Questions You May Have About Selling Your House

Mortgage rates undeniably influence today's housing market significantly. This might lead to questions about the feasibility of selling your house and relocating.

Here are three key questions you might have - along with the data to address them.

Tip #1 - Should I Wait to Sell?

If you are considering holding off on selling until mortgage rates decrease, there are some important points to keep in mind. Many others are also contemplating the same strategy.

Although mortgage rates are predicted to decline later this year, delaying your sale could result in facing increased competition as more buyers and sellers re-enter the market. As per Bright MLS:

“Even a modest drop in rates will bring both more buyers and more sellers into the market.”

If you wait, you will encounter challenges such as rapidly increasing prices and facing multiple-offer situations when purchasing your next home.

Tip #2 - Are Buyers Still Out There?

However, not everyone is staying put at the moment. Even though some individuals are hesitating, there remains a significant number of active buyers in the current market. And here is the data that supports this claim.

The ShowingTime Showing Index serves as a gauge for the frequency of home tours by potential buyers. The following graph illustrates buyer activity for March (based on the most recent data) over the last seven years:

Demand has decreased since the 'unicorn' years, as indicated by the dip in demand shown in pink.

** The "unicorn years" in real estate are the years 2020–2022, when the real estate market experienced extraordinary conditions:

• Demand: Low interest rates made borrowing more affordable, and the COVID-19 pandemic increased demand for properties with home offices and large backyards

• Scarcity: There were fewer properties available, and some areas saw double-digit increases in home values year over year

• Record high sale prices: Home prices reached unsustainable levels, and the market favored sellers

This decline is influenced by various market factors such as higher mortgage rates, increasing prices, and limited inventory. To truly gauge current demand, it is essential to compare the present situation with the last normal years in the market (2018-2019), rather than the abnormal 'unicorn' years.

Focusing solely on the blue bars provides insight into the comparison for 2024. This perspective offers a fresh outlook.

Nationally, demand remains high compared to the last normal years in the housing market (2018-2019), indicating a market for selling your house.

Tip #3 - Can I Afford To Buy My Next Home?

Concerned about affording your next move with current rates and prices? Consider that your current home likely has more equity than you think. Homeowners have accumulated significant equity in recent years, which can greatly impact your next home purchase. You might even have enough equity to become an all-cash buyer and avoid taking out a mortgage. According to Jessica Lautz, Deputy Chief Economist at the National Association of Realtors (NAR),

"...those who have earned housing equity through home price appreciation are the current winners in today's housing market. One-third of recent home buyers did not finance their home purchase last month, reflecting the highest share in a decade. For these buyers, interest rates may have less influence on their purchase decisions."

Moral of the Story

If you've been pondering these three questions and they have been hindering you from selling, the information provided here may offer clarity. A recent survey by Realtor.com revealed that over 85% of potential sellers have been contemplating selling for over a year, indicating a significant number of hesitant sellers like you. However, the same survey interviewed sellers who recently decided to list their homes, with 79% of these sellers expressing regret that they did not sell sooner.

For further discussion on these topics or additional information, feel free to reach out to Amanda.

SCHEDULE CONSULTATION