Mortgage rates are low and home inventory is low, making negotiations more favorable for sellers. Here’s what the real estate community is saying about this winter⛄️
Despite real estate experiencing great strength this year, one challenge for the housing industry heading into the winter is the dwindling number of homes available for sale. Lawrence Yun, Chief Economist for the National Association of Realtors (NAR), recently said, "There is no shortage of hopeful, potential buyers, but inventory is historically low.”
In addition, Danielle Hale, Chief Economist for realtor.com, notes, “Fewer new sellers coming to market while a greater than usual number of buyers continue to search for a home causes inventory to continue to evaporate.”
One major indicator the industry uses to measure housing supply is the months’ supply of inventory. According to NAR, “Months’ supply refers to the number of months it would take for the current inventory of homes on the market to sell given the current sales pace.”
Historically, six months of supply is considered a normal real estate market. Going into the pandemic, inventory was already well below this mark. As the year progressed, the supply has was reduced even further.
What does this mean if you’re a buyer?
Be patient during your home search. It may take time to find a home you love. Once you do, be ready to move forward quickly. Get pre-approved for a mortgage, be prepared to make a competitive offer from the start, and understand how the shortage in inventory has led to more bidding wars.
What does this mean if you’re a seller?
Realize that, in some ways, you’re in the driver’s seat. When there’s a shortage of an item at the same time there’s a strong demand for it, the seller is in a good position to negotiate. Do not be unreasonable, but understand you probably have the upper hand.
The housing market will remain strong throughout the winter and heading into the spring. DM us to learn more about what that means for you, whether you’re buying, selling, or doing both.
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