Home prices haven’t risen this fast since 2005

Home prices accelerated yet again in March, for the 10th straight time. In fact, they rose 13.2% from March 2020, according to the most recent S&P CoreLogic Case-Shiller Home Price Index report.

The March gain is also the largest since December 2005 and is one of the largest in the index’s 30-year history, said Craig Lazzara, managing director and global head of index investment strategy at S&P DJI.

The 10-city composite rose 12.8% year over year, up from 11.7% in the previous month. The 20-city composite increased 13.3%, up from 12% in February. Cities with the strongest home price gains were Phoenix, San Diego and Seattle — similar to last month’s Case-Shiller report.

Phoenix saw a 20% year-over-year home price increase, followed by San Diego with a 19.1% increase and Seattle with a 18.3%.

“Home price data is consistent with the hypothesis that COVID-19 has encouraged potential buyers to move from urban apartments to suburban homes,” Lazzara said. “This demand may represent buyers who accelerated purchases that would have happened anyway over the next several years. Alternatively, there may have been a secular change in preferences, leading to a permanent shift in the demand curve for housing.”

Higher material costs, a lack of inventory and labor continue to drive demand, pushing up home prices. Robert Frick, corporate economist at Navy Federal Credit Union, noted that some builders are slowing production in hopes prices will come down as the supply chain recovers.

“The housing market dynamics are pushing up prices of homes to the point that new homes especially are increasingly out of reach for lower-income and even many middle-income Americans,” Frick said. “And unfortunately, a slowdown in starts and permits shows the new home supply, while much higher than pre-pandemic levels, will not be increasing soon.”

In response to the latest Case-Shiller report, Zillow chief economist Matthew Speakman noted that 683,000 new homes were sold in all of 2019 — and the current pace of sales is “well on track” to exceed that figure this year, despite a lack of inventory and unprecedented home prices.

“Homes are selling about as quickly as ever, and many builders are expressing the fact that sales could be higher if materials-related constraints weren’t there,” Speakman said. “With so few existing homes available for-sale, would-be buyers continue to eagerly seek out newly constructed homes, even as prices rise.”

Mortgage rates continue to hover around 3%, keeping prospective homebuyers interested, Speakman said.

“Mortgage rates have held near all-time lows and the gradual re-opening of the economy has encouraged many would-be buyers to enter the mix,” Speakman said. “All told, there is little, if any, indication that home prices will slow their appreciation anytime soon.”

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6 Signs the Seller Cut Corners When Flipping a House

It was love at first sight…those matte black finishes and quartz countertops.

And the floors! Light gray oak, slightly weathered. This reno has every hallmark of your dream home…so how can you be sure, beyond the inspection, that what’s behind the walls is every bit as pristine as the new paint and appliances? Or that, in three months, things won’t start falling apart? Just because a house looks totally new doesn’t mean that is, which is why we turned to the pros to uncover what warning signs they look for, so you can avoid major headaches down the road.

1. THE EXHAUST FANS ARE JUST FOR SHOW

When you check out the bathroom, pay close attention to the exhaust fans. Do they exist, and if so, can you turn them on? Bathroom exhausts that aren’t properly vented—or nonfunctioning and “abandoned” in the ceiling, so it looks like an exhaust is there, but it’s really not doing anything—are a red flag.

“This is a very common occurrence. Abandoning things in the attic is often an ‘out of sight, out of mind’ mentality,” explains Michael Humphrey, Sterling Properties founder and Wealth Secrets of Real Estate author. If the seller didn’t bother to have them replaced, it makes you wonder: What other areas did they not really care to fix?

In terms of the exhaust itself, your inspector can make sure it’s the right size and is functioning properly, but it’s something to have on your list and double check when you receive your inspection report.

2. THE BATHTUB HAS BEEN REGLAZED

There’s nothing wrong with reglazing a bathtub; it’s an affordable way to make it look brand new. But it also means that it’s hard to tell exactly how old—or beat up—it was before it was recoated. “You might use it for six months to a year, then the tub starts cracking or falling apart, and you’re left with a $3,000 or $4,000 bill to replace it,” says Christian Fuentes, broker and owner of RE/MAX Top Producers in Diamond Bar, CA. “If you see that, get in the tub and step on it—if it feels soft or moves around too much, especially if it’s an old fiberglass tub, know that you’re probably going to have to replace it soon.”

