KC Buyers: Get Ready for Smaller, More Affordable Homes
Are you in the process of looking for a home, but increased mortgage rates and home prices are restricting your options? If this is the case, there’s good news! Ali Wolf, Chief Economist at Zonda, says you can expect smaller, more affordable homes in the near future:
“Buyers should expect that over the next 12 to 24 months, there will be a notable increase in the number of entry-level homes available.”
In some ways, smaller homes are already here. For many, the pandemic changed the meaning of home. The home no longer needed to serve only as a place to live but also as a place of employment, education, exercise, and more. Those with this space were more likely to hold onto it, and those who didn’t were in a position to sell and expand to a larger home. During the pandemic, homes coming to the Kansas City housing market were smaller than before – and we see this trend continuing in the current market (see graph below).
This graph also displays how the size of homes on the market varies seasonally. During the summer months, larger homes tend to come on the market. This is when households with children out of school are looking to move. Due to this seasonality, historical trends and the approach of fall advise us to expect smaller, more affordable homes on the market through the rest of the year.
This expectation is GREAT NEWS. Why? As Robert Dietz, Chief Economist at the National Association of Home Builders (NAHB), states, the need for these types of homes has grown recently:
“. . . as interest rates increased in 2022, and housing affordability worsened, the demand for home size has trended lower.”
What Does This Mean for You?
Are you finding it difficult to afford a home? The seasonal trend of smaller homes coming to the market in the later months of the year, coupled with builders bringing smaller, more affordable newly built homes to the Kansas City market right now, is good news. Mikaela Arroyo, Director of the New Home Trends Institute at John Burns Real Estate Consulting, says this about a possible boost in the availability of smaller homes:
“It’s not solving the affordability crisis, but it is creating opportunities for people to be able to afford an entry-level home in an area.”
You can expect smaller, more affordable homes on the Kansas City housing market soon. Our realtors on the Just Say Home team are deeply connected in the KC area and know of homes not publicly listed on the MLS. Reach out to our real estate experts to find the perfect home for you today!