Earlier this week I received a call from my electrician. I wasn’t surprised by the call since we have an open permit on work he completed a few weeks ago. But things have been crazy busy in real estate for me as well as construction for his business so it hasn’t been a priority. Interestingly, the call had less to do about my electrical job and more to do with my real estate expertise.
It turns out that his twenty four year old son is buying a first home and after being in the fourth multiple-offer situation in less than a month, my electrician was wondering if this is normal. His son’s price range was very low as is the case with many younger, millennial buyers and he was looking for something “move-in ready” too. So yes, it is an extremely very common predicament in the greater Minneapolis/St Paul real estate market.
Right now there is kind of a perfect storm of demand for homes under $150,000—and in some neighborhoods of $200,000, $300,000 and more.
Housing Inventory is Down
- Rising rents—An average of 15% across the country between 2009 and 2014
- Low interest rates—Rates remain around 4%
- Construction investors—Planning to refurbish and flip
- Real estate investors—Planning to refurbish and rent
But as rents rise, so does interest in purchasing a home. A recent article questioned whether millenials are too scared to own a home; I find in Minnesota, this is to the contrary. Many millenials are starting to ask the question, “Should I make that purchase after all? It will be cheaper than renting.” I have spoken with several 20-somethings who are starting to think trading off the option of mobility for more cash in the wallet might be a good plan. But, they are going to have to pack their patience and be ready to write an offer on the spot for the best houses. And, they will have to keep that signing pen at the ready too because they probably won’t get the first home they write on. The demand is HUGE for lower priced properties with “good bones”.
There are ways to write a standout offer in a stack of multiples and I share these tips with buyers I am representing. Contact me for more details.
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