Massachusetts & Southern NH Real Estate Industry News

Welcome to our blog! The purpose of this real estate blog is to provide some tips for staging your house, simple easy updates, what to do in the areas, all for you to enjoy. We plan to publish this blog monthly, so please subscribe or check back often!

June 30, 2022

The Impact of Rising Interest Rates on Home Prices

 

 

Will increasing interest rates impact home prices? With interest rates rising, it is causing some to believe that a housing crash is inevitable. Is that truly the case?

 

In our latest episode of “Yay or Nay,” we take a look at how interest rates impact home prices. What you hear might surprise you.

 

 

How Do Interest Rates Impact Home Prices

The increase in interest rates starts a snowball effect that impacts the overall price of homes. When interest rates increase, unfortunately, it does mean that some individuals will exit the housing market because of the increase in monthly payments. Because of that, it’s reducing the demand. Additionally, we’re starting to see more homes come onto the market, increasing supply. So, we’re left with the basic principles of supply and demand. 

 

How are we seeing this impact the housing market? A few months back, a home that was listed for $500k was selling for $600k. We were seeing that nearly every home was selling for tens of thousands above asking. Now, with fewer buyers in the market and more inventory, there’s less of that competition so homes are not going for as much over asking. Now keep in mind that you will still see homes go for over asking, however you may see a home sell for $25k over asking as opposed to $100k. 

 

The main point is that home prices are not going down. We’re not seeing depreciation because interest rates have climbed. However, we are seeing that you’re not going to have as many bidding wars and you’re not going to see a home sell for that much over asking. 

 

Homeowners from Q1 of this year to Q1 of last year made on average about $60k in equity. Additionally, homes are anticipated to still appreciate by 10.8% through the end of this year. Next year, experts predict that we will see homes continue to appreciate by 3.2%. Even with higher rates and less buyer demand, homes are still going to increase in value. We’re also still seeing that homes are still appreciating. It’s not that we are seeing demand drop out completely in the housing market and that the market is crashing. The market is changing - and if you’re looking to buy, you’re going to find that you have more options available, can get better terms, and always have the option to refinance down the room. A home is still a great investment, don’t let the headlines in the news scare you away from thinking that. 

 

The best thing to do if you’re looking to buy is to stay within your means and talk to your lender so they can help you figure out a realistic budget that will account for some interest rate fluctuation. If you were pre-approved six weeks ago, you should have another conversation with your lender now that rates have changed to ensure that you’re still approved for your original amount, now that your monthly payments have likely changed. If you don’t, see what other programs are available! Options like a 5 or 10-year ARM are great alternatives at this point. 

 

Bottom Line

Rising interest rates do impact home prices in the sense that you’re more likely to be able to get under contract on a home for less than you may have been able to a few months ago. More than likely, you’ll also be able to include better terms that benefit you as the buyer. However, it’s important to know that rising interest rates won’t cause the value of homes to decrease. Experts are forecasting appreciation through 2026. So, if you’re looking to buy today, keep this in mind and also remember that you can always refinance down the line should rates drop. There are also a variety of programs available out there that can help you secure a lower interest rate. Have those conversations with your lender today and work with your agent to see how they can help you get into your dream home this summer.

 

Posted in Buying a Home
June 20, 2022

Interest Rates Increased Again - What This Means For You

 

 

Yesterday, the Federal Reserve took its most aggressive step yet to combat inflation, raising interest rates by 0.75%. This rate increase was the largest yet since 1994 and could be followed by a similar move next month. We’re going to be nearing 7%, which we know sounds scary! 

Officials expect interest rates to hit 3.4 percent by the end of 2022, according to economic projections they released Wednesday, which would be the highest level since 2008. 

This move has opened the door to a lot of questions such as “What does this mean if I’m looking to buy?” “What does this mean if I’m looking to sell?” 

Let’s take a closer look. 

Impact on Buyers

We know that these headlines are scary, and if you have been thinking about purchasing a home, we understand that you might be hesitating. The increase in mortgage rates will indeed impact your monthly mortgage payments. What you may have been able to afford a year ago may not be what you can afford today due to those increased rates. 

However, the increase in rates has a silver lining. In the past, many buyers were deterred by the bidding wars that took place with almost every property that hit the market. Previously, to get your offer accepted, you would have to offer far over list price and waive contingencies. Today, we’re seeing that buyers can offer much closer to list price and maintain some of those important contingencies such as home inspection and appraisal contingencies.

