Are you looking to buy a home, but finding it difficult with all the high mortgage rates and expensive prices? Well, guess what! I've got some good news for you. According to Ali Wolf, who is the Chief Economist at Zonda, more affordable and smaller homes are coming your way! So, there's hope on the horizon!

““Buyers should expect that over the next 12 to 24 months there will be a notable increase in the number of entry-level homes available.””

— Ali Wolf, Chief Economist at Zonda

So, you know, with everything that's been going on, smaller homes have become a thing. When the whole pandemic situation hit, our idea of home totally changed. Like, people needed their homes to be more than just a place to live, you know? They needed it to also be a workspace, a school, a gym, and well, pretty much everything. Those lucky ones with enough space in their homes were able to adapt and keep it that way. But for others, they had to sell their small houses to move on to something bigger. And because of that, the houses that were being listed during the pandemic were smaller compared to the ones before (look at the graph below). And guess what? That trend is still happening even now, you know?

This graph here actually gives you an idea of how the size of homes for sale tends to change with the seasons. It turns out that during the summer months, when families with kids who are on their school breaks are looking to move, you'll find more larger homes hitting the market.

So here's the deal: Seasonality is a fancy way of saying that housing trends tend to follow a pattern depending on the time of year. And since we're heading into fall now, you can bet that we'll start seeing smaller, more budget-friendly homes popping up in the market during the rest of the year. It's like clockwork!

Well, that's awesome to hear because according to Robert Dietz, Chief Economist at the National Association of Home Builders (NAHB), there has been a recent increase in demand for these kinds of homes.

““. . . as interest rates increased in 2022, and housing affordability worsened, the demand for home size has trended lower.””

— Robert Dietz, Chief Economist at the National Association of Home Builders (NAHB)

What Does This Mean for You?

If you've been struggling to afford a home, here's some good news for you. As we head into the later months of the year, there tends to be a seasonal trend where smaller homes hit the market. On top of that, builders are currently introducing more affordable newly built homes. According to Mikaela Arroyo, Director of the New Home Trends Institute at John Burns Real Estate Consulting, this means there's a potential increase in the availability of smaller homes. So, if you've been looking for a more budget-friendly option, now might be the perfect time to start your search!

““It’s not solving the affordability crisis, but it is creating opportunities for people to be able to afford an entry-level home in an area.””

— Mikaela Arroyo, Director of the New Home Trends Institute at John Burns Real Estate Consulting

Bottom Line

If you're interested in the idea of a smaller and more affordable home, I've got some great news for you – they're on their way! To make sure you stay in the loop about all the options available in our area, how about we connect? Let's talk!