The best time to sell anything is when demand is high and the supply of that item is limited. Recently the National Association of Realtors (NAR) revealed information that suggests that now is a great time to sell your house. They issued 2 reports: Pending Home Sales Report and Existing Home Sales Report.
THE PENDING HOME SALES REPORT
The report announced that pending home sales (homes going into contract) are up 3.9% over last year, and have increased year-over-year now for 14 consecutive months.
Lawrence Yun, NAR’s Chief Economist, expects demand to remain stable through the final two months of the year, and “forecasts existing-home sales to finish 2015 at a pace of 5.30 million – the highest since 2006.”
So demand for housing could continue throughout the end of 2015 and into 2016. It will be interesting to see though, how interest rates change in the near future and if that will be enough to affect the housing market…
THE EXISTING HOME SALES REPORT
- Total housing inventory decreased 2.3% to 2.14 million homes available for sale
- That represents a 4.8-month supply at the current sales pace
- Unsold inventory is 4.5% lower than a year ago
Yun also commented in the report:
1. “New and existing-home supply has struggled to improve, leading to few choices for buyers and no easement of the ongoing affordability concerns still prevalent in some markets.”
2. “Unless sizeable supply gains occur for new and existing homes, prices and rents will continue to exceed wages into next year and hamstring a large pool of potential buyers trying to buy a home.” As rents and prices increase, potential buyers will not able to save as much for a down payment and many may become priced out of the market.
Generally when there is less than 6 months inventory available, we are in a sellers’ market and we will see appreciation. Between 6-7 months is a neutral market where prices will increase at the rate of inflation. More than 7 months inventory means we are in a buyers’ market and should expect depreciation in home values. As Yun notes, we are currently in a sellers’ market.
Our inventory of homes is still below the 6 months needed for a normal market, so now could be the time to take advantage of the many buyers that are still looking to make a purchase now!