The weather may not be cooperating just yet, but it is officially spring. The spring and summer seasons are generally the most active for home buyers and sellers. We anticipate an increase in home sales activity for the 2023 spring real estate market. If you are planning to buy or sell a home in the next few months, it’s important to understand what to expect.
Here are a few items to consider as we head into the spring and summer markets:
Mortgage Rates
Mortgage rates crept up as high as 7%, and there have been ups and downs as the Fed tries to fight inflation. Higher mortgage rates often equate to lower selling prices as buyer demand goes down. However, demand will pick up heading into spring and could provide a nice boost for the real estate and mortgage industries. If you are buying a home and your budget can handle the prevailing rate, you can look to purchase now. Just don’t depend on rates dropping significantly in the future. If they do, you can refinance when the timing is right. Make your plans based on current rates. If it’s the right time to buy, don’t let higher rates hinder your move.
Seller Expectations
Buyer activity is choppy in the current real estate market. Homes that are priced correctly, in desirable locations and in good/great condition will still see strong buyer interest. Multiple offer scenarios can take place. Don’t assume your house will get multiple offers. Be ready to put some work into it and hire a Realtor® who is skilled at staging and marketing to attract more qualified buyers. The best listings will still draw more potential buyers and competitive offers.
Housing Inventory
This can be a tricky subject because inventory has different ways of being represented. The numbers are down so far this year compared to 2022 in terms of total number of homes listed for sale. However, the “months of inventory” has been increasing. It does not mean there are more houses for sale. It means some homes are taking longer to sell. Activity should pick up heading into the spring real estate market, but we may see different numbers than previous years.
Inflation
There are also different ways of looking at inflation, especially when it comes to a stable-cost asset like real estate. Inflation will increase the value of the property over time. Homeowners who bought while mortgage rates were low are sitting pretty right now, which is why there are fewer homes on the market. Home sellers may not be inclined to sell unless they have a compelling reason. Whether you are buying or selling, it’s important to understand the reasons why you are moving to determine if now is the best time to take action.
Local Market Conditions
Remember that all real estate is local. There are hot and cold spots throughout the country, and the spring market will vary in our own metro area. Whether you are making a local move or planning to move to a different area entirely, you will want to know market conditions where you are selling and/or where you are buying.
We are in interesting times right now with high inflation, high mortgage rates and high home prices. Real estate is never a bad investment. Success comes down to understanding the market, having a good plan and making smart decisions throughout the home buying or selling process. When you navigate this year’s spring and summer markets wisely, you will be in a strong position for years to come. That’s why it pays to work with experienced real estate agents who can help you make the most of your move.
If you are buying or selling a home in Southeastern Pennsylvania or Northern Delaware, contact The Cyr Team today for an introductory real estate consultation. Don’t wait too long if planning a spring or summer move. It’s never too early to start planning and preparing!