The past few years have been good for sellers. This side of the housing market has benefited from the rapid rise of home appreciation, historic low mortgage rates available for refinancing options, and growing equity. Homeowners thinking of selling their home may believe they missed the best time to list but according to many national experts, the market is favoring sellers. Lawrence Yun, the Chief Economist at the National Association of Realtors shares, “There is an ongoing housing shortage, and properly listed homes are still selling swiftly.” Although the housing market is still considered a seller’s market based on supply and demand, the market is projected to begin normalizing into a more neutral market where inventory can catch up and even match buyer demand.
While it’s true to say mortgage rates are on the rise, knowing and understanding historic context is everything. Mark Fleming, Chief Economist at First American, explains: “Rising mortgage rates impact affordability, but historical context is important. An average 30-year, fixed mortgage rate of 5.5% is still well below the historical average of nearly 8%.” The mortgage rate increases will undoubtedly have an impact on some homebuyers, but sellers who have voiced their concerns that the new rates will price out a certain demographic of homebuyers can rest assured that there is still a large pool of interested potential buyers, many of whom have been patiently waiting for a less competitive market.
The first quarter of 2022 saw double-digit price appreciation for a number of markets across the United States, including many of our own markets! The rest of 2022 is expected to see continued home price growth which is good news for sellers who are looking to list their homes later in the year. The pace of this increase will be more moderate compared to 2021 but is predicted to still continue on an upward trend.
If you aren’t sure how much equity you have in my home take a look at your monthly mortgage payment. Equity is determined by calculating the current value of your home minus what you owe on the loan. Sellers have experienced a major equity boost over the past few years thanks in large part to the housing shortage. In 2021, U.S home prices rose 18% one of the largest annual gains on record which directly impacts the equity you have in your home. As a homeowner, equity not only builds your wealth, but it can also help you achieve other financial goals, such as buying a new home sooner than you would have expected otherwise, and possibly being able to bring money to the table!
This summer is a great time to capitalize on market trends and your Realtor has the most reliable tools to use to help you determine the value of your home! A real estate review is helpful whether you are looking to sell your home or simply curious to know how the market has changed its value.