It’s a Seller’s Market!
When you see something as crazy as this seller’s market, naturally everyone’s big question is, “But for how long??” What comes up, must come down!
Being able to see that turning point may mean the difference between making some serious bank on your sale and being left with more than a few regrets that you waited too long for the peak that is already gone.
If you are a buyer in this market you are likely asking yourself this question so you can gain your sanity again! You can’t just keep overbidding and losing every multiple offer situation ’til the end of time. Eventually, you are going to need a house….and preferably one that isn’t 900 square feet for a cool $2 million.
No one has a crystal ball but there are several factors that created this market and when you watch for those changes, then you will see the situation they created change as well.
Here are a few questions to ask yourself:
Are Interest Rates Increasing?
One main reason it still makes sense for buyers to continue to endure these bidding wars is that the interest rates have been historically low.
So even if they pay top dollar for the home, at the end of the loan, they saved a major chunk of change by locking in a low interest rate.
When it makes financial sense, buyers will continue to engage in bidding wars. To that end, keep an eye on these interest rates!
Current projections show that by the third quarter of this year the average interest rate will be 3.35% and will increase to 3.67% by the second quarter of 2022.* Not a huge increase, but the days of 2.5% interest rates may well be behind us.
Are COVID-19 Restrictions Lifting?
Obviously, COVID-19 affected every industry and the real estate market is no different. Many put the sale of their home on hold to see how their job, life, and basically the whole world was going to change and make a decision when things became more clear about the future.
One year later, we have a vaccine available and are slowly finding our way to a new normal. When you see people resuming more and more “normal” activities and, non-essential workers getting back to work, sales on all fronts will increase.
Have you noticed any changes happening this upcoming summer in your area with restrictions being lifted? If so, then likely those neighborhoods who held off on selling their home last year, are considering selling their home now that there is a way to safely do it!
Are Properties for Sale Near Me?
Keep an eye on your neighborhood!
The number of homes on the market being very low has been THE MAJOR contributor to this seller’s market being so hot.
When buyers have more options, they do not have to outbid one another for the only house within a 20-mile radius that meets their needs.
Once you start seeing several “For Sale” signs in your neighborhood, you may have missed the boat on multiple offer situations. In the first two months of 2021, our country-wide inventory was 1.9 months and it is now up to 2.1 months.*
A survey of economists done by Pulsenomics shows that 43% of economists believe the housing inventory will grow in the second quarter of 2021 and 26% believe that growth will happen during the first half of 2022.
Every area is a bit different, so it’s best to make sure you know how many months of inventory there are near you and it will be a good indicator of how high in demand your house would be on the market.
As you may have caught on by now, these factors are starting to change bit by bit.
Does that mean the tide is turning?? Not exactly… there doesn’t seem to be a major flip from sellers to a buyers market in our near future, and inventory is projected to stay relatively low for some time.
But will you make more money off your house now versus 6 months from now? The answer could be yes!
Dying to know what your house could actually go for right now?? Call us and we will walk you through the numbers and all the options to see what makes financial sense for you.
*All numbers and statistics provided by Keeping Current Matters