Have We Flipped From a Seller’s to a Buyer’s Market?

Here in the Upstate, in a word, yes. There are all kinds of statistics that the real estate industry uses to determine which market we are in, Often the defining parameter is months of inventory. Simply put, if there are 2 months of housing inventory, that means that if you did not add one more house to the “for sale” column, there would still be enough inventory to satisfy buyers for 2 months. THAT is a sellers market!

As you can imagine, this is not very scientific and it is filled with all sorts or variables, but it is still thought to be the most reliable metrics when it comes to making this determination.

At the peak selling season earlier this year we were around 3 months, so still a sellers market. At the moment, we are sitting very close to 5 months of inventory, which is a huge jump and while some would say it’s “neutral”, I am here to tell you the truth…we’re in a buyers market.

Some other factors are factoring into the headwinds that sellers now face. They include

Seasonality – As we get closer to Thanksgiving and Christmas, the buyer pool naturally shrinks. People can easily be swayed to stay put through the holidays.

Interest Rates – Despite the recent half point cut in the Fed Funds rate, Mortgage rates actually rose and now sit near the recent highs. I always tell my clients that the Fed does not set mortgage interest rates, the 10 Year Treasury Bond does. That instrument is determined by the bond market, completely apart from the short end of the yield curve that the Fed controls.

New Housing – now this is a big part of the housing inventory number creeping up to 5 months, but I am breaking it out as a separate item. As a listing agent, I am mostly working with existing home sellers, and the fact that new home starts are now about 30 % of the available housing market is putting substantial downward pressure on existing home prices. Keep in mind that builders can offer all kinds of incentives that homeowners can’t to make their inventory more attractive. I’ve seen 4 percent mortgage rates and closing costs offered to entice buyers.

Now considering this, does it mean that you can’t sell your existing home? Of course not! What it does mean is it is more important than ever to work with a Realtor who understands how to price your home correctly and market it to buyers who are looking for a home in an established development or area with character and history JUST LIKE YOURS!

We are closing on existing homes every day, so let’s get together and discuss the right way to add your home to the list of closed sales so you can be in your next home in time for Christmas!

Call, text or email me now so we can sit down now and develop just the right plan to sell your home.

Have a great weekend and upcoming week.

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