By Holly Amaya
1. Rates are still historically low, drawing buyers into the market
We may not be enjoying the rock-bottom interest rates of yore, but by historical standards, today’s 30-year mortgage rates—hovering just above 4%—are still low. And experts agree mortgage credit will remain relatively cheap for most of the year.
That means the getting’s still good for buyers—and, subsequently, for sellers looking to unload their homes.
But rates are on the rise, and it’s been widely predicted that they’ll reach 5% before year’s end. Buyers know that the longer they wait to buy, the more expensive it will be.
Roughly translated, that means you’d be wise to list your home earlier in the year, before more rate hikes kick in. Not only will you capture the market of buyers scurrying to close a deal, but if you’re buying after you sell, you’ll also benefit from those lower rates.
2. Inventory remains tight—and demand high
Simply put, there are more buyers than available homes—particularly in red-hot markets where land is scarce and it isn’t cheap to build.
And the housing shortage will likely get worse before it gets better: Realtor.com data predicts inventory will remain tight in the first part of this year, reaching a 4% year-over-year decline by March.
Sellers, that means this is your opportunity to be wooed. Buyers, their choices limited, are going to great lengths (and making some major concessions) to win the house.
Inventory levels are predicted to begin rising in the fourth quarter, marking the first inventory gain since 2015 and setting the stage for more dramatic housing gains to come. So if you’re thinking of selling, start preparing now in order to walk away with a sweet paycheck.
3. Home prices are still increasing
From coast to coast, home prices continue to rise—which translates to more money in your pocket when you sell.
But the gains are predicted to be more moderate than in years past. Realtor.com data suggests a 3.2% increase year-over-year, after finishing 2017 with a 5.5% year-over-year increase.
Bottom line: You still stand to make a pretty profit if you sell this year, but the earlier you can list, the better off you’ll be.
4. People have more money in their pocket
Record levels of consumer confidence, low unemployment, and stock market surges are setting the stage for high home buyer turnout in 2018. For the first time since the 1960s, the Fed has projected that the unemployment rate will drop below 4%, and the domestic stock market is enjoying a nearly unprecedented rally.
The housing market is already reflecting this boom: Existing-home sales soared 5.6% in November 2017 (the most recent month for which data is available) and reached their strongest pace in almost 11 years, according to the NAR.
“Incomes are growing and people are finding better and more stable jobs. Buyers are feeling pretty good about (their) finances.”
All of these factors combined mean more buyers could be on the hunt, with more money in their pockets to shell out on a home for sale—possibly yours!
5. Millennials are ready to commit
Millennials, often crippled by student debt, have been especially hampered by rising interest rates and high home prices.
But the aforementioned conditions are ripe in 2018 for these first-time buyers to take the plunge, and experts predict that millennials will make up a vital part of the buyer pool over the coming year: Millennials could account for 43% of home buyers taking out a mortgage in 2018 (a 3% year-over-year increase), according to realtor.com data. “As people move into their 30s, they’re looking to move from renting to homeownership,” Dietz says. “And we predict that trend will continue even more this year.” More home buyers flooding the market can only mean good things for sellers—at all price points.
Read The Full Article