Additionally, if you’re concerned about purchasing a home just for the market to crash, you can take comfort in knowing that the experts don’t foresee that happening. On average, industry leaders predict that homes will continue to appreciate throughout 2022. On top of that, owning a home is the number one hedge against inflation, and with appreciation predicted to continue, you’re setting yourself up for one of the best investments you can make. 

 



Finally, it’s important to keep in mind that there are many programs out there that are designed to help you purchase that perfect home. With rates increasing, it’s more important than ever to talk to a variety of lenders and see what programs they have to offer. Looking outside of the traditional conventional loan may open the door to opportunities to secure a lower rate or come up with some creative solutions to help you purchase that home.
 

Impact on Sellers

The big question we hear with sellers is, “Am I too late?” Our answer for you is, no! One key reason why the experts are confident that we will not see a housing crash is due to the sheer amount of demand that exists in the marketplace. It’s true that the competition has decreased from previous months, however, it is still a seller’s market. 

It’s important to keep a couple of things in mind, however, if you do decide to sell in this market. First, a home must be priced correctly. Home buyers are pickier now that they have more options, and pricing too high will result in your listing sitting on the market - in some cases for more than a month. To attract the most buyers, your home needs to be priced in line with what the market is dictating. Working with a local agent who understands the market in your particular area will allow you to price your home where it needs to be. 

Next, it’s important to keep in mind that while you’ll likely still receive strong offers, buyers are not going to quite the extreme that they used to. You may now only receive one or two offers on your home, and you might not get as much over asking as you may have heard stories of back in 2021. Additionally, contingencies are coming back, so don’t be surprised if you start seeing inspection contingencies work their way back. 

Bottom Line

The scariest part of the interest rate hikes that we’re seeing right now is the speed at which it’s increasing. It causes many to fear the worst, and assume that the sky is falling. However, there’s some great opportunity out there for those buyers looking to get creative with their mortgage options and take advantage of the increasing inventory. For sellers, it’s still a great market. However, it’s critical now to work with a local real estate expert to help you price and market your home the way you need to with greater competition.

Posted in Market Update
June 6, 2022

Living in Lowell

 

 

Location

Lowell is a city in Middlesex County with a population of around 111,000 residents. As the fifth most populous city in Massachusetts, Lowell was founded in 1826 as a mill town. Lowell is filled with converted factory buildings, cobblestone roads, and a rail trail that goes right along the Merrimack River. 

Lowell is also home to two institutes of higher education including UMass Lowell, part of the University of Massachusetts system, and Middlesex Community College. 

Lowell consists of eight distinct neighborhoods including the Acre, Back Central, Belvidere, Centralville, Downtown, Highlands, Pawtucketville, and South Lowell. 

 

 

Community

Lowell has a rich history, rooted in the industrial revolution. Cobblestone streets weave in between towering brick mill buildings that have been converted into anything you can imagine. Retail space, museums, restaurants, and art galleries are just a few of the amenities to explore, and the possibilities are endless. 

Lowell also holds several annual events including:

Lowell 4th of July Celebration - Enjoy a 4th of July celebration at LeLacheur Park! There are 5,000 seats available free to the public with additional viewing along the River Walk. Feel free to sit in the stands or on the field with your blanket! There will also be a wide variety of treats available from local food trucks. 

Lowell Folk Festival - This festival includes performing groups sharing their unique musical traditions throughout downtown Lowell, as well as multicultural community food and art vendors. The Lowell Folk Festival attracts more than 150,000 people for three days of fun!

City of Lights - This Lowell tradition kicks off the Winter holiday season! Enjoy the City of Lights Parade and welcome Mr. and Mrs. Claus with the traditional lighting of JFK Plaza and Wannalancit smoke stack. Enjoy photos with Santa, a holiday movie screening at the Donahue Family Academic Arts Center, and the annual hot chocolate and window decorating contests! 

Lowell is also home to many historical attractions including the Lowell National Historical Park, where you can explore the living monument to the dynamic human story of the Industrial Revolution that is the city of Lowell. 

For those looking for some outdoor fun, Lowell is home to several trails and hikes. Enjoy the Bruce Freeman Rail Trail, a 25 trail that will extend from Lowell to Framingham upon completion (scheduled for November 2022).

