Inventory Levels Increased But Remain Low - Bellingham Is Still A Sellers' Market
Is Now a Good Time to Sell Your Home?
Inventory Levels
Inventory levels vary with the time of year - Sellers are more likely to sell their home in the Spring and Summer, and less likely to sell their home in the winter, especially around the holidays. There is a symbiotic relationship, where both Buyers and Sellers desire to move fluctuates with the seasons. While you can argue that the best time to list your home is when there are the most active Buyers searching for their new home, your home may also benefit from a periods of time when inventory levels are low - less competition!
Buyers' vs. Sellers' Market
A Sellers' Market vs. Buyers' Market is defined by home inventory levels. If there are 100 homes on the market and 50 homes are selling on average on a monthly basis, there is 2 months of inventory. When inventory levels are below 6 months, it's considered to be a Sellers' Market. Sellers have more power in negotiating the sale of their home, because there are less options (homes on the market) for the Buyer. We have been firmly in a Sellers' Market for over 5 years. One variable that has kept us in a Sellers' Market is insufficient new home construction. If inventory levels are at or above 6 months, we will be in Buyers' Market territory - Buyers have plenty of homes to choose from, so they have more power over Sellers.
Interest Rates
A higher interest rate means a higher mortgage payment. Buyers' motivation to buy is impacted by interest rates. But most buyers can't or won't wait years for interest rates to drop. And as homes have consistently increased in value over time, waiting to buy becomes more expensive, which at least partly offsets the higher mortgage payment due to higher interest rates. Buyers know that if rates drop, they can refinance their home loan.
Market Conditions
Beyond seasonal inventory level fluctuations, the economy and interest rates impact Buyers' appetites for purchasing a home.
Location, Condition, Price
These 3 variables impacts a home's desirability. You can't change your home's location, but you can improve it's condition, to maximize your home's sales price.
Pricing
Outside of professional, attractive marketing, by far the most important variable that will determine whether your home sells is price. The graphic above shows how pricing your home beyond its market value often nets you a lower home price than if the home was priced correctly when it first hits the market.
Selling Often Means Buying
Most Sellers plan on buying a home to replace the home they are selling. Whatever market conditions are impacting your home sale will also impact your home purchase. Are higher interest rates suppressing home price increases? That might mean you won't be able to sell your home to the highest bidder in a multiple-offer situation that drives up your price well beyond it's market value. Likewise, you will have less competition when you are buying your next home.
