Should I sell my house now?
That’s been the question on everyone mind who has been looking to sell the last couple of years.
The housing market has been at an historic run the last couple years. With homes selling above asking price/appraised values, now might the time to act if you’ve been waiting for the dip. The market is still very strong due to the lack of houses on the market, however, with the government now increasing interest rates this could change very quickly.
“Signs that the market will start to cool can be found across the market. Mortgage rates
, which have increased at the fastest rate in decades this year, are now over 5% and are expected to keep rising. The more expensive it is to finance a home, the less purchasing power buyers have and many give up if they can’t afford a house that fits their needs. That, in turn, can lead to less competition and some price easing.
In addition, there’s been a five consecutive months of declines in pending home sales, as well as a drop in newly constructed single-family sales, according to the National Association of Realtors. That means fewer people have been willing or able to buy. And the share of listed homes with price cuts has been increasing over the past two months, according to Realtor.com.
The average profits made on selling a median-priced single-family home dipped in the first quarter, according to Attom, a real estate data company. While profit margins often decrease during the slower winter months, the latest dip marked the first quarterly decline since the fourth quarter of 2019 and the largest since the first quarter of 2011.
“Some sellers really made out over the past two years,” said Kupferberg. “Some buyers did, too. It was a win-win then, with rising prices and really low mortgage rates. Now it is different.”
She said sellers can often be slow to recalibrate after the market shifts, still expecting their home will sell in days with manic bidding wars.
“Prices are going to top out,” she said. “Then it takes a while for sellers to realize they have to lower their price. This pool of buyers can’t afford the home because the cost of borrowing has gone up.”
Credit: Anna Bahney