You can also enjoy a day hike through Lowell-Dracut-Tyngsboro State Forest. The forest spreads across 3 towns and features over 1,000 acres to explore. Hike, bike or ski through 5 miles of trails, and enjoy ponds, swamps, and wetlands perfect for boating or fishing. 

Restaurants

One of the best parts about living in Lowell are the number of coffee shops, restaurants, and specialty foods available to you! We’re sharing some of our favorites!

Coffee Shops

Nibbana Cafe 

Little Delights Bakery

Brew’d Awakening

Coffee and Cotton

Rosie’s Cafe

Restaurant

TreMonte Pizzeria Restaurant & Bar

El Jefe Taco Bar

Mill City BBQ and Brew

The Purple Carrot Bread Co.

Life Alive Organic Cafe

Cobblestones

Tasty Dumpling

Schools

12 elementary schools, 6 middle schools, 2 high schools, and 2 colleges are spread out among the 8 predominant neighborhoods of Lowell. 

Below are links to the web pages for each of the public schools in Lowell:

 

Bailey Elementary School (PreK-4)

Greenhalge Elementary School (PreK-4)

Lincoln Elementary School (PreK-4)

McAuliffe Elementary School (Prek-4)

McAvinnue Elementary School (PreK-4)

Moody Elementary School (K-4)

Morey Elementary School (PreK-4)

Murkland Elementary School (PreK-4)

Pawtucketville Memorial Elementary School (PreK-4)

Rielly Elementary School (K-4)

Shaughnessy Elementary School (PreK-4)

Washington Elementary School (PreK-4)

Butler Middle School (5-8)

Daley Middle School (5-8)

Robinson Middle School (5-8)

Stoklosa Middle School (5-8)

Sullivan Middle School (5-8)

Wang Middle School (5-8)

The Career Academy (9-12)

Lowell High School (9-12)

 

Final Fun Fact
Lowell is perhaps best known for its mills. Colloquially known as the birthplace of the American Industrial Revolution, many history books make mention of the Lowell “mill girls” who helped churn out textiles. By the late 19th century, women held nearly two-thirds of all textile jobs in Lowell.

Posted in Living In Series
May 23, 2022

What Does A Recession Mean For The Housing Market?

 


Deutsche Bank caused a stir in April when they became the first major bank to forecast a US recession. Today, they’re standing by that prediction more than ever as the Federal Reserve continues on its quest to knock down inflation through rising interest rates.

We know that the word “recession” is typically met with a grimace, especially when paired with the housing market. However, let’s take a closer look at the definition of recession. A recession is a period of temporary economic decline during which trade and industrial activity are reduced, generally identified by a fall in GDP in two successive quarters. 

 

The definition does not say anything about a housing market crash. A recession does not mean that the market is a bubble that’s about to burst. It does not mean that you should give up on your buying or selling goals. It does mean that there are unique opportunities out there for those who know how to navigate the current market conditions.

 

Today we’re taking a closer look at what a recession means for the housing market and what it means for your real estate goals.

 

Where We’re At

Imagine you’re driving on the highway, doing 90 mph in a 65 mph zone. You’re flying down the road with the music on and the windows down. Suddenly you hear sirens and see those blue flashing lights coming up behind you. You start looking around, your heart speeds up again, and you drop your speed from 90 mph to 75 mph. You’re still speeding, but it feels very slow compared to the speed you were going. You’re more alert to what’s going on, getting ready for the inevitable speeding ticket. 

 

When the cop approached you, much to your relief, he goes around and continues down the road. 

 

That is the market right now. We’re been driving 90 mph the past couple of years. However, over the past few weeks, we’ve essentially hit the breaks as a response to the recent market shifts, and while we’re still speeding, it feels like we’ve gone from flying down the road to moving at a snail’s pace. When in reality, homes simply shifted from 7 days to 10 days on market, for many this feels like a giant leap and change. 

 

Let’s not beat around the bush. We’re headed towards a recession. It’s a big, scary word that many people shy away from. However, since 1980, we’ve seen 6 times of recessions, and during 4 out of 6 of those times, home prices continued to increase. 

 

Keep in mind that in 2008, there were fundamental differences between the housing market then and now. It should not be assumed that we are heading down the same path.

 

This goes directly into something that we hear very often, “I’m going to wait for the market to crash and wait for prices to go down.” If you look historically, since 1993, we have had 8 different instances where interest rates have gone up very quickly, more than 1%, in a short time. During these instances, we were also facing increased appreciation. In every one of these instances, home prices have gone up. 

