Q&A talks about the spring home-buying season with Candace Adams, president and CEO of Berkshire Hathaway HomeServices New England Properties.
Q: So how is this spring’s home-buying season shaping up? Are we expecting higher sales this spring compared to last year? What about home prices?
A: Prices are stable. The pending market is up significantly year over year in spite of the weather. Providing the inventory levels meet demand, prices will remain fairly flat.
Q: Which end of the housing market (high, middle, or low end) do you expect to perform the best? Which do you expect to perform the worst? Why?
A: The first-time buyer market is going to get some momentum due to low interest rates and loosening of the homebuyer credit guidelines. As they enter the market we will see some movement in the middle market as well. The luxury market will be stable, and available inventory will impact pricing.
Q: Are brokers using any new technologies to sell homes? What about drones? I’ve heard realtors talk about using drone photography as part of their marketing.
A: Drones will become part of the technology used by Realtors when the laws around using them are clear. It is expected that a bill will pass in Congress allowing drones to be used in certain geographic areas below 400 feet.
There are many new technologies, including 3D visual tours and mobile applications that will improve the customer experience. Research and analytical tools are improving the ability of Realtors to accurately predict trends and pricing.
Q: How will the looming threat of higher interest rates impact this spring’s housing market?
A: The threat of higher interest rates typically takes buyers off the fence. Those who have been in the “wait-and-see mode” will enter the market. Investors are likely to move quickly as well. It is inevitable that rates will increase and it will have a predictable impact to the cycle.
Q: What other interesting trends should we expect this spring?
A: All indicators point to an active spring market.
There are not likely to be robust gains in average sales price. Homebuilders are gaining a level of confidence to re-enter the market, so I anticipate more new homes starts.
Employment and consumer confidence will drive the momentum to the extent that there was pent-up demand, however, factors impacting Millennials from entering the market remain the same, including high student-loan debt, employment and the desire to have flexibility. Those who are buying are moving more toward metro centers and less to the suburbs.
