While analyzing current market statistics we see September inventory levels rise slightly in select price ranges. Six out of nine price ranges saw an increase in the month’s supply of inventory while five of nine saw an increase in the raw number of listings.
September Inventory Levels Rise Slightly
Four out of nine price ranges saw an increase in the number of sales. In a hot market, you can only sell what you have. As prices increased, some homes graduated to the next price level which increased their inventory, and increased chances of a sale in that price range.
With multiple offers, sometimes we would see a listing in one price range result in a sale in a higher price range because it sold over asking price. For this reason, we must be careful about analyzing the numbers and interpreting what they really mean.
Inventory Still Historically Low
The overall market still stands at less than 1 month supply, which is low. A buyer can assume any listing in any of the price ranges could be receiving multiple offers if they were priced correctly coming to the market. There are some overpriced listings, and no matter how hot the market is, may never sell.
As more listings enter the market, buyers have slightly more choices. The good ones still get swallowed up fast. It is important for buyers to have their ducks in a row before they go shopping.
We monitor the monthly numbers, and we are studying the weekly numbers. We saw a 9-home decrease in the weekly numbers which means more homes came off the market than went on in the last week. Because this market is so hot, we expect volatility in those weekly numbers. It could also be sellers were waiting until after Labor Day to place their home on the market while buyers did not wait.
Interest rates rose slightly in the past week. Rising rates increase the cost of borrowing for buyers. Initially rising rates adds motivation to buyers to purchase before rates go higher. This assumes buyers were sitting on the fence. In our current market it is more likely buyers could not find a home as the winning bid, so they settled for a rental for another year.
Rents are sky high currently. As tenants come off lease we expect them to look to purchase if they can find a home. As the eviction moratorium abates, we expect rent prices could come down.
Eventually rising rates will hurt home buyers. The wildcard will be if home buyers soften due to rising borrowing costs, how does northern buyers relocating here compensate for that? This past year financed buyers were not winning many bids anyway so rising rates would have made no difference. If buyers continue their march to Florida, rising rates might not matter. We will keep our eye on migration patterns.
Is Now a Good Time to Sell?
Many homeowners are contemplating if now might be the time to sell. Prices have risen a good amount, and some are surprised at how much their property is worth. Homeowners also realize we are not likely to see price gains like this going forward. Nobody knows the future and where prices will go. We think it is safe to say prices will not rise 36% in one year again anytime soon.
If you have been wondering if now might be the time to sell, call Brett or Sande Ellis at 239-310-6500 We will be happy to speak with you and discuss your options. Some sellers appreciate our Free and easy home valuation tool where you can see your home’s value online instantly. The system will also email you updates every month so you can track your home’s value going forward. This is great for people who do not want to sell now but are interested in their home’s value.
Good luck and Happy Home Buying and Selling!
See last week’s article “Local Home Sales Highest on Record“