ROCHESTER, Minn. (KTTC) — Right now is a great time to own a house because interest rates are low, but it’s also a seller’s market.
“The sellers are sitting back like, ‘hey, bring the offers.’ Buyers are like,
‘I love this property. I want this property. What do I have to do to get this home?’ And it’s like, bring your highest and best,” said Joe Skime, real estate broker for North House.
He said the housing market is becoming harder for home buyers.
“The demand is really high and the supply and inventory is very low. It’s driving the prices up, and you’re finding that in a lot of cases buyers are having to compete for very little inventory,” Skime said.
But how does this cause the market to skyrocket?
“So when a property goes on the market at X price when these buyers are competing, they have put in their best offer and it’s forcing them to go above the asking price,” Skime said.
He said prices are up as much as $40,000.
“The average sales price was hovering somewhere around the 200 [thousand] mark just a couple of years ago and now it’s up past 230/240 [thousand],” Skime said.
And for home sellers?
“Sellers are finding that, ‘yeah sure I can sell my house and I can get top dollar, but in a lot of cases I still have to find a place to live. And now I’m finding myself in the shoes of the buyer,'” Skime said.
He said home prices are up nationwide.
The cause could be related to the pandemic but Skime believes the reason is mostly related to the interest rate.
“It’s a great time to still buy a home. The interest rate is extremely low. And that makes it appealing to buyers who have been renting and spending all this money on rent. Because it’s a great investment to be a homeowner,” Skime said.
First-time home buyers are also a concern when it comes to this topic.
“The key is getting in front of a lender and having that sit-down conversation so they can help you put a plan in place and understand how far your dollars are going to get you,” Skime said.