Home buyers are on the move once again and have been so for several months for both existing and new home sales. According to the Census Bureau,* there were 517,000 new homes sold in the month of April, the latest month this data is available. New home sales have been on a steady rise sincePrices Up Demand Strong early 2011.

The National Association of Realtors also reported** that pending home sales, those with contracts on them yet to close has risen for four straight months and at the highest level in nearly 10 years. What does that tell real estate investors? That there is a pent up demand for housing and home values are also on the rise, this according to CoreLogic, the real estate data firm. Home values for March rose another 5.9 percent compared to one year ago.

As home values rise, fewer people qualify for a mortgage, or at least one that can finance the home they really want. Interest rates are still at relative lows with few signs the Fed will make a move anytime soon which is also contributing to the purchase volume but that also means rents will also follow suit. Demand for housing doesn’t necessarily mean owning, it means finding a place to live. People can own or they can rent and when home sales are up as well as values, higher rents will inevitably follow.

For now, real estate investors are still in the sweet spot for most markets whether they’re investing in residential properties or multifamily units. Financing costs are attractive for both investors and owner-occupant buyers. Those in the private note market are also finding solid opportunities investing in real estate as buyers gain more confidence in the market. Continued housing demand, pending home sales and price increases all point to a positive environment for investors.

 

*   www.census.gov

**www.realtor.org/new-release/2015/05