 

Now, let’s look conversely at sales. All of these different times, sales have decreased. It’s the same thing that we’re facing now. In MA & NH, we’re down when it comes to sales. We have 20% fewer sales than we did last year, yet prices are still going up.

 

What we’re going through is no different than what we’ve experienced before. It feels different because many of us haven’t gone through this at all when it comes to buying or selling. 

 

What Does This Mean For You?

One thing that we hear all the time is, “I’m going to wait for the market to crash.” How do you know it’s going to crash? What if it doesn’t? If you’re renting, the only thing going up faster than appreciation and interest rates is your rent rate. Either way, you’re paying a mortgage. Are you paying your mortgage or your landlord’s mortgage? 

 

Regardless of what the market is doing, if you’re going to buy a home, the number one reason you buy a home is to improve the quality of your life. When you’re evaluating if you should buy or sell now, think big picture. Is my home going to be more improved by staying in my rental or family home or by purchasing a home that you can then gain appreciation and equity in?

 

Remember, you’re not buying the market, you’re buying the asset. If you’re looking to buy or sell, go out and talk to your agent. Don’t just assume that because rates will go up, prices will go down. Experts predict home will appreciate through 2026. Indeed, they won’t appreciate at the rate we saw last year, but prices aren’t expected to go down. 

 



Bottom Line

The word recession is an inherently scary word that causes many people to think the worst is bound to happen. If you’re thinking about buying or selling, thoughts of a repeat of 2008 are bound to enter your head. We’re here today to point out that you don’t have to be afraid of a recession. It happens and has happened, multiple times without causing home prices to plummet. Instead, it’s a great opportunity for you to speak with an expert in the real estate industry to get a better understanding of what it means for your real estate goals. There is opportunity out there for those who are willing to take the time to truly understand what’s happening in the market and how to take advantage of it. 

May 12, 2022

Interest Rates, Inventory, and Home Prices - April 2022 Housing Market Update

 

 

Are you curious about how the rising interest rates have impacted the Massachusetts housing market over the last 30 days? Today, we’re breaking it down and giving you a quick market recap of what's happened over the month of April. It's been a little bit of an interesting month as you've probably heard. If you've been paying attention to anything in the media, interest rates had their biggest two-week climb in the history of what we've been tracking for interest rates. A 30-year fixed loan is sitting above 5.5% percent for the first time in well over 10 years. A lot of people have asked us what does that mean for the housing market? Keep reading to get our thoughts!

 

Taking a Look at the Data

Let's dig into some of the numbers. Over the last 30 days, we've added 6,813 single-family listings to the inventory in the state of Massachusetts. It’s still a really healthy market overall. One of the areas where we would tend to see the biggest impact of the interest rate changes is in the number of listings that went under agreement. In April of 2022, 5,829 single-family homes went under agreement it's down slightly from 6,500 that went under agreement in April of 2021. We feel that is attributed to the lack of inventory coming on the market which is still lagging behind where it was in 2021, 2020, and 2019.

 


All signs still point to multiple offers, over asking bids, and a really strong housing market. One of the biggest indications of this can be found by looking at what happened to the average price of closed homes on May 1, 2021, versus May 1, 2022. That
average price climbed from $625,000 on May 1, 2021, to $689,000 on May 1, 2022. 

 

Experts believe that home prices will continue to grow through 2026, although not to the extreme that we’ve seen over the past year or so. The graph below from Keeping Current Matters depicts expert predictions for the next few years. 

 

 

What Does This Mean for You?

Buyers are still out there looking for homes and even though interest rates are increasing, they're still putting in really strong offers. Now, one of the questions that you might be wondering is what is this going to mean for the future. We don't know for sure, however, we believe that we're going to head into all of May, June, and July with what is still a very strong housing market for both buyers and sellers. However, buyers might find that there's going to be some room for opportunity as homes are staying on the market slightly longer. Keep in mind that by slightly longer, we mean more than seven days which is kind of crazy to think about! However, when that starts to happen we might see that the percentage above asking where homes are selling is going to start to decrease a little bit. For sellers, there is still amazing opportunity to cash in on your built-up equity with phenomenal appreciation rates year over year. Demand is still there and you’re still in a position to get a fantastic offer for your home. 

Bottom Line?

If you have any questions about how the housing stats might impact your decision to buy sell or invest reach out to us! We’d be happy to dive into this in greater detail and take a closer look at your unique situation so we can help you determine the next right steps for you!

