Why Seller's Need To Pay Attention To A Coming Buyer's Market
Nationally, home sales are below last year's levels, home values are appreciating at a slower pace, and there are reports showing purchasing demand softening. This has some thinking we may be entering a buyer's market after seller have had the upper hand for the past several years.
The market has definitely softened. However, according to two chief economists in the industry, we are a long way from a market totally favoring buyers.
Dr. Svenja Gudell, Zillow Chief Economist:
“These seller challenges don’t indicate we’re suddenly in a buyers’ market – we don’t expect market conditions to shift decidedly in favor of buyers until 2020 or later. But buyers certainly are starting to balk at the rapid rise in prices and home values are starting to grow at a less frenetic pace."
Danielle Hale, Chief Economist of Realtor.com:
In addition, Pulsenomics Inc. recently surveyed over one hundred economists, real estate experts, and investment & market strategists and asked this question:
Interest rates are going up but they are still relatively low compared to years past. Inventory of homes is loosening but it's still pretty low. SO LISTEN UP! If selling your home is on your radar, get off the fence and make it happen. You want to sell NOW when rates are still low to attract the most buyers. You want to sell NOW when inventory is low. And you want to sell NOW before other sellers begin offering their homes at a reduced price.
Our Local Market
Locally, we are experiencing a market shift. August 2018 vs 2017, pending sales are down 9%, closed sales are down 3% and the total days are on the market is longer, up 18%. Prices are up from last year but that is also slowing. Things are changing. But what is happening and what does this mean for you as a upcoming home seller.The market has definitely softened. However, according to two chief economists in the industry, we are a long way from a market totally favoring buyers.
Dr. Svenja Gudell, Zillow Chief Economist:
“These seller challenges don’t indicate we’re suddenly in a buyers’ market – we don’t expect market conditions to shift decidedly in favor of buyers until 2020 or later. But buyers certainly are starting to balk at the rapid rise in prices and home values are starting to grow at a less frenetic pace."
Danielle Hale, Chief Economist of Realtor.com:
“The signs are pointing to a market that’s shifting toward buyers. But, in most places, we’re still a long way from a full reversal.”
In addition, Pulsenomics Inc. recently surveyed over one hundred economists, real estate experts, and investment & market strategists and asked this question:
“When do you expect U.S. housing market conditions to shift decidedly in favor of homebuyers?”
Only 5% said the market has already shifted. Here are the rest of the survey results:
The Bottom Line
The market is beginning to normalize but that doesn’t mean we will quickly shift to a market favoring the buyer. We believe Ivy Zelman, author of the well-respected ‘Z’ Report, best explained the current confusion:
“With the rate of home price appreciation starting to decelerate alongside the uptick in inventory…we expect significant debate about whether this is a bullish or bearish sign.
In our view, the short-term narrative will probably be confusing, but more sustainable growth and affordability will likely be the end result.”
My Advice
So clearly the experts and the numbers show there is a shift happening. And eventually, this will more significantly benefit buyers. But we aren't there yet. So what does that mean for you if you plan on selling your home in the near future?Interest rates are going up but they are still relatively low compared to years past. Inventory of homes is loosening but it's still pretty low. SO LISTEN UP! If selling your home is on your radar, get off the fence and make it happen. You want to sell NOW when rates are still low to attract the most buyers. You want to sell NOW when inventory is low. And you want to sell NOW before other sellers begin offering their homes at a reduced price.
About Scott C. Dickinson
Scott C. Dickinson is a real estate broker who resides in Vancouver, WA. He can be reached ScottYourBroker@gmail.com or call him at 360-518-7197.
Follow him on Facebook at www.facebook.com/YourBrokerScott or on Instagram at
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