First-time home buyers looking for smaller homes in St. Paul are often competing with older homebuyers who want to downsize. This has been the trend for the past few years.
The younger buyer sometimes has an advantage because they don’t have a house to sell and some older buyers have an advantage because they can pay cash.
The number of cash purchases is up. In 2021 about 30% of home purchases were cash which is up from 2020 when it was less than 25%.
There are also investors who can pay cash and the number of houses that are being bought by investors is rising.
The only upside to the situation is that when people downsize they often have a house to sell.
In the next 8 to 10 years we should start to see a shift in the housing market as more baby boomers reach their 80s and in twenty years there may even be more houses for sale than there are buyers.
The best way for buyers to navigate the housing market this spring is to be flexible and ready to act quickly. Take advantage of holiday weekends and stay in town and make an offer. Houses often go on the market on Thursday with offers due by Sunday.