We all realize that the best time to sell anything is when demand for that item is high, and the supply of that item is limited. Two major reports released by the National Association of Realtors (NAR) revealed information that suggests that now is a great time to sell your house.
REALTORS® CONFIDENCE INDEX
Every month, NAR surveys “over 50,000 real estate practitioners about their expectations for home sales, prices and market conditions.” This month, the index showed (again) that homebuying demand continued to outpace the supply of homes available in January.
The map below illustrates buyer demand broken down by state (the darker your state, the stronger demand there is).
In addition to revealing high demand, the index also shows that compared to conditions in the same month last year, seller traffic conditions were ‘weak’ in 22 states, ‘stable’ in 25 states, and ‘strong’ in only 4 states (Alaska, Nevada, North Dakota & Utah).
Takeaway: Demand for housing continues to be strong but supply is struggling to keep up, and this trend is likely to continue throughout 2018.
THE EXISTING HOME SALES REPORT
The most important data revealed in the report was not sales but was instead the inventory of homes for sale (supply). The report explained:
- Total housing inventory rose 4.1% from December to 1.52 million homes available for sale.
- Unsold inventory is 9.5% lower than a year ago, marking the 32nd consecutive month with year-over-year declines.
- This represents a 3.4-month supply at the current sales pace.
According to Lawrence Yun, Chief Economist at NAR:
“Another month of solid price gains underlines this ongoing trend of strong demand and weak supply. The underproduction of single-family homes over the last decade has played a predominant role in the current inventory crisis that is weighing on affordability.”
In real estate, there is a guideline that often applies; when there is less than a 6-month supply of inventory available, we are in a seller’s market and we will see appreciation. Between 6-7 months is a neutral market, where prices will increase at the rate of inflation. More than a 7-month supply means we are in a buyer’s market and should expect depreciation in home values.
As we mentioned before, there is currently a 3.4-month supply, and houses are going under contract fast. The Existing Home Sales Report shows that 43% of properties were on the market for less than a month when sold.
In January, properties sold nationally were typically on the market for 42 days. As Yun notes, this will continue unless more listings come to the market.
“While the good news is that Realtors in most areas are saying buyer traffic is even stronger than the beginning of last year, sales failed to follow course and far lagged last January’s pace. It’s very clear that too many markets right now are becoming less affordable and desperately need more new listings to calm the speedy price growth.”
Takeaway: Inventory of homes for sale is still well below the 6-month supply needed for a normal market and supply will ‘fail to catch up with demand’ if a ‘sizable’ supply does not enter the market.
If you are going to sell, now may be the time to take advantage of the ready, willing, and able buyers that are still out searching for your house.
Bergen County Real Estate Show
The Gibbons Team is proud to present the Bergen County REal estate Show dedicated to educating consumers in the area on the Bergen County real estate market. With tips for homeowners, sellers, and buyers it is is your number 1 resource for buying and selling in Bergen County. us the link below to see all of our episodes.
Bergen County Real Estate
Gibbons Team Real Estate is the premiere real estate team in Bergen County, NJ. Elaine and Ryan Gibbons have decades of experience assisting clients buy and sell here in Bergen County and have many repeat clients. To learn more about the market visit our Bergen County Market Update page. To schedule an appointment contact us at 201-446-8190.
Are you considering selling your Bergen County home? Learn the current value instantly and more with some of the resources provided on our site.
Bergen County Seller Resources
- How Much is Your Bergen County Home Worth?
- Deal Makers for Home Buyers
- How We Sell Homes
- Why Houses Don’t Sell | Gibbons Team Real Estate
- Bergen County Market Update
Bergen County Homes for Sale
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