Here’s what’s happening with Zillow and our local real estate market.
Have you heard about Zillow? The popular real estate website apparently bit off more than they could chew. They were buying up properties based on their algorithm, but when they went to flip these homes, they ended up losing millions of dollars. How will this news affect our market?
As of now, Zillow has laid off a big chunk of their workforce, and they’ve had to cancel their iBuying program. They currently have 18,000 homes they need to sell but don’t expect a ton of deals to hit the market. Supply chain issues and labor shortages make house flipping much more expensive than it used to be, so Zillow will probably sell them to corporate buyers or use them as rental properties.
In other news, home prices are expected to increase in 2022, although not as much as last year. Last September, the median home price increased by 13% to 20% from the previous month. That’s an astronomical amount of growth, so don’t expect anything like that this year. On top of that, interest rates are increasing, making houses less affordable. Given this, is it still a good time to buy?
Ultimately, your decision to buy a home should be based on your needs, not market trends. In the grand scheme of things, interest rates are historically low. For reference, the first home I bought had a 7% interest rate. Plus, sellers tend to be more serious in the winter. If you want to take advantage of our good rates while you can, now may be the time.
If you have any questions about today’s topic or anything else, please call or email me. I’d love to help!