It seems like a seller’s market. House prices are rising and there aren’t a lot of new homes being built. Interest rates are still good and the economy is booming.
All of this is the case as of right now, early summer 2018. So, should you hold off another six months or year before listing your house?
Everybody’s life is a bit different, but if you are looking at the market overall, the answer is, no, don’t wait. Sell your house now.
Here is a list of reasons that we can see on the horizon that might affect the housing market:
- Interest rates will rise. There really isn’t any debate about it. The Federal Reserve has been raising interest rates lately and there is no reason that they’ll stop. Every ¼% in interest increases will pull thousands of buyers off the market. It can be hard for you to consider, but interest on a mortgage can double the cost of the house for a buyer.
- Wages aren’t increasing as fast as home prices (or most other prices for that matter). Since it’s the wages that the buyer will use to buy a house, every time house prices go up 1% and the buyer’s wages stay the same, they are much less likely to buy.
- It’s more difficult for people to borrow money now than it was in 2008. Banks are very cautious, not least because there are a few people who’ve gone back to using the same ill-advised mortgage schemes that caused problems in 2007.
In 2017, home prices rose about 8%. This means that if your home is with $200,000, you can make an extra $16,000 (less broker fees). That might seem like it’s worth it, but if you’re waiting, any increase in interest rates for your next home may offset the increase price of your house. You can end up paying a lot more for your mortgage by waiting.
For the most part, now is a great time to sell your home. We’re not at a bottom and we’re not at a peak. Everything has its worries and concerns, but this is a solid time for selling and buying.