Low Supply Causes Sellers To Pause
Lately, it seems as if homeowners have gone on strike. We currently have the lowest inventory since the last boom, which is just shy of a decade. It is safe to say, the market is back! With people moving to the Pacific Northwest from all over the world, I have no doubt in my mind that we will be the next Bay Area. Why is this happening, and what will it take to bring more houses on the market for our high demand market?
It is a vicious cycle of sellers wanting to pull the trigger, but having no idea where they will go. I’m going to address how you can sell your home successfully without worrying where you are going next. My first advice is to take it one step at a time, and do not jump ahead.
1. Negotiate a Longer Closing Time
For starters, you can take advantage of being in the driver’s seat because most banks give buyers sixty days to move into their new home. You can also ask your Realtor to extend the closing for two months. This will give you time to find another house, and if you do not find one during that timeframe, it is best to have a backup plan where you would stay in temporary housing. It is essential to always have a backup plan, and your Real Estate Broker should be working with you on different strategies.
2. Equity Line of Credit
If you want to find your next home first before you sell your current house, you could talk to your lender about taking out an equity line of credit for your down payment. Once this is secured, you can take your time finding a house, knowing your current house will sell quickly. The caveat is that you must take out the equity line before you put your house up for sale as lenders will not give you a loan if you are trying to sell your house.
3. Use One Realtor
It is best practices to use one Real Estate Broker to sell your home, and to purchase your next home. When you use one broker you are streamlining the communication process, and overall understanding of your personal goals, timelines, and deadlines. Having to communicate all of this twice is simply adding more stress to an already very stressful process. Bottomline, hire someone who is truly excellent, and more importantly someone who is emotionally trustworthy and who will be professional throughout your transaction.
Having a competent, and reliable team is key!
What Will It Take To Change?
The housing market tends to cycle between shortage and surplus. Therefore, factors that impact supply and demand are interest rates, the economy, and consumer confidence. When interest rates go up, buyers pull back, and ultimately confidence can go down. At this point it will take interest rates to increase, and the economy to slow down in order for this market to shift. Ultimately, this will lead to a transitional market where both buyers and sellers are on an equal playing field.
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