Areas that were growing by leaps and bounds are now seeing slowdowns in growth resulting from the increased interest rates on mortgages and home equity loans. Banks, anticipating a slowdown in the market, have been laying off staff in the mortgage department for months. Now we are seeing builders let go of staff and large swaths of land designated for big neighborhoods sit with street signs and water drainage and little other land development.
Now that the market is coming to a standstill, homeowners must rethink their plans to upgrade, instead updating their homes through DIY projects that are affordable with a loan. Painting and retiling floors are popular home projects because they offer instant gratification with little to no remodeling experience necessary.
Strategy for the Next Six Months
- If you can buy a home with cash, you belong to the unique group of home buyers left shopping for a new home; however, with fewer buyers shopping, sellers are having difficulty getting their asking prices and more are pulling their homes off the market. This is the time of year when fewer are listed, regardless. Let’s see what happens in March when more homes are normally listed.
- The Fed told us to expect an additional interest rate increase in the new year. Will it be enough to curb inflation or will we be told another is again on the horizon come spring? This is important to watch as it will dictate what happens to the housing market that normally goes into full swing in the early spring months.
- Hang tight and tidy up. If you can afford to stay in your home and wait for the market to improve, work on small projects that will make your home more inviting upon first impression. Think about your landscape, front stoop and doorway, entryway and how your rooms look when quickly walking through. Whatever stands out the most as a problem is a great place to get started.
- Pack up the personalization. When people walk through a home, they want to imagine their own belongings in the space. If your home is overloaded with photographs and a lot of stuff, it won’t be inviting. This is the time to clean up the area to appear more generic for the average home buyer.
At some point, the interest rates will come down again and people will be anxious to buy again. We’ve endured a downturn in the housing market before and have gained insights on the things that occur that signal to the public that the economy is improving again. People are still spending money and going out to eat, so we are not so far off from flourishing as we were back in 2008. Hopefully, changes in policy will bring about better circumstances, flow of goods, and consumer confidence. Until then, online videos offer a great resource for learning a new home renovation skill to increase the market value of your home.