Kansas City home sellers should know about the current real estate market because today’s housing market is much different than it has been in the past. Baby boomers are leaving their homes and downsizing, while millennials are looking for housing. Rentals are still in high demand although some younger people are opting to buy rather than rent. The number of buyers in the Kansas City market has increased and that might be good news for sellers.
Navigating the Currents
Reflecting the ripple effects of the 2008 national trend towards reduced new housing production, the backlog of finished units still awaits fulfillment. This scenario is compounded by the subsequent increase in demand due to the pandemic. The currently low-interest rates are enticing potential buyers, who might not otherwise have been able to invest in housing, to enter the market. Furthermore, shifts in federal tax guidelines are causing a migration of buyers from high-tax states, as they can no longer claim their property taxes as deductions.
The National Association of Realtors highlighted in October 2020 that there has never been a lower number of homes available for sale. If no additional homes were listed from this point, there is barely more than a two-month supply of inventory at hand. In addition, the traditional rise in the number of homes listed by sellers looking to upgrade, like moving from a starter home, has hit a roadblock. A significant number of homeowners, unable to secure a second mortgage to buy a new home, are choosing to hold onto their existing properties, ensuring they don’t risk their current housing arrangements.
These concurrent circumstances have shaped an extraordinary seller’s market, with the combination of increased demand and limited housing availability driving prices up significantly. Continue reading to understand what home sellers in Kansas City should be aware of regarding the current state of the real estate market in Kansas City .
The Trouble With Bidding Wars
While a seller’s market may sound like a perfect scenario, Kansas City home sellers should know that bidding wars affect the real estate market in Kansas City . The problem comes when buyers bid above the amount the home will appraise while remaining below the typical 80 percent of the loan to value the mortgage. There is a potential to lose your buyers, should they find themselves in a bidding war. They may not have the finances to afford the higher monthly payments and a higher principle, let alone the additional cost of mortgage insurance. And may not have enough cash on hand to cover any shortage between the appraisal and the final purchase price.
What Goes Up Must Come Down
All good things come to an end. Housing prices had already begun to trend upward before the pandemic and continue to rise. Under the current conditions, most first-time homebuyers facing the rapid jump in listing prices cannot afford the average home. Kansas City home sellers should be acutely aware that the current rising price trend on the real estate market in Kansas City cannot continue indefinitely, and the real estate market may crash. Indicators are that foreclosures, which are on hold now, will rise among lower-income households. Around 2.75 million mortgages are in forbearance under the CARES act’s protection at this time, with approximately 10 percent of all FHA-backed mortgages more than three months behind on payments.
Avoiding the Risks of Selling
Avoiding selling for too long may mean that sellers miss out on this rare opportunity to strike while the market is at or near its peak. When it comes to traditional listings, a significant number of people simply do not want to take the risks of meeting with strangers to negotiate or do business. Many would prefer not to have showings during the pandemic because of potentially ill buyers walking through their homes.
With stress already at an all-time high for many, the mere thought of the additional pressures of selling a home, especially when school and work are home-based, is too much to consider. Kansas City home sellers should know that there is another way to sell their home on the real estate market in Kansas City , by selling to a direct buyer like Mastiff Home Buyers .
Ready to learn more about what Kansas City home sellers should know about the real estate market in Kansas City ? At Mastiff Home Buyers , we are here to listen and help you handle all of your problems. With fair prices, straightforward easy to understand contracts, and quick closings. Working with Mastiff Home Buyers means there’s no need to delay selling any longer! Mastiff Home Buyers will walk you step by step through the process and help you determine what is best for you! Send us a message or call Mastiff Home Buyers at (816) 535-0076 today!