3. THE FLOORING IN EVERY ROOM IS A DIFFERENT HEIGHT

If you notice that the floors seem to be at different heights throughout the house, take a closer look. Often, it means new floors were simply laid over old ones, instead of having the old ones removed and professionally replaced, explains Alison Malkin, head broker and owner of RE/MAX Essentia in Avon, CT. It makes you wonder: If the seller didn’t care about installing the floors properly, what other—more labor-intensive and big-ticket—projects were neglected as well?

4. THE OUTLETS HAVE BEEN UPDATED, BUT NOT THE WIRING

Upgrading all of the electrical work in an older house can be very costly, which is why some investors may upgrade the outlets—say, from two prongs to three-pronged ones—without doing anything else. “You see nice, clean plugs and outlets, but they’re not grounded,” Fuentes says, which means a power surge could destroy your electronics and damage your home.

It’s another reason to hire an inspector, and if you feel like things need a closer look, call in an electrician. “As a first-time buyer, don’t be afraid to bring in a plumber, electrician or foundation specialist to give you more details; sometimes inspector’s reports can be very vague,” he adds. “You’re making a huge investment, so it’s worth a closer look.”

5. THE PAINT HAS AN “INTERESTING” TEXTURE IN ONE SPOT

Every expert we talked to cautioned about the wonders of a fresh coat of paint. “Paint can cover up a lot of issues, but eventually, those issues will come out,” Fuentes says. Issues like water damage, mold and rot, just to name a few. He suggests checking the disclosure agreement the seller sends you when you go into contract to see if the house has been painted recently. If it has, inspect it up close: “If you see any bubbles, stains, shadows or texture coming through, there’s probably something there,” he says. “Feel around that spot—if it doesn’t feel right, something’s there.”

6. THERE’S A DAMP SMELL

“If you ever smell anything funny, like a moisture smell, be careful, because there’s probably some kind of water damage in the house,” Fuentes says. While touring the home, open the cabinets and check under and around the sinks in the bathrooms and kitchen for bubbling or signs of damage. If the inside of a cabinet has been freshly painted, it may be worth finding out why.

Sometimes, though, mold can be lurking in areas an inspector wouldn’t find—and the seller may be totally unaware of—citing a recent case of a buyer who went to remodel the kitchen of the house she just bought, only to rip out the cabinets and tile, uncovering black mold everywhere.

If there’s a damp feeling to the air, it can be worthwhile to call in a mold inspector. “They can test the air and see if there are signs of particles and test the moisture levels in the house,” Fuentes says. “It might cost you an extra $500 to $600, but it could be worth it, especially if you have asthma or allergies.”

For more tips like this, visit PureWow.

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• Should I Move or Refinance?

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  If there is a home that you would like more information about, if you are considering selling a property, or if you have questions about the housing market in your neighborhood, please reach out. We’re here to help.

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As Featured in West + Main Magazine: Jana's Attic Conversion

Instead of expanding her home's footprint, Jana opened up her foyer and went UP...adding valuable square footage in the unfinished attic!

-Jana Busey

As much as I love that arched pink door (It's a serious conversation starter whenever anyone comes to my home!) my favorite thing about this renovation is all of the much-needed new living space. I added a bedroom, a full bathroom, and a large bonus room in what was a dark, unused attic space. 

The stairway is also a total show-stopper, and there is no question that if I ever decide to sell my home, the extra square footage and thoughtful layout and finishes will definitely give me a great return on my investment!  

FIND THE ENTIRE PROJECT AT: westandmain.co/pinkdoor

For more remodel inspiration, checkout the first two editions of our magazine here.

5 Things You Should Never Do at the Farmers Market

Shopping at farmers markets is one of the best ways to buy goods directly from farmers and local producers.

When you shop at a farmers market, there is no second-guessing if what you’re buying is in season, because what’s available to purchase is what’s growing in the fields at this very moment. But there is an art to shopping at them.

I used to manage famers markets, a few different-sized ones in various cities, and during those years, I noticed plenty of mistakes that shoppers make. It didn’t matter whether the shoppers in question were first-timers or regulars either — pretty much everyone is guilty of committing at least one farmers market foul.

