As remote work continues to linger on, affordability remains a primary driver in attracting prospective home buyers. Additionally, home sales are rising in concert with home prices, which can be largely attributed to low interest rates and high demand. Struggling to adapt to these changes? We have three tips that will not only help you cope with change but embrace it with a flux mindset. Material shortages and increases in price are hampering multifamily developers. Lastly, with the federal government scaling back on flood insurance subsidies, owners of coastal properties should be prepared for increased costs. All this and more on the newest edition of The Five.
Remote Work, Affordability Driving the Hottest Markets for Real Estate, August 2021 (realtor.com)
With remote work still popular across the country, affordability has been the primary driver in attracting prospective home buyers. Rather than large metropolitan areas, smaller, more affordable cities are receiving all of the attention. Realtor.com’s monthly hottest markets list ranks the top 20 hottest markets. Some of the cities making the cut on August’s list include Burlington, Rochester, Raleigh, and Waco.
New Home Sales Edge Higher in August (NAHB)
Even as home prices continue to rise, we saw an uptick in August in new home sales. Contributing factors include low interest rates and strong demand. Sales of newly built, single-family homes rose 1.5% month-over-month. Sales are up 2.4% in 2021 compared to 2020.
3 Tips to Help You Develop the Mindset to Adapt to Change (Inc. Magazine)
Since March of 2020, change and uncertainty have been the name of the game. You will often hear people say that they cannot wait until the time comes for a return to normalcy. But what if we embrace change instead? A flux mindset is the ability to view change as an opportunity rather than a threat. Three tips are offered on how to adopt a flux mindset: (1) put mindset before strategy; (2) reframe your relationship to control; and (3) think collectively and culturally.
Nearly All Multifamily Developers Hampered by Materials Shortages, Price Increases (GlobeSt)
The eighth edition of the National Multifamily Housing Council Construction Survey was recently published. Data was gathered from August 25 to September 17. 98% of respondents cited being impacted by materials shortages and price increases in materials. This is the highest share recorded since the survey began.
Phase Out of Flood Insurance Subsidies Could Upend Coastal Real Estate Markets (The Real Deal)
One of the benefits of vacation homes and rentals is the luxury of having the ocean right at your fingertips. On the other hand, the risk of flooding rises rapidly in coastal real estate markets. The federal government has historically provided subsidies for its flood insurance programs. However, it is now scaling back. As a result, owners of coastal properties will see a significant increase in the rates they will be paying. From a macro level, this will also increase residential development and home prices. Florida is expected to be one of the states that will be hit the hardest.
Final Thoughts
Just like that, winter is around the corner. As the cooler weather is finding us, the market is not following the same suit with it staying as hot as ever. Homebuyers are showing attention to affordable markets despite material shortages and rising prices.
We’ll catch you back here next month for our next edition of The Five.
Stay safe, stay healthy, and happy (and profitable) investing.
