What is Shrinkflation? Impact on Home Values
Shrinkflation is is a unique period that occurs when the price of a house remains the same, but the amount of square feet you receive is less. As inflation increases raising the market, homeowners and companies are trying to recoup their investments.
According to Zillow, in 2020 the average home sold in America was $329,000. In Q1 of 2022, that number has risen over 30% to $428,700. You can see these stats on The Ascent.
When you compare this to the growth in average home size, it tells another story. The average single-family home size in 2015 was 2,261 sq ft and in 2020 that number jumped to 2,467 sq ft. That is about an 8% increase in home size. That is a strong example of Shrinkflation.
So if you are looking to sell your house and it seems your potential buyers are having a hard time agreeing with the home values. This is one of the main reasons.
Our CEO Blake Soreano was just interviewed on this topic. Check it out here on WSMV4 and see what he has to say.
“Look for exactly what you want. Have some patience. The market is softening. What you can get today, you might get a little bit of a better deal tomorrow. We still do have an inventory problem. If you get into something that will fit all your needs, move on it,” – Blake Soreano
Sell Your House
This is what you might want to do.
Remember when it comes to selling your house there are a wide variety of ways to do this. You can either list it with a Real Estate Agent or Directly yourself. You can also take advantage of selling your house in different off-market avenues. With Shrinkflation happening regular home buyers are having difficulties making the leap.
The high-interest rates are making it more difficult to afford the monthly mortgage that comes with them. So take your time. If you need to sell faster and don’t have the time, breathe and then connect with different types of investors. Sell your home for cash and the buyer won’t have to worry about the high-interest rates making them more like to actually buy.
Here is a quick story about a homeowner that was recently caught in a pickle. About a year ago his father passed and he received the house. He could not keep up with the mortgage or fix up the house to sell because he already owned another. Two houses were just too much.
He tried selling using traditional methods and it didn’t work. The houses needed work and people were not willing to pay the price. The bank was coming to take the house in the next two months and he needed to sell fast.
He asked us “Please help me sell my inherited house”. We put his house in front of our investors, he did not receive the original amount he wanted, but he was able to sell the house. the loan with the bank was paid and he received an extra $100,000 in his hand that he wouldn’t have had if he waited any longer.
The bank was going to take his house, leaving him with nothing. But the option to sell his house, leveraging our off-market buyers relieved all of his stress. This put him in a position greater than he has ever been in before.
Whichever route you chose to take, know that you have options. We will help you Get An Offer quickly.
Buy Your House
Why is buying a home difficult?
Many people ask this question, but the truth of the matter is it isn’t actually difficult. You just have to open your eyes to the many potential investment opportunities. There are all types of houses, from single-family to condos, townhouses, duplexes, and even land.
- You can partner up with someone to buy your next home. Many people are doing this as a co-ownership opportunity.
- Look into potential fixer-up houses and make a project out of them.
- Buy within your means. This doesn’t always sound fun but it’s your first home and can leverage this house to buy your next home.
- Be willing to make the drive.
- Buy land and add a modular or manufactured home to it.
Remember when you buy your house, you are investing in yourself and your family. The interest rates are high, but if you make a plan you will get there. There is always an entry into the market, just be willing to do something different that the status quo.
Pay attention to the actual Home Values around your area. Yes, things are changing. Try not to just pay attention to what your neighbors are putter their houses for sale at. Many of these houses have been advertised for months.
Additionally, many have also started cutting their prices and still have not sold yet.
A better way to value your home is to look at what has sold in your area, compare the sizes, beds, baths, and how recently those houses have sold and go from there. Also, if a home sold a year ago for a certain price, that doesn’t mean your house is worth the same or more. It is a different world today than it was a year.
If you need to sell your house reach out to us today. Fill out our Get Offer Form and will assist you in getting the best off-market price for your house.
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