Homeownership in 2023

 Whether you are purchasing a home or selling a home, it is a very personal decision. The house you sell or buy is your home that you will spend a good part of your life. It is also a big financial decision that can affect your finances. To make the best decision for you, professionals in the industry reveal what the real estate market looks like in 2023. 

As you begin the search of finding the right home, many start by looking at listings. According to the National Association of Realtors in 2022 almost half (47%) started the process by looking for a home online. Buyers that were younger than 41 had around 60% that purchased a home online. This actually is a good way to handle the process due to the frenzy and fury of buyers in the market. As of April 2023, the median home price for existing homes was $388,800 which was a decline from a year ago. Even with the decline, the stats were up from recent months.

Once you find a home you want to buy, you have to secure the finances. Getting a pre-approval from a mortgage lender will help you in the buyer’s market. This also goes along with a down payment which can be daunting. It was reported that 26% of first-time home buyers agreed that saving up for a down payment was the hardest part of the home-buying process.

Baby Boomers have been at the forefront when it comes to purchasing a home, but there is a new generation, the millennials who have taken over. In 2022 millennials were noted as the largest home buying age group at 43%. Sixty percent were married couples while single women were next at 19%.

If you are in the market to purchase a home, contact a local realtor who can help you through the process. A Realtor can also recommend a mortgage lender who can help you with the financing aspect of purchasing a home.

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Five Reasons Why To Always Get a Home Inspection

Buyers are finding ways to get their contract to win in bidding wars but there is one thing they should not skip out on. Some buyers today are skipping home inspections to entice sellers to choose them, however, this is not in the best interest of any buyer.

“With a lack of housing inventory in Louisville and across the country, it’s tempting for buyers to waive the home inspection, but there’s extreme danger in doing that,” Brad Lawler, the HomeTeam Inspection Service owner of HomeTeam Inspection Service of Kentuckiana says. “Waiving an inspection can open a buyer up to unforeseen costs down the road that could have otherwise been avoided.”

Here are five reasons why you should never skip a home inspection according to Lawler.

1. An inspection can help buyers avoid overpaying.

With such a hot market, home prices are on the rise and buyers are already paying a premium for a home. According to a report released by Redfin, the median home price in the U.S. rose 17% year over year to $341,250. Bidding wars are causing buyers to bid asking and often over asking, so added expenses for repairs are not usually feasible.

“Recently, one of our home inspectors uncovered a structural problem that ended up costing the seller $35,000 to repair,” Lawler says. “If the buyer had purchased that home without an inspection, they would have not only paid a premium for the home but they would have also been forced to handle the costly repair on top of it all. It’s a fast way to rack up negative equity. Today’s buyers are already overspending, so taking on additional risk by waiving the inspection is cause for concern.”

2. An inspection can uncover problems that the seller might not even know about.

By law, sellers are required to disclose any problems they are aware of, but this does not mean there aren't underlying issues that they might not know about. An inspector can make sure all issues are out in the open and can be resolved. A buyer can negotiate the price of the home to reflect the cost of the repairs.

“I don’t know many sellers who would have gone into their crawl space or climbed up onto their roofs prior to putting their home on the market,” Lawyer says. “We’re also seeing a lot of issues on homes that have exterior insulation and finish systems. If that type of product is installed incorrectly — and it often is — it can cause significant damage to the house because water will permeate the system.”

3. An inspection gives buyers a chance to budget for future repairs.

“One of the things that we do at HomeTeam is provide buyers with a punch list of maintenance items, so they can start to budget for future repairs and replacements,” Lawler says. “For example, we look at the age of the HVAC system and offer buyers a timeline of how long it will likely last. You don’t want to wait until something breaks to fix or replace it.”

4. An inspection can uncover problems that might affect your health.

Things such as radon cannot be seen, smelled or tasted so the only way to make sure the home you are purchasing does not have radon is to test for it. A home inspection will include environmental testing looking for mold, lead paint, air pollutants and pests.

“Unfortunately, we often have problems with radon in Louisville because of the type of lot that the city is situated on,” Lawler says. “Radon is the leading cause of lung cancer for nonsmokers and it can be in any type of home. It doesn’t matter if it’s brand new construction or a third-floor condominium.”

