Hello Everyone!The roller-coaster ride in the housing market continues to decline across the state.I know that many sellers are still hanging on to the super high prices from the previous two years
Buyers VS Sellers Who Will Win?
Dated: February 23 2023
Views: 143
Hello Everyone!
The roller-coaster ride in the housing market continues to decline across the state.
I know that many sellers are still hanging on to the super high prices from the previous two years 2020 and 2021, but once the feds raised interest rates back in March of 2022 the market started an immediate trend downward and FAST!
Homes went from 1 to 5 days on the market to weeks in just one month! Now we are seeing on average two to three months for homes to sell, that are not priced right and don’t show well. In fact, there are homes that have been sitting for over five months and more!
KSL posted this housing report on January 14th 2023
The Kem C. Gardner Institute, Dejan Eskic, predicts Utah home prices will drop 9% in 2023. “From peak-to-trough, he expects prices to decline by a percentage somewhere in the mid to low teens, depending on interest rates.”
I think Mr. Gardner is a little more optimistic than what I am currently seeing based off all the price reductions and lower initial listing prices of home that are coming on the market and those homes that have been on the market for over 60 days. My calculations reveal higher price reductions ranging from 15% up to 21% depending upon these factors…
- Location
- Condition
- Improvement (if any)
- Marketing efforts
- Staging/Presentation
If sellers are not getting the right advice and closely adhering to these factors then their changes to getting full value and a timely sell of their home will greatly be hindered.
The Desert News recently published this article on January 24th 2023
Today, the U.S. housing market is going through what Federal Reserve Chairman Jerome Powell has called a “difficult correction” and a “reset” as it comes off the tail end of a pandemic frenzy fueled “housing bubble.”
Are these market “Correction” good or bad?
I think it is both.
The market was running out of qualified buyers do to over inflated home prices and increase prices simply could not continue at the pace it was on. The affordability factor kicked in and buyers said NO MORE!
Right now I am seeing a polarization between buyers and sellers.
Buyers, are very reluctant to purchase a home for fear of rates could go lower, and they don’t want to be stuck with a high mortgage payment which is understandable. However, the answer to that concern is simple, buy now and refinance later if rates go down. But if rates go up then it will not affect their payment.
Problem solved.
Many sellers, are still in the mindset that their homes are worth more do to the past two years of over-priced home values. Problem is that home prices have fallen and will continue to do so as long as the interest rates stay at or above 6%. So, unless sellers are willing to adjust their prices, create value and follow the above recommendations, they will continue to lose value over time. This is what happened in a declining market. Which means statically speaking the longer a home stays on the market the less it is worth.
One more issue to consider.
If mortgage rates move towards 4 to 5% this is what I for-see will happen. Sellers might raise their prices thinking that buyers will jump back into the market and pay more for a home like they were prior to the rate increases. I don’t think that strategy is going to work.
Why?
Buyers, have been burned and are more savvy now with their finances do to economic changes and a market pull back. Buyers are going to take more time to revisit and rethink their position and assets. Therefore, buyers are going to be far more reluctant at making quick and irrational purchases.
Luckily,
My team and I have worked in this industry to provide solutions for both buyers and sellers. We are closing and selling properties all the time by implementing our systems which have been a real blessing for our clients.
I want you to know that I am ALWAYS here to help you with your real estate needs.
Check out my youtube channel for additional topics and current real estate news...
Change is coming... Are you prepared?
Jeff Tomlinson
801.643.4334
Jeff Tomlinson
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All information deemed reliable but not guaranteed. All properties are subject to prior sale, change or withdrawal. Neither listing broker(s) or information provider(s) shall be responsible for any typographical errors, misinformation, misprints and shall be held totally harmless. Listing(s) information is provided for consumer's personal, non-commercial use and may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing. The data relating
