The spring real estate market can be an excellent time for buying or selling a home, regardless of location. The warmer weather and ease of transportation make open houses and showings easier on all parties after a cold, slow winter. It is also a great season to make a move, so you’ll find more houses on the market during the spring, providing buyers with lots of potential options.
This spring, there are a few things you should be aware of if you are planning to buy or sell a home. World events, inflation rates, and other factors that will impact the market may affect your ability to buy or sell your house quickly.
Rising Mortgage Rates
While there have been some recent fluctuations in mortgage rates, the general trend we have been seeing is an increase in rates over the past six months. Freddie Mac reports that the 30-year fixed mortgage rate recently broke four percent for the first time since May 2019 and predicted that it will continue to rise through the end of the year due to the Federal Reserve raising short-term rates.
This is important for first-time homebuyers or sellers considering purchasing a new home. While mortgage rates are high right now, waiting to purchase will likely result in a higher mortgage rate. This rate impacts your monthly payment for the full terms of your mortgage, which can add up to a substantial amount over time.
Increase in Available Homes
Recent trends reported by Realtor.com have shown an increase in the number of homes on the market for the past two months in a row. This is common for spring, as it is more conducive to home buying and selling, as well as moving. The next 60-90 days should continue to see an increase in the number of homes available on the market.
As a buyer, this can be a massive advantage for you. Winter is often a slow time with limited options, but you should soon see many more homes available in your area. If you are looking for something specific, this may be the time you finally find it. When you find a home you love, it is important to act quickly to secure it, as many other buyers are likely to bid against you.
As a seller, you want to list your home as soon as possible to get ahead of the increase in available inventory that is coming. Closing on a sale sooner rather than later will most likely mean a higher price and less negotiation. As more homes appear on the market, buyers have more power to walk away or negotiate down your price.
Climbing House Prices
Like anything else in the economy, home prices are driven by supply and demand. While the number of available houses may be increasing, the demand for houses is also holding firm. Realtor.com recently released a Housing Report for February 2022, stating that even though more new sellers came into the market, there were still 24.5% fewer active listings during the period compared to this time last year. They reported that the available number of homes on the market “remains woefully behind buyer demand.”
As demand continues to exceed demand, home prices continue to rise. Experts do not expect the same level of appreciation we have seen for the past two years but still predict a moderate pace of growth. If you are in the market to buy, it may be in your best interest to act quickly.
What Does This Mean for You?
Regardless of your situation, it may be best to act quickly as we move into the upcoming spring season. Buyers that are currently looking for a new home should move fast and secure a new house before the mortgage and home prices rise even further. Sellers may want to offload their homes quickly before the inventory of homes in their areas grows too large to be noticed.