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1. Renting
The trend of the past 2 years continues as there's low inventory making the rental market competitive. Rents are up and typically the broker fee falls on the tenant, although we are slowly starting to see the trend come back for landlords to contribute especially in some luxury buildings, more often in the fall/winter seasons vs the spring market. June & September listings start coming up as early as March, while others will come on the market only a month or two before the lease start depending on landlord/location. Move-in costs will often require up to 3-4 months (first, last month, security & broker fee).
Be pro-active, be flexible & be prepared!
2. Buying
It continues to be a highly competitive, fast-moving market. Bidding wars are common. This trend is expected to continue in 2014, but there's hope more sellers will begin to sell this year. While buyers may pay over-asking prices, interest rates remain relatively low compared to history's averages (see chart below, reproduced with the permission of Mortgage-X.com).
A 1% rise in interest rates can mean almost a 10% rise in a monthly mortgage payment.... so ready, willing and able buyers shouldn't be afraid to make a move. Another advantage buyers still have is the many first-time home buyer programs available; while there are the traditional FHA & Mass Housing loans (including low downpayment options 3%+ & no PMI programs), many banks have recently started to offer their own in-house FTHB programs with similar incentives. Timing wise, the height of the market is between March and June- i.e. when the most listings are available. Don't by shy to look before or after- the height of the market is also when the majority of buyers (=your competition) are looking.
Know what you can afford, be patient, be flexible & be aggressive!
3. Selling
It's what conventionally known as a "seller's market"- low inventory & high demand = competition among buyers and homes selling quickly, at great prices. This stems from many factors including low interest rates, rising rents, great loan programs and the desire for many to live in "hubs" and city-like areas. Sellers wishing to sell should certainly take advantage of this. However, it's equally important to price a home right so that a seller capitalizes on these conditions and gets maximum exposure (and have a plan of action to reduce a price in 2 weeks if no activity). Also timing is a factor - the spring starts earlier and earlier each year so consider getting listed and on the market by March.
Know your competition, be aggressive, set expectations with your agent!
Remember: whether you're renting, buying or selling, having a knowledgeable, experienced, and communicative agent with a proven track record is crucial!
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