Why 2016 REALLY IS the Best Time to Sell a Home
Sometimes real estate agents get a bad rap for allegedly telling homeowners anytime is a good time sell a home. Obviously, some market conditions are better than others for sellers. Conditions for sellers during the current buying season are as good as they’ve been in a decade or more, since the housing boom of 2005-2006.
Since the housing recovery began in earnest three years ago, conditions in most markets have increasingly favored sellers. Record low interest rates have bolstered demand, making it possible for buyers to lock in great deals on mortgages. The slowly improving economy has reduced unemployment and is lifting more incomes. The largest generation of potential buyers in history, millennials aged 18 t0 34, are forming households and think about home-buying age. New low down payment programs are making it easier for first-time buyers to leave behind rents that are rising at record rates.
In March, the launch of the spring home buyer season in Northern markets, RealtyTrac reported that the average home seller sold their home for $30,500 more than they purchased it for, a 17 percent average gain in price — the highest average price gain for home sellers in any month since December 2007 at the onset of the Great Recession.
Among 125 metropolitan statistical areas with at least 300 sales in March, home sellers realized the biggest average gains compared to purchase price in San Francisco (72 percent average gain); San Jose, California (60 percent); Boulder, Colorado (53 percent); Prescott, Arizona (51 percent); and Los Angeles (48 percent).
There were still 19 markets (15 percent) where home sellers in March on average sold for less than what they purchased for, led by Rockford, Illinois (11 percent average loss compared to purchase price); Winston-Salem, North Carolina (10 percent average loss); Cleveland, Ohio (8 percent average loss); Columbia, South Carolina (7 percent average loss); and Wilmington, North Carolina (5 percent average loss).
In its April consumer survey, Fannie Mae found that while it may be the best time to sell in years, it’s not the best time to buy. Some 15 percent of Americans say now is a good time to sell a home, an all-time for the survey, which began in 2010. At the same time the percentage of Americans who say that it is a good time to buy a house fell 3 percentage points to 30 percent, an all-time survey low.
Here are some of the factors behind the booming sellers’ market:
- The median sale price of homes sold in May broke the record peak sales price set last June, reaching $239,700 for all home types, up 4.7 percent from May 2015 ($228,900). May’s price increase marked the 51st consecutive month of year-over-year gains.
- Price of entry-level home values are rising twice as fast as top-tier homes over the past year, according to the Zillow. Concurrently, the number of entry-level homes on the market tumbled 9 percent from 2015.
- Properties are selling in record time. Homes stayed on the market a median 32 days in May, down from 39 days in April), which is below a year ago (40 days) and the shortest time since NAR began tracking time on market in May 2011.
- Inventories of homes for sale have been chronically low. Total housing inventory at the end of May was 2.15 million existing homes available for sale, 5.7 percent lower than a year ago (2.28 million). Unsold inventory is at a 4.7-month supply at the current sales pace, which is unchanged from April.
Homes.com is the place to dream and discover your ideal home! Are you starting to get the itch to look for your first or next home, but don’t know where to start? You’ve come to the right place! Browse our real estate and lifestyle blog for home buying tips, mortgage guides, DIY ideas, interior design, lifestyle topics, general home inspiration, or just some homes fun. We are sure you can scratch that itch and find all the information and tools you need to help in your home search. Want to start looking at available real estate right now? Head to our home page and check out homes for sale or rent listings all over the country.
Happy house hunting!