Keeping a Pulse on the Housing Market: How to Make Smart Moves
- Author: Michael Bordonada
- Posted: 2024-03-01
With the Baby Boomer generation (those born between 1945 and 1965) retiring, the housing market is less certain than its been in recent history. That's because most of the members of this generation are likely going to downsize or look for more Senior-friendly accommodations. However, this posits a major issue: Baby Boomers own about half of all housing in the country! With so many houses that will go on sale at roughly the same time, it's likely there will be a temporary dip in prices at some point.
This is just one example of how keeping a pulse on the housing market can help you make smart moves. We'll go over trending ways to keep track of the housing market that don't take up all your time.
1. An Easy Hack to Gauge Health of the Market
Most people simply trust their real estate agent's word on the housing market. The truth is that your agent has access to the exact same numbers you do. What you're getting from them is their own spin on the market, which is much more likely to gain something for them than it is for you. Even if your agent happens to be a trusted family friend, it's critical to do your own research.
One simple way to do this is to look at how many people are moving each year. Of course, you'll need to compare it to surrounding years and their average home prices. There's one consistency you'll notice immediately: the less people moving, the lower housing prices dip. While this is simply a measure of "supply and demand", it's often overlooked by home hunters.
2. Don't Buy into iBuyers
You may be wondering what an "iBuyer" is. It's a term used in real estate to describe services that offer people cash in exchange for their houses or properties. These are commonly used in large metropolitan areas. The tech companies behind these services create algorithms that attempt to predict which areas of cities will take off and target homeowners with seemingly lucrative "instant cash" offers for their homes. They typically have the goal of under-paying homeowners and try to convince homeowners that they ultimately win out because they don't even need to list their house.
Some agents monitor the housing market by paying attention to where iBuyers are purchasing homes. However, recent housing trends in Arizona have suggested that iBuyers' algorithms aren't as foolproof as they were thought to be. Follow our first tip to stay on top of the health of the market!
3. The Census Bureau: A Neutral Source
Of course, the Census Bureau offers rather "raw" data. If you don't know how to interpret it, you're at risk of making a poor decision. However, plenty of blogs and sites provide good guidance on interpreting census data.
If you need to research demographics of an area you're considering moving to, remember that the 2020 Census is currently underway. That means that within a year, we'll know where the fastest-growing areas actually are. This is one of the very few completely neutral housing market data sources.
If you notice a trend of skilled people moving to a certain area, you can bet that prices are about to shoot up! Real estate agents also are eagerly waiting for the Census information so they can charge more for certain housing and less for other housing. If you wait for the information to be released, you may or may not benefit. However, you'll most importantly know the truth about the market and be able to more accurately predict future housing trends!
Is Keeping a Pulse Worth It?
Keeping a pulse on the housing market can be a pain sometimes. It requires a bit of dedication, but it's certainly worth it! It ensures that you don't get scammed by an unscrupulous real estate agent or housing market that offers false promises. If you're thinking about buying or selling housing in the next year, the time you invest in this process will pay dividends years to come!
