Real Estate Headlines:

17.8M Homes Are Now Considered ‘Equity-Rich’:  Housing appreciation has grown over the last few months with the surging real estate market. Thirty percent—nearly one in three—of homes with a mortgage in the U.S. are now considered “equity-rich”, meaning that the combined estimated amount of loans secured by the property is 50% or less of the estimated market value. In short, it means homeowners themselves have accumulated at least half of the equity in their homes.

Home Sellers Are Feeling More Optimistic:  According to Fannie Mae’s Home Purchase Sentiment Index, as home prices rise by double-digit margins year over year, homeowners are increasingly viewing selling favorably.  Some key highlights from the survey include:

• 52% of consumers say it’s a good time to buy a home, mostly unchanged from Dec. 2020.
• 57% of consumers say it is a good time to sell a home, increasing from 50% the month prior.
• 41% of consumers believe home prices will go up over the next 12 months.
• 75% of consumers say they are not concerned about losing their job in the next 12 months.

New-Home Buying Rush Likely to Continue in 2021:  More house hunters—particularly move-up buyers—are being drawn to new-home construction in the COVID-19 pandemic, so much so that it’s driving a surge in construction across the country.  Single-family starts ended 2020 with the best year in home building since the Great Recession, and 11% higher than 2019.  Builders, however, are concerned about several challenges that could affect sales over the next few months, particularly related to rising construction costs. Lumber prices, up 169% since mid-April, are significantly adding to the costs of building a new home. 

Energy Efficiency Drives Interest in New Homes:  Energy efficiency is a primary driver in homebuyer preferences for a new home, according to newly released research from the National Association of Home Builders.  Buyers said they were willing to pay, on average, $9,292 more upfront for a home if it meant they could save $1,000 annually on utility costs.  The top green features buyers said they desired in their new home:  Energy Star–rated windows and appliances, Efficient lighting that uses less energy than traditional bulbs, Energy Star rating for the whole house.

The ‘Cloffice’: Is That a Closet or an Office?:  Enter the era of the “cloffice,” the latest trend in home design as the need to work from home continues during the pandemic. Homeowners are taking their work from the dining room table into a more private space to work from. The closet is growing more appealing.  Good lighting, organization, and comfort are key.  Bring in a desk and use a comfortable desk chair that fits properly. Also, dress up the closet space with wallpaper or artwork on the walls. 

What Sellers Should Not Display in Their Home Office:  The home office has become an important space to stage, but certain memorabilia displayed could turn off some buyers who view the property in-person or online.  For example, college degrees and other homeowner achievements on display should be removed prior to listing the house on the market. This includes any regalia from your alma mater.  Also, be sure to remove any political signs or religious items to avoid giving the house a feeling like your “domain” and not theirs.  Put away any work swag, too, like your company’s logo or any other confidential information that could be linked back to you.

Buyers of New Homes May Be Able to Stretch Their Budgets:  Thanks to the higher costs of owning and maintaining an older home, some buyers may be able to afford more expensive mortgage payments if they choose a newer home.  Buyers could potentially spend 36% more on a newly built home compared with a home built before 1960, because of the lower operating and maintenance costs of buying new.