Population growth adds to the frenzy around the booming real estate market | Business premises

The Silo City US Warehouse is being converted into luxury apartments and retail space in the first phase of a plan to reuse many of the site’s historic buildings.

Derek Gee/Buffalo News

If being a homebuyer in Buffalo Niagara wasn’t hard enough these days, the area’s growing population means there are now even more people who might be willing to outbid you for your next House.

The Western New York housing market has exploded in recent years as an imbalance between supply and demand sent bidders into a feeding frenzy and pushed prices to new heights.

In other words, there aren’t enough homes for sale – or at least good ones – to satisfy all the people looking, at a time when low mortgage rates allow bidders to go higher.

So, for every house that is priced right, well-maintained, and well-appointed, a horde of eager beavers looking for their new home descend like a pack of wolves in an attempt to out-compete their rivals.

New influx of immigrants to Vive (copy)

Vive’s assistant director Maria Perez Gomez, right, escorts Emilia Louisiac of Haiti carrying her newborn daughter Lia Keisha. Population growth adds to the housing shortage.

Robert Kirkham

Of course, a single buyer can win each of the ensuing bidding wars, usually only after putting all the stops on their bid. And that means everyone else – dozens in some cases over the past two years – find themselves licking their wounds and quickly looking for the next house that catches their eye. etc

It’s not new. New homes over the past year are coming up for sale at a rate that is only slightly faster than they are selling. With the market already very tight, this means that the competition for sought-after homes is not waning.

The number of homes available for sale – less than 1,500 in November – fell to historic lows. At the current rate, if nothing more was added to the inventory, the supply of homes for sale would run out after 45 days – compared to 180 if the market was at a point where buyers and sellers were on a high. equality.

Why are fewer people selling? Many are already comfortable where they are, without needing or wanting to move. They have already refinanced their mortgages or even paid them off. And there is more support and desire to age in place instead of moving to senior living communities.

They also invested in their homes, renovating or expanding them to create their dream homes, especially when they were locked down for months during the first phase of the pandemic.

And now, even if they are thinking of selling, they are afraid that they have no other place to go, because they see what is happening around them with other buyers.

Meanwhile, strong demand has been spurred by ever-lower interest rates, which have made borrowing cheap – and bids higher.

The median sale price has jumped 15% locally over the past year, slightly faster than the 14% rise nationally. But the median price here of just over $200,000 is about 40% lower than the national median of $359,000.

At the same time, market-priced apartment rates have risen amid the city’s resurgence and renewed enthusiasm for living in an urban environment. It is therefore often more interesting to buy than to rent.

But now it turns out that a new factor has been added: the population of Buffalo and Erie County has actually increased – which means you wouldn’t imagine there are more people at the looking for a house.

According to the 2020 census, the city’s population grew by 6.5% over the past decade, to 278,349 people. It was its first gain since 1950. Erie County also rose 3.8%, to 954,236. The growth was led by refugees, immigrants and other residents of color, and was spread nearly also between the city and its suburbs.

It’s a dynamic that the region’s political, civic and business leaders have long sought. This is the sign of a reversal in progress. But it also creates a new, perhaps unexpected dilemma: where to place everyone.

Basically, efforts to support Buffalo’s economy appear to be paying off, as the long-suffering region has more than regained its confidence.

Investments in real estate development and infrastructure are transforming the physical landscape. Government efforts to promote startups and strengthen the tech sector are giving rise to a thriving entrepreneurial culture, exemplified by the 43North competition and the success of new ventures.

Employers are more successful in attracting workers to Buffalo, especially among expats in the area who have long wanted to return home and are feeling a new vibe in Western New York.

The region’s lower cost of living attracts those working in larger, more expensive cities. And more college and graduate students are staying in the area rather than leaving town after graduating, seeing new opportunities where their predecessors had none.

However, all these new people need a place to live. And while many young people are content to rent an apartment for a while, many others prefer to put down deeper roots.

In a normal housing environment, market forces would take over. The demand would be enough to stimulate more listings and encourage the construction of new homes, ensuring that a sufficient number of homes are available without interruption.

But that didn’t happen. There is no indication that more people are considering putting their homes up for sale. People have less incentive to move. And builders are struggling to keep up with demand as soaring labor and material costs — not to mention supply chain disruptions — have made it harder to build while keeping homes newly built out of reach for many.

The challenge now is to remedy this negative, before it undermines the positive. Dreams of seeing Western New York grow again are coming true. Now we have to stop them from turning into nightmares.

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