Real Estate Storm Clouds Looming
The real estate market has been making up for lost time, but things could change soon.
A surge in sales and record prices
This Spring, home sales slowed to a crawl due to the coronavirus pandemic onset. However, this Summer, the market has come roaring back. Sales of existing homes surged to record numbers in Summer alone. That's the biggest gain in sales since the National Association of Realtors started tracking these numbers in 1968.
Home prices have also been rising. The median home price reached a high this Summer, both in absolute terms and also when adjusted for inflation. When adjusted for inflation, current median home prices were 3.4% higher than the previous record set during the housing bubble of 2006 - and we all know what happened just after that.
Never-before-seen mortgage rates
One thing that's contributing to both sales and price growth are record-low mortgage rates. The average 30-year mortgage rate dropped to the mid 2's no long ago. That's a number that would have been unimaginable just a year ago. This is making homes more affordable to buyers, and increasing demand even more than the lockdown exoduses may have. However, things might be changing.
Clouds on the horizon
It was recently reported that nearly a third of renters were unable to pay rent. Likewise, a growing number of homeowners are falling behind on mortgage payments. These are lingering effects of the economic lockdown surfacing now because of unemployment benefits and various mortgage forbearance programs are coming to an end. That's why experts predict a rise in foreclosures, defaults, and evictions, which is likely to wash over the entire market in the coming months.
What does this mean for you? Well, if you have been thinking of selling, now might be a golden moment. A severe lack of homes for sale means you could sell in record time, and since low mortgage rates are making homes more affordable, you could get top dollar for your home.
However, the dark clouds mentioned above could change things quickly. We could see an influx of new homes for sale on the market, which would drive down prices and SHIFT us into more of a buyer's market, with many homes sitting for months while buyers pick and choose among them.
That's why it makes sense to act now if you've been thinking of selling. If you'd like to get started, you can get a broad idea of what your home might be currently worth with this home value calculator, which is based on recent sales:
If you are ready to get the process rolling, give me a call at 910-395-1000. We've helped dozens of sellers over the past months, and we've sold quickly and at top price.
So if you have questions, give us a call and we will be happy to be a resource, so you can make the best choice for your circumstances.