Are you thinking about selling your home in 2018? If so, there are some things you need to know before you start down the path. Here are three important trends sellers should be aware of in 2018.
1. Home prices continue to rise in most markets.
Home prices across the United States have risen steadily over the last couple of years. While some cities have leveled off a bit, the overall trend has been upward in nature. This is expected to continue in 2018 as well. The economist at Zillow, for example, recently forecast that home prices nationwide would rise by an average of 3.2% over the next 12 months (through November 2018).
What it means to sellers: If you’re planning to sell your home in 2018, you should have an experienced real estate agent help you determine your list price. Chances are, your home’s value has changed since you first purchased it. That’s why it’s important to do a thorough round of research using current sale prices and other market data.
2. Housing inventory is still tight across the country.
According to housing experts, a “balanced” real estate market has around five to six months worth of supply. In November, the country on average had about a three-month supply of homes for sale. That’s well below what is considered to be a balanced market. Some of the tightest markets – like those in the Pacific Northwest – have even less inventory. But this is a trend that applies to most cities across the country.
What it means to sellers: Housing markets with limited inventory tend to favor sellers over buyers. In such a market, there are typically plenty of buyers looking for homes, but not enough properties listed for sale to meet that demand. This gives sellers an advantage when it comes to price negotiation. With that being said, you still have to price your home realistically based on current market conditions. And this is another area where an experienced real estate agent can help you.
3. Loan limits have increased, and the mortgage industry has eased.
Federal housing officials recently increase loan limits for conventional, FHA and VA home loans. This is good news for sellers, because it increases the chance that a buyer can afford to purchase your home. Additionally, there has been some easing within the mortgage industry over the last couple of years. For example, Freddie Mac and Fannie Mae will now purchase home loans with debt-to-income ratios up to 50% (they used to set the bar lower).
These changes will likely result in a more robust mortgage market, with a higher percentage of loans that actually close. This is good news for home buyers and sellers alike.
So there you have them, three important trends a home seller should know about in 2018. Home prices are expected to continue rising, though they could slow down a bit over the coming months. Inventory conditions will likely remain tight in 2018. And it could be easier for some borrowers to qualify for mortgage financing.