5. An inspection can prevent buyers' remorse.

“Buyers are closing on houses faster than ever in order to stay competitive and we’ve been getting a lot of buyers’ remorse calls lately,” Lawler says. “We recently heard from a buyer who was advised by his agent to skip the home inspection in order to close quickly on the home. When the buyer walked into their new home they were met with serious electrical problems that will likely cost thousands of dollars to repair. It doesn’t have to be that way,” Lawler says. “A home inspection shouldn’t be an obstacle. At HomeTeam, our goal is to help real estate agents and buyers reach the closing table with the knowledge that they’re making an informed decision. You can’t do that if you waive the inspection.”

If you are considering purchasing a home, call a local Realtor who can help you through the process. A Realtor will be able to determine what's in your best interest when it comes to making an offer on your next home.

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Reasons to Buy a Home

From a survey conducted every 2 years by the National Association of Homes Builders (NAHB), builders and Realtors can learn and understand what the “average home buyer” wants in the home that they are buying.  This survey is very important in detailing a buyer’s reasons to buy a home.   From a broad perspective, the survey indicated that over 55% of home buyers would prefer to buy a new home vs. a pre-existing home, but the actual percentage of home buyers buying new homes was only 11% from 2011 – 2013.  However ,this 11% was actually a 3% increase from 2008 when only 8% of home buyer bought a new home.

Size, floorplan, price and neighborhood scored in the top 70th percentile as reasons to buy a home by home buyers surveyed by the NAHB with the aesthetics and safety playing an important role in the decision to buy in a certain neighborhood.  In St. Tammany Parish, Bedico Creek Preserve offers a master planned community in Madisonville that scores highly on not only beautiful homes and an almost completely safe neighborhood location, but also, with 10 Neighborhoods within the subdivision from which to choose, new home buyers also get to enjoy lots of variety in choosing not only a house to buy but also a lot location on which to build a new, custom home, if desired.

The NAHB also said that good schools tended to be important to new home buyers especially.  Madisonville, Louisiana, boasts the best school district in St. Tammany Parish which already scores as one of the best school districts in the state.  Many home buyers’ reasons to buy a home in Bedico Creek is because of its excellent school district.

Another important factor found in the survey was that buyers of new homes valued quality construction especially when using a builder to build them a new home.  The construction, durability, and beauty of the home was extremely important to them.  In Bedico Creek, we have 14 new home builders that are available for a consultation on either building a new home on a lot purchased in our community or buying a new home built by our quality builders in St. Tammany Parish.

According the National Association of Home Builders,  Bedico Creek Preserve scores highly across the board for all of the features that are important to new home buyers which is probably why the homes and lots in our new subdivision are selling out so quickly.  Don’t miss your opportunity to own a new home in the fastest growing master planned community in St. Tammany Parish!  Contact Us at 985-845-4200 or E-mail Info@LiveBedico.com.

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Student Debt Is Not an Obstacle to Homeownership

According to a study done by Zillow.com, the only way student debt can negatively impact young professionals interested in starting a family and “settling down” to buy their first home is if that debt is combined with no degree at all.  According to the study, student debt is not an obstacle to homeownership with those students who finished with a bachelor’s degree or higher for the amount of debt they acquired.  Home buyers that are college graduates and never had to take on student loans have a higher chance (70%) of becoming a homeowner than home buyers that have student debt and at least a bachelor’s college degree, but not by much – the statistic only drops to 66% for these types of buyers.

Because of the Recession and the lack of jobs for college graduates upon completing college, many young people did not get married and start a family right away, so household formation was also a considering factor in the study done by Zillow.com.  The study seemed to indicate that people were waiting until their 30’s to have children, and the study included those couples that had actually started a family with at least one child.

High rents were also a factor as being a deterrent for young professionals to be able to buy a home.  The payment of higher rent made it impossible for them to get the larger down payment together upon trying to get financing for a conventional mortgage.  The FHA just recently reduced the percentage of down payment required for both FHA and Rural Development loans, so this factor will not be as pertinent moving forward.

The truth about young professionals becoming homeowners is that student debt is not an obstacle to homeownership, and the possession of a bachelor’s degree or higher and the acquisition of a good job after college has made it possible for these students to be able to buy a new or pre-existing home upon graduation (or later).  This is good news for the housing market as one more positive sign that the real estate market is moving in the upwards direction.

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