It's that time of year again, the spring real estate market. As we thaw out from the winter snows and freezing, you will see for sale signs popping up in yards just like tulips, green grass, and the flowering trees. Ahhh, I can't wait! Here are a few things that you need to know about the spring market.
The number of houses that will go on the market will increase significantly. Also, the number of buyers that are looking for houses will increase significantly. This is an interesting phenomenon that seems to happen every year without fail. I have a few theories as to why, starting with the mindset of the consumer, and of the real estate agents. Consumers will tell you real estate slows down in the winter, where many real estate agents will tell you to call back later, they're on vacation. There is some inteded humor there, and there is a great deal of fact.
If you are interested in selling, it is best to be on the market early rather than late, and here is why.
1. First and foremost, we are already at a inventory shortage. We have more buyers then we have good listings, so the buyer pool is bursting at the seams. Year after year I interview sellers wanting to list their home in May, the "spring market", right? Well, by May, the spring market is slowing down. I tell people all the time that the Spring Market actually starts in February.
2. When you sell your home, chances are you need to buy another. The higher the amount of buyers that are looking for homes can actually drive the price up and place you in a bidding war. This generally sounds like a good idea if you are selling a home, who wouldn't want more money, right? I appreciate that; however, if you are also purchasing a home, generally the percentage of increase means you will ultimately pay much more for your new home than what you are getting for the sale of your old home.
For instance, if you are selling a $150,000 home, your payment may be around $1,125 per month. If the bidding takes you to $160k, you get and extra $10k. Keep reading. You would likely be purchasing a $250,000 home and paying $1,800 per month. Two things could happen here if you too get into a bidding war, you may pay more to buy the home, and interest rates may be on the rise. If rates went up even 1/2 of a point here, and you bid only $5,000 more just to get the home, that could be a difference of about $100 per month in payment. I know that isn't Earth shattering, but it is $1,200 per year, or $36,000 over the life of the loan - FOR THE EXACT SAME PRODUCT!!! Ulitmately, you are losing thousand for a delayed decision.
Call your local Realtor® today to get the most information you can about selling your house immediately. Do not wait for the market to be at its peak as you could be paying peak prices. I cannot stress this enough.
Let me know how The Steinick Group can help you through your home selling and buying process. No matter where you live in North America, my team can assit you!
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