On the fence about selling your home? It might be time to hop off. 2017 is poised to be the year of the home seller, with a combination of factors coming together to make this a prime seller’s market for most of the nation. Here’s why:
Mortgage Rates are Low
Low mortgage rates translate to low monthly costs, which entices buyers. Mortgage rates are just over 4%, a bit higher than they were at the end of 2016, but the rates for a 30-year fixed mortgage (the most popular home loan) are still hovering near 30-year lows. Potential buyers armed with this knowledge might hustle to close on a home before a rate hike, and even if you’re not quite ready to put your house on the market, rates towards the end of this year are still expected to be low.
Inventory is Shrinking
While existing home inventory peaked at 4.04 million homes for sale in 2007, just before the housing crash, there were only 1.85 million homes for sale in November of 2016- 54% lower than the 2007 peak. Sellers this year have the least competition, and what’s more, homes are spending less time on the market now than they were a few years ago- another boon for sellers.
Home Prices are Rising
With a decrease in inventory and an increase in demand, it’s no surprise that home prices are rising. Median existing home prices increased by 6.8% from November of 2015 to November of 2016, which was the 57th consecutive month of year-over-year gains. 2017 will likely serve as a balanced market for buyers, with mortgage rates edging up and sellers having recovered enough equity to be able to afford to sell.
Job Markets are Strengthening
As unemployment decreases and wages increase, consumer confidence climbs (which spurs buyers to jump into the market). An increase in confidence generally results in a virtuous cycle, in which people gain confidence, spend more money on big-ticket items, reinforce the economy, and then gain more confidence, thus completing the cycle to the benefit of essentially all consumers.
Source: Realtor