Study after study shows that no matter what generation Americans belong to, the vast majority believe that homeownership is an important part of their American Dream. The benefits of homeownership can be broken into two main categories: financial and non-financial (often referred to as emotional or social reasons.)
For Americans approaching retirement age, one of the greatest benefits to homeownership is the added net worth they have been able to achieve simply by paying their mortgage!
The Joint Center for Housing Studies at Harvard University focused on homeowners and renters over the age of 65. Their study revealed that the difference in net worth between homeowners and renters at this age group was actually 47.5 times greater, with nearly half their net worth coming from home equity!
Homeowners over the age of 65 are much more financially prepared for retirement and often own their homes outright if they were fortunate enough to purchase their homes before the age of 36.
Their 30 years of mortgage payments have paid off as they gained equity through their monthly payments and as home values appreciated.
It is no surprise that lifelong renters have had a hard time accruing net worth as the latest Census report shows that the Median Asking Rent has been climbing consistently over the last 30 years.
Your monthly mortgage payment is a form of ‘forced savings’ building your net worth with every payment!
It is common knowledge that a great number of homes sell during the spring buying season. For that reason, many homeowners hold off putting their homes on the market until then. The question is whether or not that is a good strategy this year.
The other listings that come out in the spring will represent increased competition to any seller. Do a greater number of homes actually come to the market during this season in comparison to the rest of the year? The National Association of Realtors (NAR) recently revealed the months during which most people listed their homes for sale in 2018. This graphic shows the results:
The three months in the second quarter of the year are consistently the most popular months for sellers to list their homes on the market. Last year, the number of homes available for sale in January was 1,520,000.
That number spiked to 1,870,000 by May!
What does this mean to you?
With the national job situation improving and mortgage interest rates projected to rise later in the year, buyers are not waiting until the spring; they are out looking for homes right now.
If you are looking to sell this year, waiting until the spring to list your home means you will have the greatest competition amongst buyers. Beat the rush of housing inventory that will enter the market and list your home today!
Think of making a move (or know someone that is)? Call me today to start a conversation
Want to sell your home in 2019 but now sure when is the best time? Actually, now is the best time and here is why:
• On average, more properties come on the market during April-June. If you can, avoid listing your property during these months because when selling your home, competition is not your friend. The more choices buyers have, the more they will negotiate to lower your price and/or get you to make more costly repairs on your house. Buyers are also more willing to walk away from negotiations if they don’t get their desired price because they know there are other properties to choose from.
• Right now there are buyers eager to become homeowners before interest rates go up and they projected to go up incrementally each quarter of 2019. Since inventory is still somewhat low right now, buyers are less willing to walk away from a transaction.
• If you are going to wait to sell your property at the end of the year to make more money, if you buy another property after the sale of your home, that future home is going to cost more at the end of the year than it would cost now.
• Since interest are predicted to go up, there will be fewer buyers able to purchase your home as the year progresses. The fewer buyers for your home, the less likely buyers will compete against each other to buy your home for top dollar.
If you’re thinking of making a move, call me today to start a conversation…
Click the link below to get your Free E-Book “Things To Consider When Selling Your House In Winter”!!
1) interest rates are still low (below 5%), however they are likely to rise in 2019 and homebuyers looking to get the lowest rate possible will try to make a deal sooner than later.
2) You have high equity! If you bought your home before 2015, you likely have lots of equity which you can use for a huge down payment on another home or buy a home all cash in another state.
3) New buyers are still entering the market as interest rates rise. Some buyers will lose interest in purchasing, so be ready to see occasional drops in buyer activity, however with the housing inventory remaining low, even with the rising interest rates, buyers who are ready to make a purchase will still shop for homes.
4) Selling in 2019 vs 2020. If not selling your home in 2019 means putting your home on the market in 2020, the sooner option is the best one. In a survey of economists and real estate experts by Zillow, 50% expect a recession to occur in 2020 and 24% expect a recession to occur in 2019.
Bottom Line: Real estate markets are cyclical and current patterns indicate a sudden upswing of home buying activity or prices is unlikely in the near future (Source: yahoo finance)