Many potential home sellers are on the fence as to whether now is the right time to place their homes on the market. Are we about to hit another pricing bubble? Yes, inventories are low. But at the core, your concerns are understandable. However, for you, the answer might be: “Yes! It is a great time to put your home on the market!” This is based on newly released data spanning the housing industry. Please use the information below to make an informed decision as to whether now is the time for you.
- Home sale prices increases show little signs of slowing down
Over the last 17 years, US existing home median sales prices are right on par with normal historic appreciation levels. The last four years have tracked right along the historic average and there are few reasons to believe this pattern will not continue.
- You have more equity in your home than you think you do
Most homeowners do not know just how much equity they have in their homes. A Fannie Mae & Core Logic study at the end of last summer revealed that only 37% of homeowners believe they have significant equity (>20%). However, the reality is that 79% of homeowners actually have greater than 20% equity.
- You do not need as high a credit score as you think you do
Many potential homebuyers and sellers believe they need a higher credit score to buy a home than what is actually necessary. This graph reports all closed loans per Ellie Mae over the last year and the credit scores buyers actually needed to qualify. You see that the majority (54.3%) of buyers actually had a credit score between 600 and 750, less than the 750+ score many believe they need. You need to know that you may qualify for a larger loan amount than you expect.
- Rates are expected to increase by over .40% in the next year
Mortgage rates are projected to increase over the next year. Fannie Mae, the Mortgage Bankers Association and NAR all predict gradual increases in mortgage interest rates over each of the next four quarters. As the graph indicates, providers expect rates will increase from 4.26 to 4.66 by this time next year. Do not let the recent slip in rates fool you, they are expected to climb back up.
- Monthly mortgage payments continue to trend upward
This graph shows the US average monthly mortgage payment on median priced homes from 1990 to today. Due to our near record low rates over the last 8 years, you see that mortgage payments remain below the average for the last 27 years. However, you also see that, since 2012, payments have significantly increased each year. With the combination of raising home prices and expected rise in rates, there is good reason to believe this pattern will continue. It might be in your best interest to move quickly.
Now might be the perfect time to put your home on the market. Take advantage of selling while rates are low, and before the increases in home prices and mortgage payments price you out.
As your trusted Mortgage Loan Originator, I am joyfully available to you to discuss the particulars of your situation and help you make the best choice. Please feel free to reach out to me via my contact information below.