Posted on May 20, 2021

Housing Market Is So Hot That Buyers Are Offering More Than The Asking Price

As a recent article in Forbes indicates, home prices have started to shoot up. A number of reasons exist for this spike, including record inflation of the cost of building materials, a lack of new home construction as a result of the coronavirus pandemic, and persisting low mortgage rates that have boosted demand for new housing. The combination of these factors have resulted in new home buyers being willing to pay more than the asking price.

The increase in home prices has been a boom for people who seek to sell their homes. However, it has also proven to be a problem for other people who want to buy housing, especially first-time new home purchasers. However, the inflation in new home prices is not universal across the United States. Indeed, some regions of the country have seen a slight drop in home prices or at least a slower growth.

For example, in Columbus, Ohio, where Rockford Homes is located, home prices have increased an eye-popping 16.9 percent between December 2019 and December 2020. This increase will put home buyers in a pinch, perhaps putting owning a home out of reach, at least for the time being.

However, Dallas, Texas, where Grand Homes is located, has seen a slight drop in home prices by about 1.1 percent. The decrease suggests that there are still parts of the country where housing is relatively still affordable.

The increase in housing prices in certain areas of the country and the decrease in other areas have caused potential home buyers to contemplate their situation. Do they hold off on buying a home in the hopes that the price increase is a bubble that will burst when new construction ramps up? One strategy some people, who have started to work from home because of the pandemic, has been to move to parts of the country with affordable housing, especially in the south and Midwest, and continue to work remotely at their original jobs. Or do they dig deeper and pay more than the asking price in hopes of getting that perfect home?

The bottom line is that, at least in some parts of the country, it’s a seller’s market and will remain so at least through 2021.

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Tags: Real Estate, Housing Market, New Home, Home Prices, Buyers Market, demand for new housing, first-time new home purchasers,