Market Report/Update
Big question these days, is the market shifting? I believe we are seeing a slight change, not so much a shift. Each day I am checking the MLS listing search database and see the number of listings available. During the winter months we typically see more homes/properties on market that are available to buyers. Currently we have a higher number of properties available than during our recent winter months. What this means is buyers have more options available to them, and sellers have less buyers per property.
Prices have rose month after month across the board for all types of properties. For homes and condos I am seeing up to 5% increase over the last highest priced sold comparable home or unit. This means a condo being listed at the same complex as one sold recently for $500k, the unit going up for sale can now sell for $525k. This is a current trend I am seeing for my sellers listings and buyers purchasing. Often we have an appraisal gap if we have an appraisal at all to cover this difference from the last sold to the current contracted unit or home. An appraisal gap means that the buyer will pay x dollars over an appraised amount. Typically appraisals are only conducted on units or homes that the buyers are obtaining a loan. Sometimes a cash buyer may want an appraisal done as well to determine a value by a licensed appraiser, however your real estate agent is able to give a value based on recent sold properties in the area or complex and adjusting subject to the condition and upgrades if needed. This is also how we choose a sales price when listing (plus the up to 5%. 😉)
The increased interest rates and sky rocketing home prices have made some home buyers skeptical if it is still a good time to buy. Although interest rates have rose quickly, it is not enough to make enough difference that renting is a better option than building personal equity in owning your own home. My suggestion to buyers is to buy now and refinance when the rates decrease. This also protects you from an increased rent, as the mortgage amount will not rise after closing when using a locked-in interest rate on your loan. There are still programs available to help with homestead purchasers with money down and for closing costs. Must be eligible for these type of grants, but great to use for first time home buyers or buyers that the purchase will be their only home.
Another large change I have seen in my seller’s listed properties and when working with buyers is the number of offers. In the past year there would be very many offers on a property on the first day listed and one accepted within 24 hours. We are now seeing offers being accepted on the second and third day for a hot listing that is priced right, and less amount of offers.
Closing Costs are still not being paid by sellers typically. In a healthier market, sellers often contribute or agree to pay at least some of a buyers costs for closing. (Not to be confused with down payment.) In our current market buyers must have money saved for both down payment and their own closing costs.
Foreclosures are not often coming to market. The ones I am seeing come available, appear to be mainly reverse mortgage sales or homes that were not repaired after Hurricane Michael.
Condemn homes are coming on the market, these are as sellers are receiving notices they must repair/demolish or the City will do so for them and add a lien. Some of these condemns do have liens and the liens are paid off at closing time of the sale. These homes have many buyers and are cash only, sellers looking for (and in need of) a quick close.
If you are in need of Real Estate assistance for either Buying or Selling please give me a call.
Photo credit to Just Wright Photography