With appreciation reaching an incredible 12-13% in 2020, how do we make sense of the chaos? Is it better to build a new home, buy an existing home, or renovate the one you are in?
Well, that depends. First, some questions.
- How long are you planning to be in the Winston-Salem area?
- Do you have cash to spend on home improvements?
- Is your location critical (for example, do you want to be in a certain school district)?
- Are you handy?
Navigating the home buying process in this market is really, really tough. It is important to take 2020 home values and forget them (as in completely erase them from your memory. Easy to do right?).
Also, forget the word “over-priced” and replace it with “market value.” Don’t like that? Well, if you are buying AND selling, you will likely accept this one a little faster.
What comes up must come down, right? Yeah, but when? When do lumber prices come down so building costs are more affordable? When does supply outweigh demand so previously owned homes become more affordable? Shake your Magic 8 ball, because that “guess” is as good as anyone else’s.
The bottom line is this: None of us can see into the future, so make the best decision you can for your family based on current market conditions. You can win or lose, but trying to “time” any market, including the real estate market, is nothing but an educated guess. Waiting to make the “right” decision can cost you money, but more importantly, it could cost you irreplaceable family memories.
Not planning to settle long in the Winston-Salem area? Lean towards new construction. The market is unlikely to decline significantly in the short term, so values should remain high. Building costs also remain high, so the competition from other new construction will be limited.
Have cash to spend on home improvements, and are you handy? Lean towards a previously owned home. With cash to invest, you can afford to make the home “your own.”
Is location critical? Roll the dice. Demand has grossly outweighed supply, so you are unlikely to have many choices in your preferred location. Remember that if you love the location, so do many other ready, willing, and able buyers!
What’s the takeaway? Manage your expectations, and remember that there is no such thing as perfect. Expand your criteria, be creative in your offer strategies, and remember that it is family that makes a house a home anyway!
Welcome Spring. Fire up the grill and practice your short game!
Tori