Spring Market Report
It may not feel like it, but it is finally Spring. The real estate market as a whole has been on the uptick for a couple years now and 2018 is continuing the upward trend. On average, homes are selling with a higher median listing price and fewer days-on-market according to a recent Forbes article. These positive trends are favoring both investors and sellers. 2018 is on track to be a profitable year for investors all over the country.
Winter is the New Spring
Experts are finding 2018 to be a good year for investors for an unusual reason. As quoted in the article mentioned above, Javier Vivas, Director of Economic Research at realtor.com, says that Winter, rather than Spring, was the beginning of the 2018 buying season. Buyers seem to have started purchasing back in January. This has made it easier for investors who bought and renovated properties in the early winter months to sell their properties as soon as they are renovated. With more profits than expected so early in the year, investors are happy.
- Median prices are up 8%
- Days-on-market are down 7%
- Inventory is down 8%
Source: Paris, Ellen, 2018’s Housing Market Is off and Running: What You Need To Know
The early indication is that at least the first two statistics will continue through the Spring and Summer.
What Does This Mean for Real Estate Investors?
You can plan on making more money on your sale, per the median prices. By spending less money on interest and holding costs, per the days on the market, you’ll see better profits. The demand for your property after renovation will be much higher, due to low inventory (described as “a shortage of historical proportions”). All roads thus far in 2018 lead to profits for investors with buyers delving deeper into their pockets.
The same advantages create some disadvantages for REI, though. While you enjoy an advantageous position on the selling end, you’ll most likely find it difficult making successful bids on distressed properties. You will find yourself as the buyer in a seller’s market, so it may be wise to reinvest the money you are saving into the bidding/marketing side of your business. JD Esajian of Fortune Builders and star of a popular flipping houses reality show, recognizes the challenges investors face in the Spring season. He backs our reinvestment strategy saying, “While Spring can be very advantageous for investors, it can also be challenging due to an increase in competition. Investors should prepare for this swell by ramping up their marketing strategies.”
Why Reinvest in Marketing? . . . To Get Better Offers!
When it comes to marketing, it is important to make sure that your techniques are consistent across all platforms and that you start with a solid foundation (Esajian, JD, Amp Up Your Marketing To Prepare For Spring Selling Season). The platforms he references are networking, advertising, tracking your results, and building a strong team. Of course, these forms of marketing are always important, but when the Spring market rolls around and negotiations become increasingly competitive, your marketing could be the difference for you. If the housing market stays as hot as it is, expect to be in many intense and competitive bidding wars on the front end with investors who know all the same information you do.
We at RFG hope this gives you some insight into the Spring market and would like to wish all the investors good luck this season and throughout the year to come.
Ready to get in on 2018’s upward momentum?