May 9, 2022

Living in Westford

 

 

Location

Westford is a suburban community of approximately 24,000 residents located near the intersection of Route 3 and Interstate 495. It is a popular area with home buyers largely due to its convenient location for commuters (with easy access to major highways) and strong school system. The LRTA 15 bus connects Westford along Route 110 with Chelmsford and Lowell train station on the MBTA Commuter Lowell Line. 

Other major routes passing through the town are MA Routes 110, 40 224, and 27. 

 

 

Community

Westford has plenty of shopping Cornerstone Square Plaza is which is home to Market Basket, Marshalls/Home Goods, Petco, and a variety of other stores and restaurants. Whole Foods, CVS, and more are across the street.

 

Westford is also home to the Roudenbush, a non-profit Community Center that offers a wide range of activities for individuals and families in the area. Offerings include both part-day and full-day childcare, toddler programs, as well as teen and adult educational programs. They also offer summer programs so that your kids can enjoy fun-filled activities all summer long. The J V Fletcher Library is located on Main St near the town green. In addition to a large collection of books and audio/video material, they also offer many community programs. The weekly kids programming is known around the area and attracts residents from many surrounding communities.

 

During the warmer months, you can enjoy a day out with the family at Kimball Farm. Here you can enjoy 50 flavors of homemade ice cream, an outdoor grill & seafood shack, 50 acres of fun activities, and a cozy country store and cafe. From bumper boats to ziplining, to arcade games, this is a great spot for family fun!

 

Westford also boasts two public beaches Forge Pond and Edwards Beach. Forge Pond is located near Forge Village Center and can be reached by the access road that runs between Bradford Street and the railroad tracks, both off of Rt. 225. Edwards Beach at Nabnasset Lake is located at the end of Williams Avenue off of Plain Road. Westford residents get in for free but must have proof of residency. Nonresidents pay $5 per person, per day. 

 

The Westford Farmers Market hosts a variety of local farmers and vendors on the Westford Town Green on Tuesday afternoons from June through October. The Farmer’s Market is always buzzing with activity. Local farmers sell fresh produce, meats, honey, eggs, and other farm-fresh products. Other small businesses in the area sell baked goods and crafts. There are usually kid's activities available to keep the little ones occupied while parents shop.

 

Throughout the year there are many community-based events designed to bring the town together. The Apple Blossom Parade and Carnival, both sponsored by the Kiwanis, are always a highlight of the spring. The Friends of East Boston Camps host seasonal gatherings at the Stonybrook Conservation Area which they have worked to restore. There is also an annual 5K Road Race and other events as well.

For history buffs, be sure to check out the “Westford Knight.” This is the name given to a pattern carved into a rock that was first mentioned in print in an 1873 edition of the “gazetteer of Massachusetts.” This carving is the subject of popular or pseudohistorical speculation on Pre-Columbian trans-oceanic contact. 

 

Restaurants

Looking for some great spots to buy a bite to eat? Here are some of our favorites in the area:

Karma 

Evviva Trattoria

Diggy’s

Paul’s Diner

Fuse Westford

Seoul Kitchen
Westford House of Pizza

Marios

Schools

Westford is home to 10 schools including a preschool, 3 K-2 schools, 3 3-5 schools, 2 middle schools, and 1 high school. More information about school rankings can be found on Niche.com. Westford is also home to Nashoba Valley Technical High School, a four-year career-focused high school serving Westford and 13 other surrounding communities.

 

Below are links to the web pages for each of the public schools in Westford:

 

Final Fun Fact

Paul Revere’s son attended Westford Academy and a bell cast by Revere graces its lobby today. A weather vane made by Paul revere sits atop the Abbot Elementary school.

Posted in Living In Series
May 5, 2022

4 Things That Can Help You Stand Out In a Bidding War

 

Bottom Line

  • One key factor in submitting the strongest possible offer is having a solid understanding of your budget. By doing so, you'll feel confident in submitting an attractive offer that's still within your means.
  • Showing the seller that you are a serious buyer is an important factor in making your offer stand out. By offering a larger earnest money deposit or a higher down payment, you'll be able to signal to the seller that you may be less of a risk than the other buyers your competition against.
  • At the end of the day, there are other ways to make your offer stand out apart from offering more money. Your trusted agent will be able to gather insight into what is most important to the seller and offer up their expertise on what sellers in the area tend to look for outside of financials.

