From Dorms to Homes | 1-Minute Market Update w/ Martin

Why are more people applying for mortgages while fewer are searching for homes online? This week, we explore the intriguing dynamics of the housing market. With interest rates dropping by 50 basis points, there's potential for a surge in home searches. We also discuss the soaring home prices, now averaging $398,475, and the ticking clock for buyers who need to act swiftly in a market where inventory is still low. Additionally, we shed light on the evolving student housing landscape, with a noticeable decline in dorm rentals at top universities signaling a shift towards off-campus living.

In today's deep dive, we examine how mortgage rate cuts to an average of 5.58% for a 30-year fixed rate make this a prime time for buying or refinancing. Our detailed analysis reveals how homes are staying on the market longer and inventory is slowly rising, offering a glimmer of hope for eager buyers. Furthermore, we touch upon the significant ramifications for universities as they adapt to changing student preferences and the broader implications for campus culture. Stay tuned to get the full scoop on these critical trends and what they mean for you in the fast-paced world of real estate.

Transcript

Speaker 1: 0:01

Campus crisis, student housing market takes a hit. But before that, let's take a look at this week's housing market data. Today is September 20th 2024, and this is your weekly real estate market update. More people are jumping on the housing bandwagon. The number of people trying to buy a house with a mortgage has increased by 5% this week compared to last week. That's a lot more people dreaming of owning their own place, but online house hunting is slowing down. Fewer people are Googling. Homes for sale is down by 8% more than last month and a whopping 16% compared to last year. Maybe people are getting tired of scrolling through analyst listings. However, with interest rates having dropped this week by 50 basis points of Fed, having dropped the interest rates this week, I would not be surprised if we saw a major spike in Google searches home for sale here in the next week to 90 days.

Speaker 1: 1:03

Prices are skyrocketing. Nowadays, a typical price tag for a house is a whopping $385,375. That's a pretty penny. Sellers are asking for even more. Speaking of prices, the average price tag sellers are putting on homes this week is $398,475. That's what the market's looking like right now. Mortgages are getting pricier. So if you were to buy a house right now, the average monthly mortgage bill is a hefty $2,534. That's thanks to interest rates sitting at 6.2%.

Speaker 1: 1:45

More houses are hitting the market. Looking at the market right now there are more houses for sale now compared to last year. The number of new homes on the market has jumped by 5.1%. Guys, still, inventory is very, very low. It's significantly lower than it should be. Normal market should be around six months and we are way below that. Inventory is on the rise. Speaking of inventory, the number of homes you can actually buy has gone up by almost 16.1%. That's great news for buyers and interest rates are going down. So good for buyers. Great opportunity, a great opportunity. But if you don't take, if buyers don't move quickly, demand will quickly rise again. As interest rates continue to go down, homes are staying on the market longer and houses are hanging around the market. At an average of 37 days to sell a house, which is six days longer than last year, it seems like people are taking their time to find the perfect home. So what's happening over in the multifamily sector Right now?

Speaker 1: 2:55

College students are renting fewer dorm rooms this year compared to the past two. It's like when everyone's hyped about a new phone, but then it turns out. It's not as cool as they thought. The number of dorm rooms rented for this fall is lower than last year, but it's still higher than before the pandemic. This year, only about 92.8% of dorms at the top 175 universities were rented, compared to 94.4% last year, at 95.6% in 2022. Wow, this is a big deal, because it means that fewer students are choosing to live on campus. As more students opt for off-campus living, universities may need to adapt their housing policies and amenities to remain competitive and attractive to prospective students. Additionally, the decline on campus housing could have implications for campus culture and community engagement could have implications for campus culture and community engagement. It will be interesting to see this trend evolve in the coming years and what impact will it have on higher education landscape.

Speaker 1: 4:01

And in other news, mortgage rates are dropping. Since August 1st, the average 30-year fixed mortgage rate has decreased by 55 basis points and the 15-year fixed rate by 54 basis points. The Federal Reserve just cut the federal funds rate by 50 basis points way more than expected and plans to lower rates two more times this year, with more cuts in 2025. Yes, right now, the average 30-year fixed rate is 5.58% and 15-year fixed rate is 4.86%. So this is what this article says, but I have not seen that in the market yet with the people I'm talking about. So this article says that that's the rates. I haven't seen that.

Speaker 1: 4:46

If you've been thinking of buying or refinancing, it's a great time to check out your options, as rates will likely keep falling. This is good news for real estate guys. Fixed rates stay the same for the life of the loan, while adjustable rates arms can change after an initial fixed period. Fun fact, some adjustable rates, like 5-1 arm, are actually higher than fixed rates right now. So unless you're into gambling with your future rates, fixed might be the smarter choice. And that's a wrap. And this has been your weekly real estate market update. I'll see you guys next week. Peace out.