How the US’s supply chain will hinder the housing market:
- For nearly 3 years, builders have struggled to keep up with demand as availability and surging costs for building materials have ultimately produced higher prices for newly-built homes.
- And experts say conditions are not getting any better, in fact, they are worse than last year.
- Let’s talk about some of these increases:
- Building materials increased 20.3% year over year and have risen 28.7% since January 2020.
- Structural lumber has increased more than 40% over the past 13 months and according to NAHB this increase in lumber, resulted increase of about $20K per home, $40k in some markets; for an average size home.
- And let’s not talk appliances.
- Here is what Lawrence Yun, NAR’s Chief Economist states,
- “The costs and delays are rising because of the broader inflation and supply chain disruptions,”
- And yet…..“Still, there are profits to be made. Even adding on extra costs to the final price, there are consumers willing to buy.”
Let’s talk about RISING Rents!
- Rent prices break record high gains in January!! 12.6%
- Single family renters are feeling the brunt of inflation and rising home prices.
- Due to shortage rental and purchase inventory, rents continue to rise.
- Year over year the rental cost increase 12.6%
- Now, lets consider the raising interest rates.
- Take increased rates; increased prices and increased rents…..
- The increased prices alone, priced out by 19% of “potential buyers.”
Interest Rates have hit the 4% benchmark:
- It’s official, as of yesterday; rates topped 4% .
- Kicking an additional million buyers out of the buying arena.
- EVERY time rates go up per .25%, more buyers will drop out.
- Possibly giving more strong buyers the chance to grab up a home….maybe.
Piatt’s two cents:
- If you are renting, you need to create a STABLE monthly debt to income ratio for yourself. You can create that stability through home ownership.
- Landlords in Oregon, will be increasing your rent 3-7% each and every year.
- Talk to a professional about the cost of waiting vs. the cost of renting.
- And don’t forget to mention your favorite Title Company when you do write your offer; Ticor Title!
Now for some cool news………..Single women home buyers are out-pacing men!! Say it LOUDER for the folks in the back!
- In honor of Women’s month, how could I NOT MENTION how fierce women are!
- Did you know that Single Women have been second only to married couples in the home-buying market since the National Association of REALTORS® (NAR) started data collection on the topic in 1981? Neither did I!
- What is STRIKING about this statistic is that is wasn’t until 1974 that women had federal protections, enabling them to obtain a mortgage without a co-signer. Ya, you heard me, a MALE co-signer?!
- Prior to the passage of the Fair Housing Act’s and the Equal Credit Opportunity Act, it was commonplace for a woman to need a male relative as a co-signer. Women had no legal recourse under federal law for this or any other kind of lending discrimination. Now we do!
- And people wonder why the divorce rate spiked in the 70’s….. I don’t wonder, even a little.
- In 1981:
- 73% of homebuyers were married couples
- 11% were single women
- 10% were single men
- Single women reaching our peak of the share at 22% in 2006.
- Today:
- 60% of homebuyers were married couples
- 19% were single women
- 9% were single men
- And when you consider single women, on average make $13,000 less per year, than a single man, I become even MORE proud of our lady progress AND more aware that WE still have more to do in closing the income gap.
In closing,
- Ladies, we are not done yet, we still have MORE to accomplish.
- So start by never forgetting the women that paved the way for you, for us.
- Thank your mentor
- Then, turn around and support and empower the ladies behind you
- AND lastly, teach those ladies, do the same.
- For the true measure of progress, will be driven by the continuous investment in each other. ~ Piatt
Wishing you well,
Laura Piatt
For more on these trends and others, check out the full Profile of Home Buyers and Sellers report at www.nar.realtor/research-and-statistics/research-reports/highlights-from-the-profile-of-home-buyers-and-sellers.