 

Posted in Infographic
May 2, 2022

The Benefits of Downsizing

 

 

Deciding to make a move often comes at a major life milestone moment. This could be your family expanding, a new work opportunity, the kids moving off to college, or retirement. The decision to move can also come from a realization that your current space doesn’t align with your lifestyle goals. Maybe you have come to the conclusion that you’d like to simplify your life and have the ability to spend your time and money on things outside of maintaining your home.

If you’re looking for ways to spend more time focusing on what is important in your life and are looking for ways to fund this new venture, downsizing might be the right move for you. Today we’re reviewing all of the reasons why less may be more when it comes to your home size. 

 

A Home That Fits Your Current Needs

When it comes to home sales, baby boomers make up the largest share of sellers at 42% according to the 2022 Home Buyers and Sellers Generational Trends report from the National Association of Realtors (NAR). Additionally, buyers 56 years and younger were more likely to purchase bigger and more expensive homes, while buyers 57 and older were more likely to downsize in both size and price. According to the report, the driving forces for those over the age of 55 to purchase a home include the desire to be closer to friends and family, the desire for a smaller home, and retirement.

It’s important to keep in mind, however, that downsizing is not restricted to those who are empty-nesters or those who have retired or are soon to be retired. Downsizing can appeal to any looking to simplify their life, free up their time, and save money.

 

If you're in either of these scenarios, you may find that your priorities are shifting and you want to focus more on doing what makes you happy. This could mean a move that puts you closer to loved ones or one that provides you with easier access to the hobbies that you enjoy. Additionally, downsizing could allow you to spend less time and money on maintaining your home, and free up more funds to spend on those higher priority items. 

 

Downsizing can also leave you with more hours in your day! With increased cash flow, fewer utility costs, and less house to maintain, downsizing can also free up your schedule and allow you to put more time and energy into the important aspects of your life outside of the home. Whether that’s being able to travel with family or spending more time enjoying moments spent with loved ones, downsizing may provide you with the financial freedom to spend your days doing exactly what you enjoy doing. 

 

The Impact of Equity

One of the major benefits of downsizing in today’s market is capitalizing on the built-up equity you’ve acquired over the years. According to the latest Homeowner Equity Insights report from CoreLogic, the average homeowner gained about $55k in equity over the past 12 months. This means that if you’re looking to downsize, that additional wealth will allow you to place a larger downpayment on your new home. This will result in smaller monthly mortgage payments, which will allow you to have more money to spend on the things that you are passionate about. Additionally, having a large downpayment can help you stand out in today’s competitive market. 

Taking advantage of the equity you’ve built up today can help you attain the home of your dreams tomorrow, and further allow you to focus on your priorities in life.

Bottom Line

If you are experiencing a major milestone in life or are looking for ways to cut back and simplify, you may be thinking that now is the time to downsize and spend your time and money on priorities outside of the home. With the equity that you have built over the years, downsizing today will allow you to align your home with your need. Make your move today to downsize your home to upgrade your life.

April 21, 2022

Why We Are Not In A Housing Bubble

 

 

We frequently hear folks compare the market today to that of what we saw in the mid-2000s when home prices crashed and millions of Americans lost their homes. In fact, in a previous survey done by Redfin, 77% of participants in the US housing market believe that there is a bubble. 

 

The reason? At a glance, many of the factors that contributed to the previous crash appear to be happening today. After all, home prices are continuing to climb and the level of appreciation we’ve seen over the past year feels unsustainable.

 

We've indeed seen an unprecedented increase in appreciation. However, the important thing to keep in mind is that the factors behind the increase in prices are completely different from what we saw in the 2006 housing market. 

 

In this article, we’ll be taking a closer look at the key reasons why we are not in a housing bubble and waiting for a crash might not yield the results that buyers are hoping for. 

 

Reasons Why We’re Not Due For A Crash

There Aren’t Enough Homes

One of the main differences between the housing market in 2006 and what we’re seeing today is the lack of available inventory. UBS strategists Solita Marcelli and Jonathan Woloshin explain, “Existing home months-of-supply - the number of months it would take for the current inventory of homes on the market to sell given the current pace of sales - is near all-time lows across the US. In the case of new homes, supply chain and labor disruptions have increased the cycle to complete homes.” 

