Despite another year of surging home sales and several years of strong growth in the housing market, it’s still hard to believe we’re here. Just four short years ago, the housing market had hit rock bottom following. Millions of homeowners were underwater, foreclosures were rampant, and there was a general negative outlook about the housing market.
But the market has recovered, and today homeowners are in a much better position. And if you or someone you know has been stuck in recent years and unable to sell, now might be the the right time to finally move on.
Rising Prices Are Helping Homeowners Regain Equity
According to RealtyTrac, the number of seriously underwater homeowners (owing at least 25% more than the property is worth) fell to 6.06 at the end of Q3 2016. That’s down from 6.9 million in Q3 2015, and down from a peak of around 12.8 million in 2012. Millions of homeowners have escaped negative equity, and as prices continue to rise, more and more escape all the time.
Thinking of Selling? Good News… It’s a Seller’s Market
Why do home prices continue to rise? Demand for homes continues to rise as first-time buyers and homeowners previously sidelined enter the market, but the supply of homes for sale hasn’t kept up.
With low inventory and high demand, buyers are forced to compete over the available properties. This push prices up, and puts a lot of power in the seller’s hands. Right now, sellers are finding they can sell their homes easier, faster and for more.
It’s Also a Great Time to Buy!
What makes today’s market so unique is it is also an amazing time to buy. Mortgage rates have remained at near historic lows, allowing buyers to afford much more home, as the chart below shows.
But These Market Conditions Won’t Last Forever!
The conditions that make today’s market such a strong time to sell or buy won’t last forever. Next year, inventory is expected to increase. New home construction is reaching record highs, and more new homes will come on the market in 2017. More homeowners are expected to list their homes as well. This means more competition for you if you’re trying to sell your home.
What’s more, interest rates are rising as well. Already, interest rates have crept over 4% as we start the new year. Even small increases in interest rates can have a large impact on affordability.
So if you’re thinking of selling, take advantages of today’s market!