Over the last several years, we’ve been experiencing a Seller’s Market here in Brunswick. Like most of the country, low housing inventory is driving competition among buyers. Unprecedented demand has been pushing prices higher and higher since 2010. Recently, a survey of industry experts predicts that by 2019, the market may switch to favor buyers.
Have Home Prices Leveled Out?
Up until July of this year, national home sale prices had been climbing for 6 years. For the first time this decade, the national average home sale price has remained stagnant for three full months. We are experiencing this same trend in Brunswick, with home prices remaining steady at about $216,000 (or declining by a fraction of a percent) since June. This is a sign that the market is shifting.
Economist Dr. Svenja Gudell recently addressed this issue in a press release, stating “the housing market has been favoring sellers for the past few years. Sellers in the current housing landscape often have the luxury of listing their home ‘as-is’ without fixing it up or with only minimal window-dressing since demand for homes has been high and inventory low. It’s common for sellers to receive multiple bids, and in the hottest markets, sell for over asking price, but these conditions will change in the future. As the number of homes for sale increases and home value appreciation slows, we expect the market to meaningfully swing in favor of buyers within the next two to three years.”
Market Shift vs Economic Recession
We are likely to soon experience a housing market shift in favor of buyers, but it’s unlikely that we are on the precipice of a recession. In fact, most indicators show signs that our economy will continue to grow.
Unemployment rates are at record lows, household incomes are rising, and over the last ten years, the personal savings rate has remained very high (hovering around 6% each month, which is 25% higher than the previous decade, according to the US Bureau of Economic Analysis). Even amid global trade tensions, the overall US production (or GDP) is forecasted to grow by a full 2.5% in 2019 (according to the Federal Reserve).
The housing market has been extremely tight for a long time. Although sellers are enjoying high prices, a market correction is long over-due and will bring much-anticipated relief to buyers —many of whom are currently priced out of the market altogether.
Getting Ahead of the Buyer’s Market
While homeowners should not be worried about drastic losses in equity, they should expect to receive lower sales prices in the coming years. As sellers begin to see prices fall, they may rush to the market at once, which could temporarily create extra supply (reducing prices even more). Any homeowner considering selling will not find a better time to list than right now, before this happens.
Although late fall is one of the slower selling seasons of the year, this currently isn’t the case in Brunswick. Many buyers were unable to purchase over the summer, with increased competition and slim pickings. They are still anxious to buy a home, and many of them would like to be moved in to their new house before Christmas. This is a great opportunity for sellers who want a fast sale and a competitive price.
If you have been on the fence about selling your home, or if you’re just waiting for the right time, give us a call at 440-879-7260. We’ll provide you with a custom, in-depth home valuation based on multiple factors, and answer any questions you have.
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