Real Estate Watch – Glenn Holtz & Tanya Gabriella
What’s Influencing Renters to Become Homebuyers?
One major factor that is influencing people who are currently renting now to become buyers is the amount renters are paying monthly. The rental market has been saturated with renters for the last couple of years. This increase in demand has driven the rental rates significantly higher than what landlords have previously asked several years ago. But this is also causing the rental supply to dwindle, which is creating a bit of a rental bidding war in some areas.
What is the reason for the increase in rental demand? Many economists feel it’s the low inventory levels for purchasing a home. According to Realtor.com Chief Economist Jonathan Smoke, “This January reading is the lowest January measure of supply since January 2005. We’ve now seen 41 straight months of tight supply.” Homebuyers don’t want to over pay for their homes. The majority of buyers are staying within their parameters and would rather wait for the right home to come on the market than to compromise and purchase a home that doesn’t quite meet their needs. With the low inventory levels this may take several months. This is why you are seeing renters staying in their rental homes longer than usual, and rental rates increasing due to the demand for a rental home.
Homebuyers are staying positive about buying. “Homebuyer sentiment remains positive, with 33 percent of those surveyed indicating that they are more inclined to buy compared to last year,” according to DSNews. The patience seems to be paying off. We have had several clients find their dream homes.
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