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Sellers: Don’t Let These Two Things Hold You Back

GARY KIRKPATRICK August 8, 2023

Sellers: Don’t Let These Two Things Hold You Back

 

Many homeowners thinking about selling have two key things holding them back. That’s feeling locked in by today’s higher mortgage rates and worrying they won’t be able to find something to buy while supply is so low. Let’s dive into each challenge and give you some helpful advice on how to overcome these obstacles.

 

Challenge #1: The Reluctance to Take on a Higher Mortgage Rate

According to the Federal Housing Finance Agency (FHFA), the average interest rate for current homeowners with mortgages is less than 4% (see graph below):

But today, the typical 30-year fixed mortgage rate offered to buyers is closer to 7%.

 

As a result, many homeowners are opting to stay put instead of moving to another home with a higher borrowing cost. This is a situation known as the mortgage rate lock-in effect.

 

The Advice: Waiting May Not Pay Off

While experts project mortgage rates will gradually fall this year as inflation cools, that doesn’t necessarily mean you should wait to sell. Mortgage rates are notoriously hard to predict. And, right now home prices are back on the rise. If you move now, you’ll at least beat rising home prices when you buy your next home. And, if experts are right and rates fall, you can always refinance later if that happens (and benefit by your home value increasing as the lower rates cause a climb in prices).

 

Challenge #2: The Fear of Not Finding Something to Buy

When so many homeowners are reluctant to take on a higher rate, fewer homes are going to come onto the market. That’s going to keep inventory low. As Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), explains:

 

“Inventory will remain tight in the coming months and even for the next couple of years. Some homeowners are unwilling to trade up or trade down after locking in historically-low mortgage rates in recent years.”

 

Even though you know this limited housing supply helps your house stand out to eager buyers, it may also make you feel hesitant to sell because you don’t want to struggle to find something to purchase.

 

The Advice: Broaden Your Search

If fear you won’t be able to find your next home is the primary thing holding you back, remember to consider all your options. Looking at all housing types including condos, townhouses, and even newly built homes can help give you more to choose from. Plus, if you’re able to work fully remote or hybrid, you may be able to consider areas you hadn’t previously searched. If you can look further from your place of work, you may have more options.

Lean on a Professional’s Expertise to Price Your House Right

 

So why is a professional agent essential in finding the right price? A local agent has the skill and the insight necessary to find the market value of your home.

We'll use our expertise to determine a realistic listing price by assessing:

  • The prices of recently sold homes
  • The current market conditions
  • The size and condition of your house
  • The location of your house
  • The upgrades/repairs made to your home vs recently sold and competition

If you would like to know what your home could sell for OR would like to purchase property to enjoy the potential benefits, we would love to talk with you.

We will continue keeping you up-to-date on the market.

 

Sincerley,

Gary

KIRPATRICK ASSOCIATES LLC

 

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Gary and his team focus on his commitment to providing their clients with first class, 5 star service, before, during and after the transaction.