Here are a few things to know about the real estate market as we head into spring.
It should be a great season.
Selling your Greater Washington DC area home?
Buying an Greater Washington DC area home?
Each year, spring is the hottest season for real estate. However, spring 2018 looks to be an especially important time for anyone looking to sell a home. Here are a few facts to get you thinking:
1. Demand continues to outstrip supply. The number of homes on the market is near an all-time low, and listings of existing homes have plunged 8.1% over the past year. While this means that the total number of sold homes has actually decreased, demand continues to be strong.
2. Home prices are still surging. Home prices are up 6.3% year over year in the last quarter for which we have data. It's not just Northern Virginia that's doing well — areas around the country keep posting record highs for home values.
3. Mortgage rates are finally rising. The Fed increased its benchmark rate several times over the past year, but this did not translate to an immediate increase in mortgage rates. However, mortgage rates do seem to be finally responding, and the 30-year fixed rate is now hovering around 4.5.%. While this is a four-year high, it is still near historical lows, and makes mortgages affordable to would-be buyers.
It’s not clear how long this favorable situation will last.
Put together, what do these facts mean if you are considering selling your home?
First off, they mean that right now is a very good time to sell. That's because of the strong demand and the high level of current prices. In other words, if you were to put your home on the market right now, you could get top dollar, and you would be able to sell quickly and without hassle.
Second, it's not clear how long this favorable situation will last. As I mentioned, mortgage rates are on the rise. Currently, that is not enough to dampen demand. But if rates continue to rise, it might drive more buyers out of the market, eventually driving down prices and making it more difficult to sell your home.
Another thing to consider is the effect of the new tax plan. It's not entirely clear how it will affect the real estate market, but odds are good it will make home buying more expensive. That's because of a new cap on state and local tax deductions, which could combine with higher mortgage rates to push more buyers out of the market.
To sum up, if you have been considering selling your home, consider selling now. The current moment is very favorable, but it won’t last forever. If you have any questions for me about how to get started buying or selling a home, don’t hesitate to reach out and give us a call at 703-328-3434 or send us an email to Janet@TheGreshGroup.com. We look forward to hearing from you soon.
