5 Things Every Seller Should Know in this Market
The real estate market has been red hot for more than a year, pushing prices up in most neighborhoods. The high prices come with pros and cons, though. While it feels like a great time to sell a house, more than 80% of young Americans (18 to 34 years old) say that now is the wrong time to buy.
You might wonder, "How can I sell my home when no one wants to buy in this real estate market?" That's a terrific question. Luckily, a little preparation can go a long way in making the process easier and helping you get as much as possible for your property.
1. The Real Estate Market Is Red Hot Right Now!
The real estate market is red hot right now because supply has not kept up with demand. To some extent, the short supply comes from the high price of construction materials. Developers don't want to build single-family homes when essential materials like lumber cost so much.
The problem might not be as recent as it seems, though. About 12.3 million households were formed in the U.S. between January 2012 and June 2021. During that same period, only 7 million homes were built. The short supply has finally caught up as young people plan to start families and purchase their first homes.
What's important for sellers to recognize is that the U.S. has about 5 million fewer houses than it needs to meet demand. That makes your residential real estate very valuable.
2. Expect to Spend Time and Money on Home Improvements (If They are Necessary)
Consult with your real estate agent on what improvements might help your home sell quicker and for more money. If you agree on improvements needed, make sure you set aside plenty of time and money.
Supply chain disruptions have forced contractors and construction companies to charge higher prices and work at slower paces. Many of them would love to get more work accomplished. Unfortunately, it's hard for them to source some of the materials they need to keep up with client requests.
Talk to contractors now so you can get realistic price and time estimates. If you don't already have a contractor, talk to your Realtor to get recommendations. An experienced real estate professional will know which renovations companies are more likely to accommodate your preferred schedule.
3. Interest Rates Will Likely Increase Soon
Many economists believe that the Federal Reserve will need to implement sharp interest rate increases soon to combat inflation. It's an ongoing discussion, so nothing is certain. Just keep the possibility in mind. Turning down a good mortgage offer because you demand an excellent one could end up costing you more money.
4. Work With a Real Estate Agent to Find the Right New Home Quickly
Not everyone finds a new home before selling their current one. Other homeowners experience the opposite problem: the hot real estate market makes it easy for them to sell, but they need to find short-term housing while they search for a new home they love.
You can make some of your money back when you need to cover two mortgages for a few months. However, you don't get that benefit when you pay for short-term housing. So keep that in mind for budgeting purposes.
Work with a real estate agent so you can find a home you love as quickly as possible. You don't want to rush into a decision. Choosing a wonderful new home becomes a lot easier, though, when you have a knowledgeable Realtor on your side.