The market is changing. It’s taking longer to sell homes, there is more negotiation between buyers and sellers, there are more price reductions, inventory is rising, there are fewer showings for any given listing. But the idea that the market is weak or that the market has drastically changed is an overstatement. Price appreciation is still positive, it’s just more gradual than we have been seeing in recent years. We are seeing fewer multiple offer situations resulting in above asking price sales, but the overall negotiation off of list price is just 1.3%. All indicators point to the fact that we are entering a more balanced market.
During the second quarter of 2019 it took on average 33 days for a house to find a buyer. This is ten days longer than it was a year ago. This statistic only includes successful sales, not those who eventually pull their homes from the market. The expected time on the market changes with the price of the home. During the quarter, homes that sold for $500,000 and less went under contract in an average of 30 days. Those priced between $500,000 and $1,000,000 took 34 days. And those priced $1,000,000 and more took 42 days.
Another statistic that I have been watching closely is the percentage of homes that are under contract at the end of a month (top graph this page). I have been tracking this for the past five years and each month in 2019 has been lower than each of the corresponding months since 2015. This shows that there are more choices in the market. You may have been noticing more “for sale” signs in your neighborhood. For me, it means that when I’m showing buyers properties we can see a number of homes at once instead of just one at a time. Having options is definitely a nice thing for buyers. More choices lead to good decisions.
For sellers, it’s important to have realistic expectations. Selling your home for over full price in one day isn’t happening very often these days. Buyers are also very picky in terms of condition and upgrades. Unless your home is ready for a magazine buyers will have a critical eye and may very quickly move on to the next option. Price your home realistically, not the price you wish you could get.
Buyers are feeling more empowered now than at anytime within the last four years. There are choices in the market and they are not feeling the time pressure that comes with multiple offers. As prices continue to rise, albeit more slowly, buyers are feeling affordability pressure. Interest rates continue to remain low and that has been a help in sustaining demand.
Homes continue of sell and as always I’m actively helping buyers and sellers successfully close transactions. I’m always happy to be of service.
Enjoy the report!
Download the PDF The Kearney Report 2nd Quarter 2019
The Kearney Report 2nd Quarter 2019
