It is a seller's market out there ladies and gentlemen! If you have been thinking about selling your house, 2018 is the year to do it. You can take advantage of low inventory levels, low interest rates, and a pool of hungry buyers who are ready to chomp at the bit. We are currently experiencing the most robust market we have seen in the last ten years. Here is why taking advantage of this year is a brilliant, strategic selling move.
Historically Low Rates
Mortgage rate averages peaked just above 4.4 percent in 2017, but we closed the year out just below the current price. This year during the second week of January, the average rate was 4.17 percent for a thirty-year fixed-rate mortgage (Happy New Year to new homebuyers!). These rates are incredible but, as all good things do, they will soon see their end. And after such a long run at low rates, the rise will happen sooner than you might suspect.
Mortgage rates are not expected to spike significantly this year, they are forecast to increase overall in the years to come. Realtors predict that a thirty-year fixed-rate mortgage will rise to 4.6 percent by the end of this year, and they anticipate rates to grow to a solid 5 percent in 2019 and 5.3 percent in 2020.
While increasing interest rates are a sign of a good economy, they can squeeze out some potential buyers from the market. The current low rates can act as a catalyst for many potential buyers to get moving sooner rather than later. If you have been dragging your feet about selling or buying a house, now is definitely the best time to pick up the pace and hop on the market quickly!
Inventory Remains Tight, and Demands Remain High
It is simple math. There are just more buyers than available homes on the market these days. And the housing shortage is likely to get worse before it gets better. Sellers, this means it is your time to list because buyers are ready to dive on a deal.
People are starving for new inventory on the market. Having few options is a frustrating situation for homebuyers. Inventory levels are expected to begin rising in the fourth quarter this year, making it the first significant rise in inventory since 2015. The newly stocked MLS is sure to set the stage for more dramatic housing games to come. So if you are thinking of selling, start preparing your property right away. There is a pretty good chance that if you sell this year, you will walk away from the transaction with a sweet little payday bonus.
Putting your house on the market earlier means you could potentially sell it faster. List now, before other houses start cropping up and you find yourself competing for bids from the buyer. Fewer options on the market keep your home looking more attractive.
Home Prices are Still Increasing
From coast to coast, home prices continue to be on the rise. Home prices have risen forty percent in the past five years and do not seem to be leveling off. The rising house prices mean more profit for you after your house sells.
Choosing the right price is the secret ingredient to having a great selling experience. If you price your home too high, even in a hot market, it’ll sit on the market for longer than it needs to. Buyers may be desperate, but nobody is going to let a seller take advantage of them. Work with your agent to appropriately price your home for a seller's market.
People Have More Pocket Change
Record levels of consumer confidence, low unemployment, and stock market surges are setting the stage for high homebuyer turnout in 2018. As incomes continue to grow, and people find better and more stable jobs, homeownership becomes an option for many people.
It is also getting easier to qualify for a mortgage these days, which is due to several factors. Mortgage lenders have been accepting lower down payments, the debt-to-income ratio used to be eligible for most mortgages became more forgiving last year, and future home prices are expected to level off.
With the economy beginning to stabilize, people are more comfortable and confident in purchasing a new home. An increased income means more money in their pocket, waiting to spend it. Renting can be expensive, especially if you want to upgrade your living space. Many more people are now interested in buying a home. As a seller, this ultimately translates to more money in your pocket if you make a move and list your house now!
Millennials Are Ready to Settle
Millennials are often crippled by student debt, and home buying has primarily been curbed by rising interest rates and high home prices. They are the biggest group transitioning from renting to buying.
The conditions are ripe this year for these first-time buyers to dive into homeownership. Real estate experts predict that millennials will make up a vital part of the buyer pool over the coming year. How big? Millennials could account for a whopping forty-three percent of homebuyers taking out a mortgage in 2018. That number alone is enough motivation to give your marketing efforts a strong slant this year!
More buyers flooding the market can only mean good things for sellers--at all price points. Remember, a successful sale means everyone walks away feeling happy. If you get so greedy that the buyer walks away, you have let the deal get the best of you. Resolve to be reasonable, and you’ll end up shaking hands with the buyer at the closing. You should also know there are not unlimited buyer out there. If you lose one, it might take you quite some time to find another.