Property values have been on the rise throughout the nation as availability continues to become more limited. The combination from both a slowdown of overall residential property development along with the influx of younger buyers entering the market has pushed home values to all-time highs in many locations across the nation. It seems no area is outside the impact of these trends where the market is showing increases in property values all the way up to 10% growth in just under a year in both top metro and suburban areas.
Specifically, in Texas where the last five years has seen great deals of high volume increases in both residential and commercial, new findings are showing property values have increased on average 8-10% from 2018. This includes more affluent areas like that of Plano where an increase of property values rose $2.5 billion in taxable values.
With this information, residential areas like those noted in Texas are still being considered sellers markets. This means property buyers are likely paying a premium when purchasing their home in what is still being considered the height of market increases. Due to these trends many residents are turning to alternatives that will push off home buying until prices level out, whether that be later this year, next year or in the unforeseeable future
Both newer home buyers and those who have already made their first home purchase are among those looking to push off their property investment until the increases subside. One key focus for these populations is the opportunities presented through the renting community. Just less than two decades ago renting was not a readily available solution for most of the nation, whereas now with a rush of development and new market categories, rental living can offer the same accommodations and fulfill the same requirements as those living in their own home. This alone has helped many find rental options and has in turn reduced some of the competition home buyers face while also saving many from paying inflated home prices.
Along with flexible commitments and more personalized accommodations, another main driver bringing even former homeowners to the rental market is its affordability. This contradicts much of historical housing trends that focus in on home ownership as being the best investment. As today’s analysts look at some of the nation’s most populated counties including those areas mentioned in Texas, limited availability, high mortgage rates and stiff competition are pricing many would be buyers out of the market or putting those that stay in it in debt.
Renting today may even mean long term benefits for those seeking residence in popular areas as the going market rate for the same house just 5, even 3 years ago has gone up substantially. “Choosing rental alternatives allows residents to be located in the areas they are after so they can take advantage of local opportunities, community amenities, etc. while avoiding heightened debt. The goal for most would be to stay renting in the area they want to eventually live in until property values are back to their appropriate rates.” shares Texas-based rental property titan Marcus Hiles.
The facts and historical data show the housing upswing shouldn’t be expected to continue on for good. As many veterans and analysts in the industry have seen throughout past decades, housing markets once inflated will soon meet their cap – and cause an inevitable downturn.
“These are just some of the reasons why renting is becoming a more popular option in key areas throughout Texas. Along with the impacts of property development limitations and a more diversified group of decision makers from younger demographics; home ownership is not always the most reliable investment it was thought to be with past generations.” share Marcus Hiles.