People have asked me if this is a good time to sell their home. A little historical background -- about the typical phases of a real estate cycle, and supply and demand – helps provide the answer.
1995 – 2005 Available financing combined with a limited housing inventory bumped up home prices. It was a “seller’s market,” with more demand for homes than inventory of homes, and thus a terrific time to sell. Competing bids on a property were not uncommon, and unit sales were high.
2006 – 2008 The market did what all markets do: slowly began to correct itself. Prices remained high, still riding that speeding train, but as the economy slowed and financing became more restrictive, demand lessened. Thus, unit sales were falling and housing inventory increasing. This real estate market correction took a precipitous drop in 2008, when Wall Street’s Three Card Monty caused a credit crunch which some say resulted in a great recession.
2008 – 2011 Unit sales continued to decrease. Prices also declined. With housing inventory still increasing, this was a “buyer’s market.” Of course, not everyone could buy a home during this time. Consumer confidence was low, unemployment high, and for those who remained employed, job security was a concern. I began my career in real estate during this time, and strove to help people during what was, for some, a difficult moment in their lives. Their resiliency and positive outlook impressed me.
2011 – Present And speaking of resiliency… Our real estate market improved as the U.S. and world economies improved. We see-sawed down, and now since 2011, are solidly on our way back up. Home buyers -- bolstered by a stabilizing economy, historically low mortgage interest rates, and low home prices – have reappeared in force. Unit sales are increasing, and as housing inventory continues to decrease, home prices are starting to rise. In certain price points, homes are going to competing bids. We realtors see strong “pent up demand” from prospective buyers, still aided by the low interest rates which many economists believe will hold until 2015. All indicators point the way to a strong and healthy real estate market.
So, is it a good time to sell your home? I believe the answer is “Yes,” if you’re ready. In a future column, we’ll talk about preparing your home for sale. In the meantime, please be in touch if I can be of help.
Megan McCarthy, a licensed real estate salesperson with Coldwell Banker Residential Brokerage in Larchmont, may be reached by email: email@example.com or by cellphone: 914-309-4648