Even though you may feel reluctant to sell your house because you don’t want to take on a mortgage rate that’s higher than the one you have now, there’s more to consider. While the financial side of things does matter, your personal needs may actually matter just as much. As an article from Bankrate says:

“Deciding whether it’s the right time to sell your home is a very personal decision. There are numerous important questions to consider, both financial and lifestyle-based, before putting your home on the market.”

So, ask yourself this: why did I want to move in the first place?

Chances are your primary motivation wasn’t just financial in nature. Why you’re really thinking about selling likely has more to do with something changing in your life or a shift in what you need out of your house.

Reasons Homeowners Still Need To Sell Today

Let’s explore some of the most common reasons sellers are moving today. A recent article from Builder Online helps shed light on this. In this research, they identified the following categories:

• Marriage – If you just got married, you may find you either need more space than you currently have, or the two of you want to find a new place you picked out together.
• Divorce – If you’re getting separated or are divorcing your partner, chances are it’ll be difficult to live under the same roof. Selling the place you have, so you can own get your own spot, may be necessary.
• Births – If your household is growing, you may need more square footage, including more bedrooms. If you’re running out of room for everyone, you may not be able to wait to move.
• Deaths – If you’ve recently lost a loved one, it can be hard to spend time in that home. You may need to move for financial reasons or because you no longer need all the space.
• Retirement – If you’re in the process of retiring, or you just did, you may be looking to downsize to cut costs, relocate to be closer to loved ones, or move to a dream location. In this new phase of life, your current home may not be able to deliver what you need. 

You may find you share one of these top motivators. If any of these resonate with you, it may be time to move so you can find a house better suited to your changing needs. A survey from Realtor.com finds other sellers are in the same boat. It says, 1 in 4 sellers are choosing to move for personal reasons, even with current mortgage rates:

“. . . more than half of seller-buyers (56%) who are planning to sell in the next 12 months said they are waiting for rates to come down, while 25% need to sell soon for personal reasons.”

If you need to sell now because something in your own life has changed, don’t let rates hold you back from what you want. You have options to help make that move possible. You can use the equity you already have in your current home toward your next purchase. And with how much equity homeowners have right now, you may be able to finance less than you’d expect, or pay all cash to avoid borrowing at all.

Bottom Line

When you're ready to prioritize your changing needs, let’s connect. You need an expert on your side to help you list your house and find a home that delivers on everything you're looking for.

Some Highlights

• There are only about half the number of homes for sale compared to the last normal years in the market.
• That means buyers don’t have enough options right now. So, if you work with an agent to list your house, it should be in the spotlight.
• If you're thinking of selling, let’s connect so your house can stand out while there’s such a shortage of supply and buyers are craving more options. 

The housing market continues to shift and change, and in a fast-moving landscape like we’re in right now, it’s more important than ever to have a trusted real estate agent on your side. Whether you’re buying your first home or selling once again, it’s mission critical to work with an expert who can guide you through each unique step of the process. 

The reality is, not all agents operate the same way. To truly make a powerful and confident decision as you buy or sell a home, you need a real estate expert who uses their knowledge of what’s really happening with home prices, housing supply, industry projections, and more to give you the best possible advice. Someone who can provide clarity and trust like that is essential to your success. Jay Thompson, Real Estate Industry Consultant, explains:

“Housing market headlines are everywhere. Many are quite sensational, ending with exclamation points or predicting impending doom for the industry. Clickbait, the sensationalizing of headlines and content, has been an issue since the dawn of the internet, and housing news is not immune to it.”

Unfortunately, when information in the media isn’t clear, it can generate a lot of fear and uncertainty for consumers. As Jason Lewris, Co-Founder and Chief Data Officer at Parcl, says:

“In the absence of trustworthy, up-to-date information, real estate decisions are increasingly being driven by fear, uncertainty, and doubt.”

But it doesn’t have to be that way. Buying a home is a big decision, and it should be one you feel confident making. You can lean on an expert to help you separate fact from fiction and get the answers you need.

The right agent can assist you in figuring out what’s going on at the national level and in your local area. They can debunk headlines using data you can trust. Experts have in-depth knowledge of the industry and can provide context, so you know how current trends compare to the normal ebbs and flows in the housing market, historical data, and more.

Then, to make sure you have the full picture, an agent can tell you if your local area is following the national trend or if they’re seeing something different in your market. Together, you can use all that information to make the best possible decision.

After all, making a move is a potentially life-changing milestone. It should be something you feel ready for and excited about. And that’s where a trusted expert comes in.

Bottom Line

If you want sound advice and trusted information about our local housing market, let’s connect.

