We often hear the question, “Are we in a buyer’s or seller’s market?” It doesn’t have to be one or the other, and in fact it appears that right now we have both at the same time. Real estate, like any market, is driven by supply and demand, and “supply” in real estate is the number of properties (inventory) available to buy. When supply is “down” and demand is “high”, prices tend to rise. For now, buyers and sellers both are winning.
There is no question that prices are going up. That is not a reason for buyers to “pause,” but rather to take action. I disagree that there will be another big “drop” in prices soon. In order for prices to drop, we need to have a surge of inventory to meet or exceed the current demand. This is not happening. In fact, we are entering season, and there will be even more buyers and increased demand. Although prices are going up, they are a fraction of what they were and will be again. So, it is a great time to buy.
For many homeowners this is also an ideal time to sell. Why? Although your property value may increase over the next six months or more, waiting mean you may not be able to afford the same opportunities. If you were to sell now—at prices lower than they will be in six months—and also buy now, the property you are buying may be worth significantly less than it will be at the end of those six months. That savings may be a lot more than if you wait to sell.
This is a balancing act so, please consult a Realtor® who has a proven track record, and if you want to buy and sell at the same time, that Realtor can coordinate the transition. Now could be the best time now in your life to make that transition.
Where is the bad news? Frankly, I don’t see any. Interest rates are at their lowest in over 40 years. Prices are still incredibly low, and if you sell before you buy, your property—if priced right and marketed properly—should move quickly. The only “mistake” you could make (if you plan to buy soon or have plans to change where you live) would be to do nothing.
You may hear stories about banks “releasing a lot of foreclosures,” but don’t let that be a reason not to take action. The banks are selling foreclosures in “groups” or “portfolios” to investors, and so the number of foreclosures is also declining. When foreclosures do appear on the market, they are not priced as low as they were in the past, and they often sell over the asking price in multiple offers.
For buyers, seller, investors, and even spectators, it is almost all good news. The world seems to stress bad news and good news is often “lost.” That shouldn’t keep us from improving our lives and enjoying one of the rare really positive times in both our national and local economies.
Rick Gibson is a Realtor and Team Leader with Re/Max Preferred. A Certified Distressed Property Expert (CDPE) and Investment Agent Specialist (CIAS), he is Principal of Gibson Group Property Management, LLC.
