We all realize that the best time to sell anything is when demand is high and the supply of that item is limited. The last two major reports issued by the National Association of Realtors (NAR) revealed information that suggests that now may be the best time to sell your house. Let’s look at the data covered by the latest Pending Home Sales Report and Existing Home Sales Report.
THE PENDING HOME SALES REPORT
The report announced that pending home sales (homes going into contract) “surged” by 6.1%. The increase was “the largest month-over-month gain since April 2010, when first-time home buyers rushed to sign purchase contracts before a popular tax credit program ended”. Lawrence Yun, NAR’s chief economist, expects improving home sales throughout the rest of the year: “Sales should exceed an annual pace of five million homes in some of the upcoming months behind favorable mortgage rates, more inventory and improved job creation.” Takeaway: Demand is beginning to increase dramatically compared to earlier in the year.
THE EXISTING HOME SALES REPORT
The most important data point revealed in the report was not sales but instead the inventory of homes on the market (supply). The report explained:
Total housing inventory climbed 2.2% to 2.28 million homes available for sale
That represents a 5.6-month supply at the current sales pace
Unsold inventory is 6.0% higher than a year ago
There were two more interesting comments made by Yun in the report:
“Rising inventory bodes well for slower price growth and greater affordability, but the amount of homes for sale is still modestly below a balanced market.” In real estate, there is a guideline that often applies. When there is less than 6 months inventory available, we are in a sellers’ market and we will see appreciation. Between 6-7 months is a neutral market where prices will increase at the rate of inflation. More than 7 months inventory means we are in a buyers’ market and should expect depreciation in home values. As Yun notes, we are currently in a sellers’ market (prices still increasing) but are headed to a neutral market.
"New home construction is still needed to keep prices and housing supply healthy in the long run.” As new construction begins to be built, there will be increased downward pressure on the prices of existing homes on the market.
Takeaway: Supply is about to increase significantly. The supply of existing homes is already increasing and the number of newly constructed homes is about to increase.
If you are going to sell, now may be the time.
Author:Marc Blitstein Phone: 303-330-4058 Dated: July 3rd 2014 Views: 793 About Marc: Marc Blitstein has been a licensed Real Estate Agent since 2004. Real estate experience has been in ...
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(Guest blogger, my wife – May 31, 2018, 6:47 p.m.)To say that the pr
"When I decided to sell my home and look for a new place, my first call was to Jim and Ion Real Estate. He listed my condo and in two short weeks my place was under contract. Now, the real fun began, looking for a new place! The Ion Real Estate website was great. I loved the map function and the emails it sent with new listings that matched my previous searches. On Saturday, Jim and I headed out to look at several places I had picked to see. At the time I didn’t really notice how he listened carefully to everything I said about each place from the lighting to the layout. I was even a little sad that I didn’t find anything that day but Jim reassured me not to worry and a week later he had set up some more appointments. I still remember walking into my new place and just knowing. I had only taken two steps into it and I knew I wanted it.
Next came the easy part for me, but this is where having the right realtor and mortgage broker is essential. They make it seem easy! Jim guided me through all the aspects of my sale and purchase. I appreciated how simple each step seemed from making an offer to dealing with inspections. Even the loan seemed easy. I asked a ton of questions, I think it’s the teacher in me. I wanted to understand all the moving parts. Jim explained everything so clearly that I joked that he missed his calling and should have been a teacher, but he didn’t, I’m glad he is helping people find their homes!
Recently one of my close friends mentioned she wanted to stop renting and buy. I immediately referred her to Ion Real Estate. This time I was able to watch with an outsider perspective at the way Jim cued in on my friend’s preferences. Stephanie kept talking about the charm of old houses, a far cry from the sleek modern condo I chose. By the second house-hunting excursion, Jim knew just which home she would pick. As we walked up to the front porch, I saw Stephanie with the same excitement I had felt just a few months earlier. I watched her mentally move in her furniture and this time I saw the smile that crossed over Jim’s face when he knew Stephanie had found her home.
Throughout both experiences, it was clear Jim understands what people want in their homes and how to structure the entire buying experience to be a positive one. I have heard so many crazy stories from people that didn’t chose the right realtor or mortgage broker. They always start by saying, “I didn’t think a realtor made any difference.” It makes a difference! It made a difference for me and for Stephanie. Owning is better than renting; and, it is even better when Jim and Ion Real Estate are guiding you through the process!