a problem—it’s just a return to normalcy,” writes real estate reporter Jonathan Smoke.

“The good news for sellers is that buyers will no longer feel that it is a runaway market,” says Rob Stark, broker associate for RE/MAX Professionals of Littleton, Colo.

Stark says that for the last three years, buyers have expected to outbid and overpay in order to purchase a home. “The fact that the market ‘took a breath’ will give buyers more confidence to enter the market,” he says.

2. Millennials moving in. Millennials—buyers between ages 25 and 34—represented one third of total sales in 2015, and that trend will increase in 2016, making this the best year to sell in the near future, says realtor.com. 

What’s more, older Baby Boomers looking to right-size are providing much of the inventory millennials desire. 

“Many millennials are first-time buyers or they are trading up from condos or starter homes. This creates the perfect role for older generations downsizing and transitioning to maintenance-free living at Wind Crest,” says Wind Crest Personal Moving Consultant Beth Brandenburg. “It’s a win-win situation for both generations. Our incoming residents are providing homes that millennials are looking for to start their own families.”

3. Rising mortgage rates will spike sales. The move by the Federal Reserve to guide mortgage rates upward may discourage some buyers by the end of 2016. However, this spring, real estate experts expect buyers to flood the market in hopes of scoring low interest rates before the hike.

“Putting your house on the market in the first two quarters has two distinct positives: one, more buyers enter the market and, two, the trend is toward upward pressure on pricing as the market becomes more competitive,” says Stark. “We will also experience low residential inventory in the Denver metro area, which is going to remain positive for sellers.”

He adds that despite the rate hike, interest rates will remain historically low.

4. Buying more favorable than renting. With rents rising higher and higher, in many parts of the country, buying is more affordable than renting. Renting households that can qualify for a mortgage are more likely to enter the market as serious buyers this year. 

Stark says the Denver rental market is one of the highest in the nation, making purchasing a home drastically more affordable than renting. 

“We will probably not see the rental fatigue end this year, which will continue to make purchasing more desirable well into 2017. This gives sellers a distinct market advantage now and in the foreseeable future,” he says.

5. Gen Xers ready to buy. Trends No. 3 and No. 4 will also cause older buyers to enter the market or trade up. 

Nationally in 2015, Gen Xers (ages 35 to 49) made up just over a quarter of recent buyers, while millennials made up 32%, according to a study of generational home-buying trends by the National Association of Realtors. 

However, Stark says that Gen Xers are the largest buyer demographic in the region, and they make excellent potential buyers for several reasons.

“The median age for buyers in the mountain region is 49. For our specific region, only 21% are first-time homebuyers, which gives the majority of our buyers previous real estate equity and more home ownership knowledge than the typical purchaser nationwide. This usually correlates into smoother transactions,” Stark says.

“The typical Wind Crest client has also lived in and maintained their home over a long period time. This is very comforting to real estate buyers,” he adds.

While the nation expects to experience a positive 2016 real estate market, Stark says, “The appealing Colorado lifestyle and improving economy makes selling your home in the year 2016 a winning strategy.”

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