The National Association of Realtors (NAR) is set to release its most recent Existing Home Sales (EHS) report tomorrow. This monthly release provides information on the volume of sales and price trends for homes that have previously been owned. In the upcoming release, it’ll likely say home prices are down. This may seem a bit confusing, especially if you’ve been following along and reading the blogs saying home prices have hit the bottom and have since rebounded.

So, why would this say home prices are falling when so many other price reports say they’re going back up? It all depends on the methodology of each one. NAR reports on the median home sales price, while some other sources use repeat sales prices. Here’s how those approaches differ.

The Center for Real Estate Studies at Wichita State University explains median sales prices like this:

“The median sale price measures the ‘middle’ price of homes that sold, meaning that half of the homes sold for a higher price and half sold for less . . . For example, if more lower-priced homes have sold recently, the median sale price would decline (because the “middle” home is now a lower-priced home), even if the value of each individual home is rising.”

Investopedia helps define what a repeat sales approach means:

“Repeat-sales methods calculate changes in home prices based on sales of the same property, thereby avoiding the problem of trying to account for price differences in homes with varying characteristics.”

The Challenge with the Median Home Sales Price Today

As the quotes above say, the approaches can tell different stories. That’s why median home sales price data (like EHS) may say prices are down, even though the vast majority of the repeat sales reports show prices are appreciating again.

Bill McBride, Author of the Calculated Risk blog, sums the difference up like this:

“Median prices are distorted by the mix and repeat sales indexes like Case-Shiller and FHFA are probably better for measuring prices.”

To drive this point home, here’s a simple explanation of median value (see visual below). Let’s say you have three coins in your pocket, and you decide to line them up according to their value from low to high. If you have one nickel and two dimes, the median value (the middle one) is 10 cents. If you have two nickels and one dime, the median value is now five cents.

In both cases, a nickel is still worth five cents and a dime is still worth 10 cents. The value of each coin didn’t change.

That’s why using the median home sales price as a gauge of what’s happening with home values may be confusing right now. Most buyers look at home prices as a starting point to determine if they match their budgets. But most people buy homes based on the monthly mortgage payment they can afford, not just the price of the house. When mortgage rates are higher, you may have to buy a less expensive home to keep your monthly housing expense affordable.

That’s why a greater number of ‘less-expensive’ houses are selling right now – and that’s causing the median home sales price to decline. But that doesn’t mean any single house lost value. 

When you see the stories in the media that prices are falling later this week, remember the coins. Just because the median home sales price changes, it doesn’t mean home prices are falling. What it means is the mix of homes being sold is being impacted by affordability and current mortgage rates.

Bottom Line

For a more in-depth understanding of home price trends and reports, let’s connect.

The rising cost of just about everything from groceries to gas right now is leading to speculation that more people won’t be able to afford their mortgage payments. And that’s creating concern that a lot of foreclosures are on the horizon. While it’s true that foreclosure filings have gone up a bit compared to last year, experts say a flood of foreclosures isn’t coming.

Take it from Bill McBride of Calculated Risk. McBride is an expert on the housing market, and after closely following the data and market environment leading up to the crash, he was able to see the foreclosures coming in 2008. With the same careful eye and analysis, he has a different take on what’s ahead in the current market:

“There will not be a foreclosure crisis this time.”

Let’s look at why another flood is so unlikely.

There Aren’t Many Homeowners Who Are Seriously Behind on Their Mortgage Payments

One of the main reasons there were so many foreclosures during the last housing crash was because relaxed lending standards made it easy for people to take out mortgages, even if they couldn't show that they’d be able to pay them back. At that time, lenders weren’t being very strict when assessing applicant credit scores, income levels, employment status, and debt-to-income ratio.

But now, lending standards have tightened, leading to more qualified buyers who can afford to make their mortgage payments. And data from Freddie Mac and Fannie Mae shows the number of homeowners who are seriously behind on their mortgage payments is declining (see graph below):

Molly Boese, Principal Economist at CoreLogic, explains just how few homeowners are struggling to make their mortgage payments:

“May’s overall mortgage delinquency rate matched the all-time low, and serious delinquencies followed suit. Furthermore, the rate of mortgages that were six months or more past due, a measure that ballooned in 2021, has receded to a level last observed in March 2020.”

Before there can be a significant rise in foreclosures, the number of people who can’t make their mortgage payments would need to rise. Since so many buyers are making their payments today, a wave of foreclosures isn’t likely.

Bottom Line

If you’re worried about a potential flood of foreclosures, know there’s nothing in the data today to suggest that’ll happen. In fact, qualified buyers are making their mortgage payments at a very high rate.