 

According to a survey conducted by Discover Home Loans, 79% of homeowners would rather renovate their homes than move. While home prices are continuing to climb, many sellers are hesitant to jump due to the idea of having to buy in such a competitive market. 

 

Another factor to consider is the sheer demand that we’re facing today. Part of that reason is that millennials are entering their prime homebuying years. Additionally, the pandemic has also made remote and hybrid work a reality. This opens up the options of where you can live and releases workers from being bound to an office location. Therefore, there are more opportunities to find that perfect home without being tied to set locations. For many, remote work allowed them to purchase a home in the place they’ve always dreamed of, further adding fuel to the overwhelming demand we’ve been seeing. 

 

Less-Risky Buying Behavior

According to Marcelli and Woloshin, around 40% of mortgages in 2006 were adjustable-rate, compared to around 1% today. Adjustable-rate mortgage payments move higher and lower depending on the macroeconomic environment. What this means is that payments have the potential to rise in a substantial enough way to a point where individuals may no longer be able to afford them. This is not the case with fixed-rate mortgages, where the rate stays the same throughout the mortgage. This is what we typically would see for mortgages in today’s market. 

 

The number of people using an adjustable-rate mortgage was one of the driving factors behind the large number of foreclosures that occurred during the previous housing market crash. 

 

Tighter Lending Standards

One of the major differences between what we saw in the mid-2000s and what we’re seeing today is that the credit standards are much tighter. This means that it’s much more difficult to borrow money today than it was a decade ago. 

 

The problem that we saw 15 years ago was that many purchases were not truly qualified for the mortgage they obtained. Banks were creating artificial demand by lowering credit standards and making it easy for anyone to attain a loan or refinance their home. 

 

This gap in lending standards is depicted in the Mortgage Bankers Association’s Mortgage Credit Availability Index. Below you can see where credit standards stood at the time of the previous housing crash and where they stand today.

 

 

 

Available Equity

In the early 2000s, one strategy that many individuals used to combat rising prices was to borrow against the equity in their homes to finance new cars, boats, and even vacations. However, when prices started to decline, many of those same homeowners ended up underwater, leading them to abandon their homes and increase the number of foreclosures. 

 

Today, we are seeing a different picture. Black Knight reports that the equity available for homeowners to access has more than doubled compared to what we saw in 2006. ATTOM Data Services also revealed that 41.9% of all mortgaged homes have at least 50% in equity. This means that these homeowners will not face the dire situation that we saw in the past if prices dip slightly. 

 

Today we can have confidence knowing even if prices were to drop, we are not going to face a situation where homeowners are forced into foreclosure situations due to the sheer amount of equity that has been built up over the years.

 

What Should Homebuyers Do In This Market
Chief economist at the National Association of Home Builders explains, “I think you want to be strategic and you want to be patient. Patience is different from waiting for a crash.” When you look at the data, it’s going to be a while before inventory matches up with demand. Experts surveyed by Zillow predict that it will be at least two years before monthly inventory returns to pre-pandemic norms. 

 

But what about interest rates? Won’t the rise in rates deter buyers? Isn’t the combination of interest rates with inflation at 41-year highs going to sink the market? Marcelli and Woloshin say that rising mortgage rates will cool the pace of price appreciation, but home prices aren’t due for a significant drop. This could make life a little bit easier for buyers as the competition is likely to die down and bidding wars should cool off. 

 

If you’re looking to buy, waiting for a crash might not be the best strategy. Instead, be patient and strategic. Rates are still fairly low when you compare them to previous decades and you can still secure a great rate by acting today. To help you find that perfect home, broaden your horizons and weigh in different options, whether that’s a longer commute if you’re only going into an office a few times a week thanks to a hybrid schedule, or looking at new construction if you hadn’t already thought about it.  

 

What Should Homebuyers Do In This Market

While there are factors that point to a slow appreciation and relaxation of demand, waiting for a crash may not be your best bet when it comes to buying a home. While at a glance we might be in a bubble, the fundamentals are there and the reasoning for the steep appreciation we’ve seen over the past couple of years is sound. Instead of waiting for a crash that may not happen, take advantage of slowing competition and get creative with your search. There is an opportunity out there and a knowledgeable agent will be able to help you take advantage of the current market conditions. 

