Thanksgiving is a time to reflect on the healthy home market.
Lane Hornung traditionally uses this Q&A as a time to reflect on the housing market.
Homeowners and even home buyers, have plenty to be thankful for this Thanksgiving.
If you were looking to buy a home this autumn, you certainly haven’t been discouraged by the weather during most of the fall.
And as you prepare to sit down for the Thanksgiving meal, the mostly warm weather is just one of the many things you can be thankful for in terms of the housing market.
Indeed, as you carve the bird and pass the plates, you can be thankful that the home you are sitting in is most likely worth thousands of dollars more now than last Thanksgiving.
In addition to turkey, mashed potatoes and pumpkin pie, another tradition in recent years has been for Lane Hornung, CEO of 8z Real Estate, to discuss what we can be thankful for in his monthly Q&A session with John Rebchook, of Denver Real Estate Watch.
John: Certainly, homeowners in areas like Denver and the Bay Area of Northern California have a lot to be thankful for.
Lane: No two ways about it. Home owners have enjoyed some really nice appreciation. When the inflation rate is less than 2 percent and home prices are rising at or close to double digits, that is genuine appreciation. Even if prices started to rise by “only” 4 percent to 6 percent, I think we all would be thankful for that.
John: Of course, someone trying to buy a home in such a fast-appreciating market might not be thankful that prices have risen so fast.
Lane: It is challenging. But buyers can be thankful that interest rates are still incredibly low. Low interest rates help offset some of the sting of rising prices.
John: Not everybody thought the home market would continue on this appreciation path. One line of thought was that prices must come back down, after rising for so many years.
Lane: One of the things I think that people can be thankful for is that the rising market did not become a bubble market. We never re-visited the downturn of a few years ago.
John: It also seems that the much-talked about Millennials must be thankful when they have been able to trade record-high rents for the benefit of homeownership.
Lane: First-time home buyers are definitely qualifying for loans and buying homes, starting down that road of prosperity. Despite people saying that Millennials don’t want to be homeowners, we are seeing more young professionals contacting us every day. Believe me, they are thankful for being able to start building equity.
John: Home builders also are doing their part to bring more homes to the market.
Lane: Yes, I’m thankful that builders are building more homes. I do wish they were building them a bit faster, as we still could really use the supply.
John: In addition to interest rates, appreciation and builders, what are you thankful for.
Lane: I’m thankful that the homeownership rate in this country appears to have hit bottom. I think it has hit its low point and will slowly start to rise from here. I’m also thankful that the median U.S. household income rose 5.2 percent, the most since the Census Bureau began tracking that statistic.
John: How about in Colorado, specifically?
Lane: I’m thankful that Colorado continues to attract a lot of sharp, entrepreneurial people. And I’m thankful a tough year in the oil and gas industry didn’t spread to the broader economy and cause the economy to burst like it did in the 1980s. Thankfully, our economy is diversified enough to withstand a downturn in one sector.
John: What are you thankful for on a personal level?
Lane: I’m thankful that I work with a great bunch of professionals at 8z. I’m thankful that they have helped thousands of people buy and sell homes this year.