Three Reasons to Sell Your Home in 2016

 
 

Is one of your New Year's resolutions for 2016 to put your home up for sale? If it isn't, then maybe it should be.

Just kidding.

We're not ones to pressure people into doing things that may not be right for them. However, if selling your home this year is at all on your radar of possible "to do" items, then let's chat about some things you might consider to help you make that decision.

In other words, let's see if we can answer this question: "Should I sell my home this year?"

Here are three reasons why it might be time.

Historically Low Inventory

One of the frequent headlines for Portland area real estate over the last 3 years has been a dwindling supply of available homes for sale into historically low territory. In fact, our current inventory of homes for sale hasn't been this low in 16 years.

16 years!

When you think about how many buyers are currently searching for and purchasing homes, and how many homes those buyers have to choose from, the numbers are bleak. Looking back at December, inventory was at just a 1.2-month supply. This means that if no new homes were to come on the market, all homes for sale would have been sold and gone within just a hair over a 1-month period. That's just downright depressing news for a buyer; for a seller, it's fantastic news.

So what does this level of historically low inventory mean if you're thinking of selling your home?

Rising home prices.

Rising Prices

The other oft-used headline for Portland area real estate, as well as much of the nation, has been rising home prices. In just the last 3 years alone, Portland area home prices have risen more than 22%.

Rising home prices is simply a function of supply and demand. When supply is low and demand is high, prices move upward simply because buyers are willing to pay more for that high demand item.

Portland area home prices are forecasted to continue that upward climb. There will continue to be some leveling off as we see more homeowners put their homes up for sale, and as interest rates increase, but the general trajectory for Portland area home prices will continue upward.

Rising Interest Rates

Interest rates to borrow money to purchase a home (otherwise known as a mortgage) rose in 2015 off the lowest rates we've ever seen and will likely continue to do so in 2016, even if only by half a percentage point or so. Higher interest rates mean higher mortgage payments for buyers, which means that houses become less affordable as rates rise. The net effect is that buyers who could afford to buy your home now, may not be able to do so later when interest rates are higher. If you're thinking of selling your home this year and you'll need to purchase a home as a replacement, this applies to you, as a seller, as well, so you'll need to consider what effect higher interest rates might have on your ability to purchase once your home sells.

Conclusion: It's a Seller's Market

Objectively, Portland area real estate is in what we call a "seller's market," which means that market conditions currently favor people who are selling their homes, not buying them. If we think about this in terms of negotiating power, it's the sellers who have the power - and all of the negotiating leverage that comes with it - in the current market.

Still, that doesn't necessarily mean that you should sell your home this year. That's a highly personal decision that depends on a lot of factors outside of what actual market conditions look like for Portland area real estate.

So here's our answer to the question, "Should I sell my home this year?"

If it makes sense for you - personally and financially - to make the move, then objectively (i.e., using the best data available to us), it is indeed a great time to sell your home this year. As a homeowner looking to sell your home, you can leverage the Portland area's historically low inventory, rising home prices and the anticipated rise in interest rates to your advantage this year in a market where homeowners are often selling their homes in just a matter of days of hitting the market, with multiple offers from multiple buyers and final sales prices that are above the initial asking price.

Thinking of selling your home this year? Give us a call today, and we'll be happy to chat with you, with no obligation at all to work with us.