Winter is typically a slow time for home sales, when sellers might wonder if they have any hope of finding a buyer. But will that be the case this winter?
“Compared to other past winter seasons, this winter season’s sales activity will be stronger,” agrees Lawrence Yun, chief economist at the National Association of Realtors®. “This winter, there will be more sales compared to pre-pandemic winters going back all the way to 2006.”
This optimism stems back to (you guessed it) the COVID-19 pandemic lockdown, which created a pent-up demand for homes throughout much of 2020 that completely swamped the usual spring rush, winter lull rhythm of the real estate cycle.
And that overwhelming demand for housing is still going strong today.Another factor is that, with supply chain issues slowing new home construction, many buyers just couldn’t find their dream homes in the spring, summer, or fall—and will still be looking into the cold winter months.
So if you’ve all but written off the idea of selling your home until spring ’22, think again! Here are a few things to know about selling your home this winter.
Inventory is low—and homes are selling fast
Although the number of homebuyers house hunting this winter may be slightly lower than during the busy spring and summer seasons, these homebuyers mean serious business.
Home prices may have peaked
Another reason sellers may want to list their homes now is that prices are at an all-time high. According to Realtor.com data, median home prices in the U.S. now hover at $380,000, up 9% from a year earlier.
But there are signs that these high prices are leveling off.
Interest rates are creeping up
The all-time-low interest rates of the past 20-plus months inspired many buyers to shop for real estate. As of Nov. 10, interest rates were 2.98% for a 30-year fixed-rate loan, according to Freddie Mac. But these rates may be going up.
The Mortgage Bankers Association estimates that rates will rise to 3.1% by the end of 2021 and 4% by the end of 2022.
These increasing interest rates could discourage buyers from being as bullish going forward.
But wait, where will you live?
According to a recent Realtor.com survey, 36% of home sellers plan to buy a new home after they’ve sold the one they have. Yet if this is your plan, be warned that you may find yourself in the same hot seat: scrambling to buy a home amid limited inventory and high prices.
So you’d better have a game plan of where you’ll move once your home sells.
Another strategy to avoid selling your home without a place to live is to add a “home of choice” contingency, also known as a “suitable property” contingency. This is where your sale depends on your ability to find a new home within a certain time frame. If you can’t, you can call off the deal. Just know that this contingency isn’t used that often, since few buyers may be willing to be left hanging like this. Still, in a strong seller’s market—particularly during winter when no one may feel like moving in a blizzard—you might just have a chance.
Read full article on:Realtor.com