There are the biggest mistakes I saw people make — and the ones you should avoid making in the future!

Don’t skip an initial lap.

It may be easy to stop at the first stall that catches your eye and load up on all the delicious fare they have on display. I don’t blame you, but this will lead to inevitable disappointment when you’ve spent most of your cash and your bags are full to the brim before you’ve gotten to assess all the other goodies available. I find that the best shopping strategy is to see what’s available, compare prices, and make a mental checklist of what you want to purchase. For example: Don’t miss out on out-of-this-world baked goods, honey, jams, dips, sauces, and even fresh-cut flowers!

Don’t negotiate with vendors.

This is a big, all-around no. Do you haggle for a better price at your grocery store? No? That’s what I thought. Each stall functions as its own small store — without the brick and mortar. In this casual environment, shoppers might feel more comfortable asking for a deal, but the prices you see are reflective of the true cost of growing the food you eat — labor included. Take note that some vendors do offer discounts or deals at the very end of the market; just wait until the deals are on vendors’ terms.

Don’t avoid stalls just because they don’t have “Certified Organic” produce.

I’ve witnessed many customers walk right past stalls that don’t sell “Certified Organic” produce. The issue with this is that most people aren’t aware of the intricacies and obstacles in place for small-time farmers. Many farmers do have sustainable practices but aren’t legally allowed to use the word “organic” per the USDA, unless they pay a large fee for official certification (which can take around three years to obtain). If you see signs at a stall that say, “No spray” “No chemicals,” or “No pesticides,” this is the farmer’s way of saying, “We grow organically!”

Don’t shop without asking questions.

One of the best ways to learn about how your food is grown is to talk with the very people who grow it! If you’re curious about the farm, unfamiliar with a particular offering, or wondering when a certain vegetable will make it to market, don’t be afraid to ask. Take time to get to know the people who make your food. Most farmers I’ve encountered enjoy talking about what they do for a living and love curious customers.

Don’t show up without cash.

Although credit and debit cards are super convenient, cash still rules at the farmers market. Many farmers and vendors are unable to accept cards, so the only way you’ll get delicious asparagus in spring or beautiful, green zebra tomatoes in summer is by having plenty of cash in your wallet. Bring smaller bills, too.

This post originally ran on Kitchn. See it there: 5 Things You Should Never Do at the Farmers Market, According to a Former Market Manager

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Carving Out This Much Spare Extra Square Footage Can Up Your Home’s Value by 23%

Location, finishes, school zones, acreage—these are all factors that determine a home’s value.

Another important one? Square footage, particularly “livable” square footage. Adding a small sunroom off the kitchen or a whole separate level can pay off big-time. In the United Kingdom, Build4Less found that double-story extensions (extending the size of your living space on two floors) can bump up a property’s value by 23 percent. The magic number: around 430 square feet. 

But you don’t just have to go up and out. There are plenty of places where you can find that amount of space without doing major construction. You just have to look in the right places.

Convert the Garage

If you don’t rely on your garage to park your car, consider a cozy entertaining zone (utilizing this space can up your value 13 percent), like the one photographer Veronica Grimm created that’s complete with a fireplace and cocktail-making station. An attached garage offers even more possibilities. Shirley Slee turned one into a bright and airy kitchen on a $50,000 budget—forklift included. 

Finish the Basement 

Your basement can be so much more than just a place you store old furniture (taking advantage of the space can increase your home’s value by 18 percent). For a truly family-friendly spot, cover the cold concrete floor in vinyl wood planks, add some wainscoting and dark paint to the walls, and turn a soffit nook into a gaming zone. 

Look Up

A loft conversion (or making something out of the attic) has the potential to get you 20 percent more for your home when you sell. Once you get approval from your builder (to make sure that adding weight to the house won’t affect the foundation), consider a guest room–slash–playroom that serves double duty for families or a functional office.

Get more tips like these on Domino.

Related Links

• Should I Move or Refinance?

• 10 Tips for Small-Space Furniture

• These were March’s hottest housing markets

If there is a home that you would like more information about, if you are considering selling a property, or if you have questions about the housing market in your neighborhood, please reach out. We’re here to help.

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