The eternal question of whether it’s the right time to buy or sell a home is a recurring favorite among internet searches. The home buying and selling process is complex and buyers/sellers should go into it clear-eyed and focused. Timing the real estate market perfectly is challenging, and the decision to buy or sell should be based on individual circumstances and objectives. Accordingly, it helps to have the answers to some important questions that will undoubtedly be an exciting but potentially stressful journey. Below are the top three questions being asked by both buyers and sellers.
Are prices going to come down? Will the market crash? At the end of the day, no one has a crystal ball to know for certain exactly what the market will do. However, there are specific factors that can help determine what will most likely happen. One factor is that many homeowners are sitting on huge amounts of equity with low interest mortgage loans. This alluring low interest rate is keeping homeowners in their homes and not “moving up” there by changing the traditional home ownership trend. This trend is keeping homeowners in their homes and stifling the supply. Another factor is the shortage of over 5.5 million homes and no new home starts in January that further restricts the supply of homes. These elements all combine to keep the lack of available homes at a consistent shortage. The law of supply and demand in economics should provide both home buyers and sellers with the confidence to decide where the market is headed and why there is no “crash” in the forecast.
Should I wait for interest rates to drop? This is arguably the most important question buyers will want to get correct. Should they wait for rates to drop later this year — as many are already forecasting — or should they act now and just refinance in the future? The answer to this question is a personal one specific to the buyer and their goals and financial situation. There are obvious compelling reasons to both act promptly and wait it out. That said, even if they wait and rates do drop later this year, they’re highly unlikely to drop significantly. Still, a lower rate is a lower rate and every dollar counts, particularly when spread out over decades. Just don’t wait for a huge cut because that’s unlikely to happen.
When is the right time to buyer or sell a home? The California Association of Realtor’s is predicting a 6% rise in appreciation for 2024. Lodi has already seen a 7% increase this year! With both inventory and interest rates remaining low now would seem to be the ideal time to purchase or sell a home. Buyers and sellers can’t afford to wait so long that they priced themself out of the market. Consider balancing the interest rate and the purchase price when making this decision. Sooner would appear to be better than later.