Current market trends highlight that this is a Sellers market. Inventory remains exceptionally low and demand is normal if not unusually high. February 2016 to February 2017 has seen inventory decrease by 17.2%.
Why, you might ask?
On average, home owners live in their home for 5-6 years before selling. When we witnessed the market crash in 2008; with it went many home owners savings and equity they had gained the previous years. The market needed to reset; but not without causing financial pain for so many.
According to NAR, the average time someone lives in their home has risen to 9 years. As there are less homes for sale; so to comes a rise in demand.
We are seeing positive trends though. Homeowners are better off than they have been in years. Equity has returned and most are no longer underwater on their mortgage. This will certainly push more to sell down the road. 2017 will continue to be challenging for buyers, but that doesn’t mean the perfect home isn’t out there. Here is what to expect:
Expect to be in full control. If the home is in good condition, desirable location, and priced right; sellers have the upper hand. Sellers can expect to receive list price or more in many situations. This isn’t fool proof though. Competitive pricing is everything. The market will tell you if you have priced too high! Don’t make this mistake, as you are losing potential buyers.
Expect to pony up the money for the house of your dreams. In many instances; will be required to offer above list and pay your own closing costs. This can put a strain on some; so it is important to plan ahead and ensure enough has been saved. Buyer’s may be on the hook for repairs too as sellers have many potential buyers and can afford to pass on basic repairs.
All in all; the market is hot for sellers. That doesn’t mean there is no opportunity for a buyer to get a good deal and a valuable home. Home values rose around 5% last year and NAR expects to see an additional 5% growth this year.