In an increasingly competitive and inventory-shorted housing market, more and more homes are available as fixer uppers than ever before. Part of the fixer upper movement is courtesy of the show of the same name highlighting Waco, Texas-based Chip and Joanna Gaines where virtually uninhabitable homes in need of dire upgrades are transformed into practical works of art.
The reality though, is far from what HGTV portrays and actually paints a different picture of the current United States housing market. More and more buyers want fixer upper homes than ever before, and here’s why:
Inventories are Small
If you’ve read any of our previous blogs, then you know that first time home buying millennials and empty-nest Baby Boomers are competing for the same homes. While one set is just beginning their life, the other is looking to downsize. The downside to all of this is that home inventories, especially in growing or high-demand metro areas, have not kept up with the number of buyers in the market.
Shrinking, or at least steady, home inventories mean that more sellers and realtors can put a price on a home “as is” without having to do what many may consider significant aesthetic upgrades.
Homebuyers are Inspired to Work
Another reason fixer upper homes are in such high demand is that new homebuyers are more motivated to do the work themselves. The advent of YouTube and the internet at large lends itself to the mechanically inclined to do the work themselves saving thousands of dollars while adding significant value back into a home.
This type of behavior is further fueling the sale of older houses in need of some upgrades and further constrains the already tight housing supply in the marketplace. While new homes lend themselves to creativity from conception, fixer upper homes can be a blank canvas to make something interesting and unique to each homeowner.
Sellers are Driving the Market
The power within the current housing market in most of the United States lies with the sellers. If you have a home you’re willing to sell, then you can about name your price as demand is currently extremely high. Markets experiencing rapid growth or close proximity to fast-growing metropolitan areas command high prices in short inventory markets.
With that said, buyers still have the bargaining power of negotiation and making thoughtful offers can go a long way to getting a dream home even in a location where inventory is tight and prices are slightly higher than average. A good realtor familiar with your area can help you make the right offer the right way and get closer to closing a deal for the perfect home.
Buying the Right Way
Enlisting the help of a realtor can help you navigate a crowded sellers market, but your realtor can only help so much if you don’t know how much you can actually afford. Crunch the numbers with your existing income and expenses and, with the help of a financial professional, come up with what you and your family can afford in terms of a monthly mortgage payment.
Getting that part out of the way early in the process will make sure that you don’t miss out on a house if it comes available on short notice. With so many mortgage options out there, loan professionals like the ones at Tidewater Mortgage Services, Inc. can be an extremely valuable asset. An experienced loan officer can help you navigate the crowded mortgage landscape and find the financing solution that’s right for you.
