Real estate experts share a message for home buyers as they predict rising home prices through 2025
Real estate experts are urging home buyers not to wait as mortgage rates remain high and home prices are expected to rise.
Jenny and Dolly Lenz of Dolly Lenz Real Estate joined "The Claman Countdown" on Tuesday to discuss what they’re witnessing in the turbulent housing industry and what it means for first-time home buyers.
"We are expecting new home sales to rise again. It’s the sweet spot in the market," CEO Dolly Lenz explained when describing what to expect during the spring market.
"A builder has a lot of tools in his belt, so to speak. So, they’re using their tools and they’re selling. They’re not waiting for anything else to happen. They want to get things sold right," she continued.
"They have scale. They have pricing power. Unlike the regular ‘Average Joe’ seller, they can offer a lot of concessions," Jenny added.
Jenny, the Dolly Lenz Real Estate managing director, argued that she can see the market "doing well" for home builders but not for first-time buyers.
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"On the other side of the coin, you have the first-time home buyer who’s really, really struggling," she stressed.
Jenny also said that the high mortgage rates are a lingering concern in the industry.
Amid high insurance costs, median home prices and gas, Dolly suggested that it’s not a good landscape for the non-asset rich.
"The people who are struggling are the ones who are paying the high interest rates, don’t have assets to offset."
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As the industry presents a series of challenges for home buyers, experts are urging those who are looking to buy to "jump in if you can."
"Well, unfortunately, we don’t think you should wait because Freddie Mac is even predicting a 0.5% increase in home prices through 2025," Jenny said.
"So, if you can buy and you’re a little bit settled, meaning you have a job, obviously, and you know where you’re going to live, we do recommend to buy because we don’t see home prices coming down anytime soon," she further warned.
"We don’t know anyone really who was unhappy they got on the property ladder," Dolly expressed, explaining that being "on the property ladder" gives people "some asset and some maneuverability."
But for those who are not in the market to buy and simply want to rent, they are also feeling the economic strain.
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"Interest rates affect rents, too. So, rentals are also at all-time highs," the Dolly Lenz CEO expressed.
"Like Jenny always says, you're going to be living with your parents, you're going to be buying or are you going to be renting? Only one of those is cheap," Dolly explained.
But rising costs aren't the only obstacle for buyers. Low inventory has also plagued the housing industry.
"We do have an inventory problem even though inventory did increase 4.7%," Jenny explained.
But Dolly noted there’s good news for buyers as baby boomers are looking to move, downsize, rent and tap into "various other options."
"They’re going to put 9 million homes on the market over the next 10 years. So that will do a lot to shore up the shortage," the CEO said.