Speculation abounds when the calendar turns to January, and the real estate industry is no different. If 2017 is going to be your year to buy or sell a home, either for yourself, your family, or as an investment, you’ll need to know what to expect. Here’s is what’s on the horizon for the Ann Arbor real estate market.
Photo by Justin Sullivan/Getty Images. Source: Fortune.com
New Construction
Home builders are reported to be hot in action, fueled by higher wages, more available credit, and more demand from home buyers. Here in the Washtenaw County area, new construction continues to be a popular option for many home buyers outside of the city of Ann Arbor. Suburban communities like Pittsfield and Scio Township, as well, as other small towns like Dexter and Saline, are seeing many new construction opportunities. 2017 will be a great year to buy a brand new home in Washtenaw County.
Jobs, Jobs, Jobs
Phenomenal job growth and economic activity is predicted for Ann Arbor by 2018, including the creation of approximately 10,600 area jobs over the course of three years, according to a report from the University of Michigan’s Institute for Research on Labor, Employment, and the Economy. Washtenaw County has outpaced both the state of Michigan and the nation in its job growth rate since 2009. This means great news for the economic growth of the community, and for the real estate market!
Specifically, we can expect to see the largest employment gains in the areas of higher education, health care services, information technology, and research and development.
Historically, people have flocked to major cities for employment, looking to take advantage of opportunities to secure high-paying jobs while facing housing shortages. The good news is that mid-sized cities like Ann Arbor can offer the best of both worlds. Well-paying jobs continue to be available, while housing in or near the city is available, too. Additionally, Ann Arbor offers a variety of housing options for all income levels, and these options stretch beyond city limits. This gives additional options whether the home buyer is seeking a large home on a large lot in a closely neighboring township, a condo downtown, or a single-family home in the suburbs.
Interest Rates: A Recent Hike and More to Come
In December, the Federal Reserve raised interest rates for only the second time in a decade. That’s big news! Every increase in interest rates translates into increased mortgage rates and a reduction in buying power for a home purchaser. A recent Redfin article reports that “already, the 30-year fixed mortgage rate has increased from 3.5 percent at the end of October to just above 4 percent following the election.” A half-percent may seem insignificant, but it on a 30-year, $250,000 loan, that translates into an extra cost of about $25,000 over the life of the loan!
Weekly 30-Year Mortgage Rates, courtesy of redfin.com
Additionally, analysts predict that there will be two more interest rate hikes in 2017, which means that even more of your monthly payment will go towards interest instead of principal.
When interest rates go up, serious home buyers are making a move sooner rather than later. This is the time to get off the fence and act … before the next interest rate hike costs you thousands.
Mortgage Lending Practices Might Help You Out
While interest rates are definitely on the rise, it is expected that it might be a little easier for first-time buyers and others to get that mortgage in the first place. Fortune.com predicts that the Federal Housing Administration will lower fees for first-time home buyers. That’s great news for recent grads, newlyweds, and young professionals who are preparing to step into home ownership.
Ann Arbor Market Continues to be HOT
How can you take control of the real estate market in Ann Arbor? As a home buyer, understand that homes you might want are flying off the shelf as fast as they are being listed. You need to be pre-approved for your mortgage, know your price range, and know what you want and where you want it. What types of homes are selling quickly? Here is a sampling:
- Homes in good condition in good locations are selling within 30 days. That’s fast!
- Homes in great condition are selling immediately at or above asking price with multiple offers! If you want one of these, be ready to pounce the moment you see it. If you’re not, someone else will.
- Lower-priced homes are very desirable and move very quickly.
- Want a ranch home? So do many other home buyers. Be prepared to act fast if one becomes available.
- And, cash offers trump financed offers. So, if you’re in a position to buy with cash, take advantage of your buying power!
Make 2017 YOUR Year
2017 will be YOUR year to capitalize on the bustling real estate market, whether you are a home buyer, home seller, or real estate investor. But, don’t go it alone. The market is moving rapidly, and changing rapidly, too. Rely on us here at PiperPartners Real Estate to guide you and make the process as effortless as can be.
Piper Partners Real Estate specializes in helping you buy and sell houses in the Ann Arbor, Dexter, Chelsea and Saline areas. We understand your concerns about listing your home for sale, and we share your excitement about your future. We work with real estate investors, out-of-town buyers, renters and of course, you! Your circumstances are unique, and so are your home ownership needs. We get that. We’ll start by giving you a free home valuation so you can make a decision that is right for you and your family. Contact us today!
