2015- The Best Year Ever To Buy and Sell??

It's February 5th, 2015 and as of today, many records pertaining to the Cedar Rapids area housing market have already been broken and will continue to be broken in the coming months. 
****My company, Coldwell Banker Hedges,  had just over $22,000,000 in pending sales for the month of January.  That is an all-time company record by a long-shot.  
****I closed $1.2 million in sales in the month of January which is almost double what my average January sales are.    
****I only have 2 active listings at this moment in time.  I tend to average 5-7 active listings at any given moment throughout the year.

So what does this tell us?  The record pending sales volume for Coldwell not only speaks highly of this company and the quality of agents and advantages that we provide to our clients, but it also shows you that people are buying houses in record numbers right now.   Traditionally, the winter months are slow, it picks up in the spring, hits the peak in the summer and gently slows in the fall.   This appears to have changed for the time being.   With my record number of closed sales in January, and Coldwell's record number of sale pendings in January, it is clear that December and January were easily some of the best winter months in recent history.  

It also should be noted that it doesn't appear to be slowing down.  With this many people, taking advantage of low interest rates, houses are selling quickly and our inventory is very low.  We need more houses/condos to sell to meet this abnormally high influx of buyers.  This is evident by my current lack of listings.   Nearly everything that I have listed in the past few months has sold.  

So why is now, quite possibly the best time to buy and sell ever?? 

On the selling side of things, you have 2 major factors. 

Low inventory-  If there aren't many houses that compare to yours on the market, then your home becomes more desirable and is likely to sell faster.   With inventory being low and houses selling fast, buyers tend to act quicker and pay more money for houses to guarantee that they get the house they want.  This in turn, tilts the market toward what we call a "seller's market" which puts some of the power into the seller's hands.   
Rising values-  After a few rough years where values around the country dipped, we have seen a steady increase in value.  Depending on the quality, location and condition of your home, there is a good chance that you may be able to sell for a higher price today than you would have sold for 2-3 years ago.

On the buying side of things, you have 2 major factors.

Low Interest Rates-  After experiencing record low interest rates over the last few years, all signs indicated that they would slowly start increasing and we would never see rates this low ever again.  The rates did indeed start to go up in 2014 but here we are again, back in the 3% range.  It is likely that even if you refinanced in the last few years, you will still be able to secure an unbelievably low interest rate on a new home.  If you are a first time buyer, your mortgage payment will undoubtably be lower than your current rent payment and by renting you are just throwing your money away every month.
Housing affordability-  Housing in our market is very affordable compared to other areas in the country.  You can get a very nice home in all price ranges.  Looking at trends dating back decades and decades before us, most experts predict that we are on the upslope of values.   It is inevitable that home values and construction costs will continue to rise throughout 2015 and into the future.  Combine that with interest rates likely to rise, what you can afford now may not be attainable by the end of the year or into 2016.  Buy now and secure a price and interest rate that you are happy with.

Just for frame of reference, let's say you bought a $120,000 house 5 years ago.  I'm guessing your monthly payment is around $875/month.  Assuming you have paid down some of the principal balance as well as made some nice upgrades to the house, you have built up some equity.   Let's say between paying down your mortgage and adding some extra value to the house that you are able to walk away from the sale of the house with $20,000 for a down payment on a new house.  With today's roughly 3.5% interest rate and your $20,000 down payment, you could buy a $170,000 house and have the same monthly payment as you currently have in your $120,000 house.  Your estimated payment on $200,000 would only be about $150 extra per month.  Now, that is some incredible incentive to sell and buy!   Obviously, I am not a lender and these figures are estimates and hypothetical.  You would want to talk to your lender to verify what interest rates and programs you qualify for.   I have some incredible local lenders that I like to work with and are able to get you the best deals.  Let me know if you would like me to send you their contact info.

I am always here to help and advise you in all things real estate.  Please don't hesitate to contact me in case you have any questions or concerns.   Market analysis' of your home and monthly payment estimates on a new home are always FREE and I am more than happy to meet with you to discuss if now is a good time to sell or buy.  Much love to you all in 2015.  I hope it is an amazing year for you and I hope to see you sometime soon!
Mike Schulte, REALTOR
Licensed in the State of Iowa

Coldwell Banker Hedges
2200 1st Ave NE
Cedar Rapids, Iowa 52402

cell: (319)361-7091
office: (319) 364-8121
fax:    (319) 364-4829

"May your home always be too small to hold all of your friends"
-Irish Wisdom 

Mike Schulte

Mike Schulte

REALTOR® - Licensed in the state of Iowa
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