Why Now is the Best Time to Sell Your Home
If you are thinking of selling your home but want to get top dollar for it especially if you bought at the top of the market in 2006 you may want to consider selling it now and here’s why.
Back in 2006 we were at the top of the last housing bubble and homes were becoming unaffordable for too many people. With the mortgage market full of toxic loans that could not perform. The housing and financial markets crashed. As a result, foreclosures went up to a level never seen before. The Federal Reserve had to step in and start flooding the market with money starting in November 2008 to save the financial industry. This caused rates to start going down as you can see on the chart below. April 2009 the rates were a full percent lower than 2008 thus making housing more affordable. What the Federal Reserve did wasn’t enough so they added more money to the system lowering the rates even more. By January 2012 the housing market bottomed out and pricing began to swing back the other way with appreciation as the demand for housing outpaced the supply by May of 2013 the Federal Reserve has stated the economy has improved enough to start bringing in the qualitative easing and reduced their amount by 10 billion per month causing mortgage interest rates to go up almost a full percent within a couple of days. In the year since this happened housing appreciation has slowed to around 6% and this year is likely to be less as inventory is starting to return to normal levels without all of the foreclosures.
Which brings us to what is likely to happen moving forward. We know the Federal Reserve is going to continue to scale back on the qualitative easing and end the program causing interest rates to climb higher raising the cost of home ownership. The hope is housing pricing will flatten out so the appreciation is minimal. When the rates do rise higher, it will increase the cost of home ownership and reduce the number of potential qualified buyers.
So as of April 2014 we know
1. Appreciation is slowing down to normal levels,
2. Housing is still in a shortage though returning to normal
3. Interest rates have not risen to their normal levels yet
4. Home buying season is about to begin
We can easily deduce there is still opportunity to get your home sold while the market is favorable to sellers. It is common knowledge that it is better to get out of an investment before it reaches the top of its value then after the fact.
What we don’t know
1. Will the higher rates push homes out of too many people’s price range?
2. Will housing prices fall as rates go higher or will the economy improve enough for them to have low appreciation?
3. At what point will it be a buyer’s market instead of a sellers?
Timing will help you maximize your sales potential. But if you want to safely go after that little bit more, work with a realtor who can properly market and negotiate the best terms for the sale of your home. A Certified Negotiating Expert or CNE designated realtor is well equipped to handle the negotiations side for you.
Article by Brandon Hovind
Sr. Mortgage Banker NMLS 277995 with Universal American Mortgage Company, LLC dba Pinnacle Mortgage Group NMLS #1058 Office: 949-208-7271
#1 on 2014-Apr-14 Mon 04:36+0
Location & Information
- Bedrooms: 4
- Bathrooms: 3
- Property Type: Sold Properties
- Size: 2,583 sqft
- Year built: 1967
- Added: 4 years ago
- Zip: 92649
Realtor Lisa Karos
Real Estate Agent
Licensed Buyer’s Agent Mickey Kinser
Licensed Buyer's Agent
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