Thinking of selling your home? This might be the right time

Home prices are at record levels and still risingBut there is Some early indications that The market may start to cool down. For sellers looking to get the top dollar for their home, now is the time to sell.

Jeff Tucker, chief economist at Zillow, said homeowners are still reluctant to list their homes. While the inventory of homes for sale has risen this spring, he said it has more to do with falling buyers than the influx of new homes hitting the market.

“These higher prices don’t seem to particularly motivate sellers, or even about how April and May are the best time to list a home for a quick sale that gets a high price premium,” Tucker said.

He said the main reason homeowners haven’t flocked to the market to take advantage of it is simply because they still need a place to live. “They worry, quite reasonably, that they will need to pay a lot to find somewhere else that is as good or better.”

Many potential sellers are waiting for the right moment to strike, said Tracy Murray Kupferberg, an agent with Douglas Elleman in Long Island, New York.

“A lot of people say, ‘Did I make the mistake of waiting because I won’t get the price of a dream again?’” “There are concerns that they will miss the peak,” Kupferberg said.

But there is reason to believe that this peak could be now.

It’s impossible to say exactly when the market will be, but many analysts expect home prices to peak this quarter.

“The pace of price hikes is likely to peak sometime this quarter, either in April, May or June,” Tucker said. “That would be the high watermark of the annual pace of appreciation, and then it would slow down.”

Signs that the market will start to cool can be found throughout the market. Mortgage rates, which increased at the fastest rate in decades this year, has now exceeded 5% and is expected to continue rising. The more expensive a home finances, the less purchasing power buyers have and many give up if they can’t afford to buy a home that fits their needs. This, in turn, can lead to less competition and some easing in pricing.

In addition, there have been five consecutive months of declines in pending home sales, as well as lower sales of newly built single-family homes, according to the National Association of Realtors. This means that fewer people are willing or able to buy. According to Realtor.com, the share of homes listed with price cuts has increased over the past two months.

Average earnings from selling a mid-priced single-family home fell in the first quarter, according to Atom, a real estate data company. And while profit margins often decline during the slower winter months, the latest drop marked the first quarterly decline since the last quarter of 2019 and the largest since the first quarter of 2011.

“Some of the vendors have had real success over the past two years,” Kupferberg said. “Some buyers have done it too. It was a win-win situation, with prices going up and mortgage rates really low. Now it’s different.”

She said sellers can often be slow to recalibrate after market shifts, and still expect to sell their homes in days with crazy bid wars.

“The prices are going to go higher,” she said. “Then it takes a while for sellers to realize they have to lower their price. This group of buyers cannot afford the house because the cost of borrowing has gone up.”

Lotte Funk has been on the fence about selling her home, mostly because she wasn’t sure where her family would go.

Funk knew that when her second child arrived in a few months, the space in her suburban Chicago home would be tight. But she hasn’t been able to find many homes on the market that seem a good fit, in addition to the persistently high home prices and mortgage rates. However, like many would-be sellers, she knew that if she and her husband did not sell soon, they would miss out on getting the highest price for their home.

“We were very aware of the interest rate hike,” she said. “We thought this house should be sold and bought now, or renovated so we could survive.”

Even when they thought of expanding the three bedroom townhouse where they live with their young child, a dog and a cat, they still looked to the new listings in the market.

Earlier this month, they found the perfect five-bedroom home in a nearby suburb. Once their offer was accepted, they raced to put their house on the market within a week. They couldn’t afford to move both homes, so their new home bid was contingent on selling their current home by mid-May.

They listed their house for $315,000 last week and had already seen over 20 views, but they had no viable offers.

“Everything I know about the market tells me that houses have to fly off the shelves,” Funk said. When things are not sold, so is the price or the product. It was a bowel rehab a few years ago, and I know it’s not the product. So it should be the price.”

They will lower the price and see if that brings the buyer at the right time.

“I don’t want to lose the house I love,” Funk said. But, she added, she was willing to sell her home for a little less than her dream price, only to be able to buy her next home.

When Kupferberg, the dealer in Long Island, visited a potential seller’s home recently, she told the owners he would sell quickly, even if he needed a little work.

A three-story home with five bedrooms, a pool, and tennis court had become too much for empty residents, and Kupferberg knew it would be attractive to buyers willing to pay top dollar.

However, the couple hesitated in the decision to sell or stay.

“They don’t want to miss the mark, they know their house is going to sell right away,” he said. “But if they take the leap now, where will they live?”

Kupferberg said she doesn’t have easy answers. Many of her potential clients are homeowners who have a large home and would like to downsize, but also want to stay in the community near their children or great grandchildren, where their church or synagogue is located, close enough to go to the same doctor. There are not many options.

“I don’t know what to say to people who want to sell but have nowhere to go,” she said. “Unless they have another home or have a relative to stay with so they can take advantage of what we’re seeing at the end of the sale market.”

Kupferberg said this particular couple were looking for a bungalow in a vibrant, upscale gated community, but there were few options and it wasn’t immediately appealing.

“There is nothing that really meets their needs,” she said. “They have nowhere to go if they sell, so they’re staying now.”

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