12/04/2021
Little Creek Housing Market Jan-Nov 2021: Continuing my thread on the Sussex, DE housing market I will analyze a Hundred to the southwest, Little Creek, DE.
Market Health-This year had a remarkable sales rate in Little Creek. There have been 244 residential homes listed, and 243 sold. Demand is swallowing up supply & sellers are reaping the fruits of their investments. The average asking price for a home was $242,449. however, the average sold price was $251,000. Buyers are paying on average $8,551 OVER asking price. Further eluding to the strong seller market, with experts expecting this trend to continue into next year.
The Good: If you are selling your home the market is phenomenal. The listed/sold ratio is heavily in your favor, and homes only take an average of 46 days to close. if you are a CASH buyer you are also in a favorable position. Cash remains king and those who can afford to skip contingencies are getting great deals without as much completion by those priced out by the market and low appraisals (If you don't know what this means contact your realtor asap).
The Bad: Lower income families are feeling left behind as low inventory increases the price of homes. Builders are delayed, and with new potential tariffs on building materials and rampant supply chain issues home prices may increase even more come next year. Increased prices directly influences the average Delawareans ability to go from pre-approval to successful appraisal, to closing. Making conventional loans for many out of reach.
My Opinion: Owning a home is the American dream. If there is a future where Americans can't afford home ownership, then we are lost. At present, a down-payment for a conventional loan is between 3% and 20%. If in worst case scenario I only qualify for the 20% loan and I purchased the median $251,000 home in Little Creek, I would need $50,200 for the down-payment. Assuming closing costs are in the national range of 5% of the homes price, then that would be an additional $12,550. That's a grand total of $62,750 upfront before you set foot in your home or even make a mortgage payment. How many Delawareans, let alone new and young home buyers have amassed a savings of that size? The question is "At what point are Delawareans forced to abandon the American dream as they're priced out of the market?" Or in contrast, "When will supply increase enough to match demand and lower home prices?"
My belief is that nobody can know for sure, and experts who claim they do are likely misleading you. Markets fluctuate, and if you had a crystal ball that could predict their rise and fall with 100% accuracy, then you would need to log off Facebook and go become a wall street billionaire as that's a better use of your time. However, what is 100% certain is that time waits for nobody. If you are a home buyer and you can afford a house, then I recommend you buy. Don't put your life and family on hold due to real estate speculation. If you can't afford it then you should speak to a realtor, lender, and other professionals to help you understand your options. I am hopeful we wont let property ownership slow, and as supply gradually increases more Delawareans can have land of their own.
