HOW'S THE MARKET? GOOD QUESTION!
High-interest rates continue to dampen the overall market. Just like home buyers, sellers are feeling the pinch of increasing mortgage rates as they ponder selling their home … will they find a place to live? The term dubbed by Realtor.com for this seller stall is “rate lock,” fear of trading in a low rate for a higher one if they decide to sell and then buy.
The good news (and there’s always some good news) is that those adventurous souls willing to dip their toes into the selling pool are receiving excellent responses from buyers with solid offers. With home sales continuing to outpace supply, much of the valley has been propelled into a strong seller’s market and significantly more robust than anybody expected. As a result, many homes go under contract within days of listing, at or over ask, and with favorable terms.
At the start of the new year, home prices began to stabilize after a mild dip in late 2022. These past three months have rewarded sellers with rising prices. This upward movement is expected to continue throughout May.
WHAT CAN WE EXPECT MOVING FORWARD?
More of the same. Sellers reluctant to sell, buyers vying for less inventory with multiple offers, new listings under contract immediately, and rising prices should continue playing out in 2023. We anticipated more homes on the market by now, but the fact that inventory is slowly growing in mid-May is notable. Last year we experienced a 25% drop in buyer demand allowing inventory to build. This year, demand is slightly higher as buyers take advantage of adjustable rates and cut back on other expenses, making calculations that they can afford their payments now and will adjust back to a more comfortable normal when the rates go down.
Overall 2023 is shaping up to be an up year on pricing with a supply-constrained market and a steady stream of buyer demand for that supply. As a result, we expect to see fewer price cuts as homes get offers at listed prices, continued increases in list prices, and various levels of seller markets throughout the valley.
PEARLS OF WISDOM
My tidbit of insight for sellers is that contingent offers are not working. So take the plunge as you hold the key to more inventory and ultimately damping down increasing prices.
Are you ready to jump into the buying pool? Crunch those numbers and cut where you need to cut. If you are a bit uncomfortable or find nothing in your price point, consider tabling the home of your dreams and go for something more modest. With rising home prices, modest home buying today may be the stepping stone to home nirvana five years down the road.
TAKE CONTROL
Navigating a competitive housing market requires strategic planning and a strong financial foundation. While waiting for the new digs to hit the market, try implementing these 7 household budgeting tips to position yourself as a top pick and increase your chances of securing your next home.
Reach out today for help to get started on your home-buying journey!
~ Susan, Jennifer & Taylor