April 18, 2022

Living In Chelmsford

 

 

Location

Chelmsford is a town in Middlesex County, Massachusetts. It’s located 24 miles northwest of Boston and is surrounded by Lowell, Tyngsborough, Billerica, Carlisle, and Westford. It is a scenic community with easy access and proximity to the city of Boston, the Atlantic coastline, and the White Mountains of New Hampshire. Chelmsford is a great location for anyone needing to commute as it is located at the intersection of 495 and Route 3. Also found in Chelmsford are state routes 3A, 4, 27, 110, and 129. Another perk is the convenient access to the MBTA Lowell Commuter Rail Line through bus service to Lowell Station.

 

 

Chelmsford is divided by zip code into Chelmsford (01824) and North Chelmsford (01863). The northern parts of Chelmsford tend to be more urban and densely populated and the southern sections tend to be more rural.

Community

Chelmsford boasts many shops and restaurants. In Drum Hill, you’ll find Walmart, Hannaford Supermarket, Panera Bread, Dunkin, Starbucks, Chipotle, and more. You’ll also find Best Fitness Drum Hill and Orangetheory Fitness if you’re looking for your next gym location. Down the road in Chelmsford Town Center, you’ll find a CVS, the Chelmsford Public Library, Choice Fitness, and many more local shops and restaurants. 

Speaking of the Chelmsford Public Library, this is a fantastic feature of the town of Chelmsford! Here you can get museum passes for a fun day out with the family and enjoy several activities for both adults and children. Be sure to check out the library events calendar to see all that this wonderful location has to offer!

Chelmsford has plenty of town events throughout the year. You can enjoy the Famer’s Market on the Town Common on Saturday from 10:00 am - 2:00 pm, mid-June through mid-September. On Independence Day, you can enjoy a parade said to be the best in the region and a Country Fair hosted by the Chelmsford Lions Club! In the winter, kick off the holidays with The Annual Holiday Prelude and Tree Lighting Ceremony. Be sure to stay up to date with the town events page for more information and additional events. 

If you’re looking for ways to enjoy the outdoors, you’ll love the Bruce Freeman Rail Trail. This trail stretches through the communities of Lowell, Chelmsford, Westford, Carlisle, Acton, Concord, Sudbury, and Framingham and follows the 25-mile route of the old New Haven Railroad Framingham & Lowell line. The trail features 10-foot wide pavement with a 2-foot wide packed shoulder on each side. This trail can be used for cycling, jogging, walking, rollerblading, and skiing in the winter months! Other parks to visit include Roberts Field, which boasts a recently redone (2018) universal, inclusive, and accessible playground, a certified wildlife habitat (Pollinator Park), and walking trails totaling 1 mile around the pond and through its wetland and forested areas. In 2021, additional improvements were implemented including adding two youth-sized baseball fields with a dugout, a multi-use soccer/lacrosse field, a ⅓ mile crushed stone walking track, and a four-station exercise circuit. These improvements open on Memorial Day 2022. Another spot for you to enjoy is the Russell Mill Pond and Town Forest. The forest contains an extensive trail network, ideal for any mountain bike enthusiast.

 

Finally, as far as food options go, you’re going to have many options to choose from. Here are some of the top-rated restaurants in Chelmsford for you to try!

  1. Fishbones
  2. Moonstones
  3. Feng Shui
  4. Nobo Japanese Restaurant
  5. Tequila’s Mexican Grill & Cantina
  6. Pita

Schools

Chelmsford is home to 7 public schools, including 4 for grades K-4, 2 Middle Schools, and 1 High School. Students are assigned to schools based on geography for elementary and middle schools. More information on Chelmsford Public Schools can be found on niche.com.

Below are links to the web pages for each of the public schools in Chelmsford:

  1. Byam Elementary School 
  2. Center Elementary 
  3. South Row Elementary 
  4. Harrington Elementary School 
  5. Parker Middle School 
  6. McCarthy Middle School 
  7. Chelmsford High School

Final Fun Fact

We know that everyone loves a fun fact! Here's something you might not know about Chelmsford. Chelmsford was the birthplace of the Chelmsford Spring Co. in 1901, which later became the Chelmsford Ginger Ale Company, acquired by Canada Dry in 1928. The ginger ale plant, rebuilt in 1912 after a disastrous fire consumed the original plant, stood on Route 110 until its demolition in 1994. The Chelmsford brand of golden ginger ale continued to be manufactured by Canada Dry for decades. It is currently manufactured by Polar Beverages for DeMoulas/Market Basket supermarkets, based out of neighboring Tewksbury.

 

Posted in Living In Series