Ohio Real Estate Trends: What You Need to Know
“To improve is to change; to be perfect is to change often.” -Winston Churchill
Between a pandemic, new and disruptive technologies, shifting client demands, fluctuating mortgage rates, and changing regulations, real estate agents have learned to adapt. Industry change shows no signs of slowing down.
One way to protect yourself and your business is to identify and understand the trends impacting the industry.
Real Estate Trends in Ohio
These are the factors and trends that we see shaping the future of real estate in Ohio.
Continued Increase in Home Prices
According to mid-year data from Redfin, the year-over-year median price of a home in Ohio increased by 7.0%. Much of this demand is driven by single-family homes. As families move from urban centers and rental properties to suburbs, these buyers want single-family homes, and they are willing to pay a competitive price and outbid the competition for the home they want.
In the near term, this means that equity in existing home ownership has increased. It has also led to sticker shock as buyers begin evaluating the housing market, which may delay some buyers from looking for a new home.
Expected Decrease in Mortgage Rates
After the pandemic, mortgage rates rose to the highest levels in more than 20 years. Persistent inflation has kept them elevated, leading many new homebuyers to wait to purchase a home. Existing homeowners often delay putting their homes on the market because their existing mortgage rates are comparatively low.
As inflationary pressure decreases, experts expect mortgage rates to decline. This will likely lead to many buyers who were waiting to flood the market as demand for new homes increases.
A Competitive Housing Market in Ohio
According to data compiled by Redfin, in mid-2024, 40.3% of all homes sold in Ohio were sold above list price. The increase in price was typically the result of the home receiving multiple bids. This led to bidding wars, as buyers increased their offers for the home they wanted. This is a clear sign of a very competitive housing market.
While the number of homes selling above the list price has decreased slightly, it remains high. Expect that aggressive buyers will continue to rely on agents for help in finding the home they want.
Increased Demand for Single-Family Homes
The U.S. Census shows that homebuyers are leaving cities and urban areas for the suburbs. Exurban areas are growing faster than other regions in the U.S. As people move out of the cities to the suburbs, many want to own their homes rather than rent. This has increased demand for single-family homes. The opportunity for remote work and extremely high housing costs in cities have only added fuel to this trend.
Expect homebuyers to be more demanding as they look for a new home. They expect the convenience of a city, with the space and home ownership that are hallmarks of suburban areas. When they find the home they want, buyers will be aggressive in purchasing it.
The Shift Toward Digitalization and Technology in New Home Searches
Home buying didn’t stop during the pandemic. After an initial dip in demand, the housing market quickly recovered. In fact, with lockdowns, many families wanted a new home. This led to new technologies that shaped the buying process. During the pandemic, virtual staging, 3D home tours, and drone videos were all ways that a homebuyer could tour a home without leaving the couch. The popularity of virtual staging hasn’t diminished, and online tools are the first step for most new homebuyers.
Expect the trend to continue as more millennials and Gen Z become homeowners. Social media, text messaging, and digital campaigns will continue to grow as vital tools in real estate.
Real Estate Commission Changes Are Here to Stay
No longer are home sellers required to pay their own agent and the buyer’s agent. Instead, buyers need to negotiate and pay for their own agent. Buyer’s agents will need to market themselves and their services and tell buyers what their commission will be. In the short term, there will be a lot of confusion, but over time, it’s likely that agents will need to look at additional services they can provide or different avenues of compensation.
If you are looking for commission work with buyers, then build your portfolio of service offerings and be prepared to negotiate your rates.
Looking to the Future in Real Estate
Change can be intimidating, especially in an industry like real estate. But it can also unlock new opportunities for agents willing to adapt and capitalize on industry trends.
If you have questions or want to discuss any of the topics here, contact the team at Network Land Title Agency. As one of Northeast Ohio’s leading title agencies, we have the expertise and resources to help agents deliver exceptional service. Let us know how we can help you.
