The spring season appears to be warming up in housing as more and more buyers enter the market. And after rising mortgage rates sidelined so many buyers last year, that’s a good sign for sellers. Realtor.comhas the latest:
“Spring is officially here, and like green shoots emerging from the bleak winter, new data suggests that more buyers are back in the market, although more subdued compared to a year ago.”
We know buyer activity is trending up because of mortgage purchase application data. According to Investopedia:
“A mortgage application is a document submitted to a lender when you apply for a mortgage to purchase real estate.”
That means the number of mortgage applications shows how many buyers are applying for mortgages. Put another way, an increase in mortgage applications means an increase in buyer demand – and as Joel Kan, VP and Deputy Chief Economist at the Mortgage Bankers Association (MBA), explains, application activity started ramping up as mortgage rates fell steadily in March:
“Application activity increased as mortgage rates declined . . . recent increases, along with data from other sources showing an uptick in home sales, is a welcome development.”
In fact, we can see how mortgage rates have a direct impact on applications over time. As rates rose dramatically last year, applications fell in response (see graph below):
The recent uptick in mortgage applications, as well as the decline in mortgage rates, is good news for sellers because it means more buyers are actively looking for homes.
What This Means for You
Buyers are coming this spring, which is typically the busiest time of the year in real estate. And as Realtor.comtells us, if you’re a seller, you need to prepare:
“If homeowners are planning to sell in 2023, now is the time to get ready.”
The means working with a local real estate agent to maximize your home’s appeal and get it listed at the ideal price for your area.
A lot has changed over the past year, and you might be wondering what’s in store for the spring housing market. If you’re planning to sell your house this season, here’s what real estate experts are saying you should keep in mind.
1. Houses That Are Priced Right Are Still Selling
Houses that are updated and priced at their current market value are still selling. Jeff Tucker, Senior Economist at Zillow, says:
“. . . sellers who price and market their home competitively shouldn’t have a problem finding a buyer.”
The need to price your house right is so important today because the market has changed so much over the past year. Danielle Hale, Chief Economist at realtor.com, explains:
“With a smaller pool of buyers today and more competition from other homes on the market, homesellers will likely need to adjust their price expectations in the market this spring.”
While this spring housing market is different than last year’s, sellers with proper expectations who lean on a real estate expert for the best advice on pricing their house well are still finding success. And that’s great news if you’re thinking about selling.
2. Buyers Are Still Out There
As mortgage rates have risen and remain volatile, some buyers have pressed pause on their plans. But there are still plenty of reasons people are buying homes today. Lisa Sturtevant, Chief Economist at Bright MLS, spells out the mindset of today’s buyers:
“For some buyers, higher mortgage rates simply means buying a home is out of the question unless home prices fall. For others, higher mortgage rates will be a hurdle but ultimately will not keep them from getting back into the market after sitting on the sidelines for months.”
That’s why, if you’re interested in selling your house this spring, it’s helpful to work with a real estate agent who can help connect you with those buyers who are ready to purchase a home.
Bottom Line
There are still clear opportunities for sellers this spring. If you’re wondering if it’s the right time to make a move.
A lot has changed over the past year, and you might be wondering what’s in store for the spring housing market. If you’re planning to sell your house this season, here’s what real estate experts are saying you should keep in mind.
1. Houses That Are Priced Right Are Still Selling
Houses that are updated and priced at their current market value are still selling. Jeff Tucker, Senior Economist at Zillow, says:
“. . . sellers who price and market their home competitively shouldn’t have a problem finding a buyer.”
The need to price your house right is so important today because the market has changed so much over the past year. Danielle Hale, Chief Economist at realtor.com, explains:
“With a smaller pool of buyers today and more competition from other homes on the market, homesellers will likely need to adjust their price expectations in the market this spring.”
While this spring housing market is different than last year’s, sellers with proper expectations who lean on a real estate expert for the best advice on pricing their house well are still finding success. And that’s great news if you’re thinking about selling.
2. Buyers Are Still Out There
As mortgage rates have risen and remain volatile, some buyers have pressed pause on their plans. But there are still plenty of reasons people are buying homes today. Lisa Sturtevant, Chief Economist at Bright MLS, spells out the mindset of today’s buyers:
“For some buyers, higher mortgage rates simply means buying a home is out of the question unless home prices fall. For others, higher mortgage rates will be a hurdle but ultimately will not keep them from getting back into the market after sitting on the sidelines for months.”
That’s why, if you’re interested in selling your house this spring, it’s helpful to work with a real estate agent who can help connect you with those buyers who are ready to purchase a home.
Bottom Line
There are still clear opportunities for sellers this spring. If you’re wondering if it’s the right time to make a move.
Spring is usually the busiest season in the housing market. Many buyers wait until then to make their move, believing it’s the best time to find a home. However, that isn’t always the case when you factor in the competition you could face with other buyers at that time of year. If you’re ready to buy a home, here’s why it makes sense to move before the spring market picks up.
Spring Should Bring a Wave of Buyers to the Market
In most years, the housing market goes through predictable seasonal trends in activity. Winter is typically a quiet point in the year, while spring sees a surge of buyers begin their search. And experts project that this year will be no exception.
Right now, buyer demand is low due to a combination of normal seasonal trends and a reaction to last year’s rise in mortgage rates. But rates have started to come down since last November, which has more and more potential buyers planning to jump into the market. That means right now is a sweet spot if you’re in a good position to buy, before more buyers reappear. Affordability is beginning to improve, but demand is still low — for now. Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), shares:
“. . . expect sales to pick up again soon since mortgage rates have markedly declined after peaking late last year.”
If you’re ready to buy a home, right now is the best time to do so before your competition grows and more buyers enter the market.
Today’s Sellers Are Motivated
Low demand from buyers often means sellers are more motivated to work with you, and that can set you up to buy a home on your terms. In fact, sellers have been more willing to negotiate this winter because there are fewer buyers in the market. According to a recent article from Forbes:
“. . . sellers gave concessions to buyers in 41.9% of home sales in the fourth quarter of last year.”
But keep in mind, the advantages buyers have this winter won’t last forever. The competition you face could be greater if you wait until spring to make a move, and increased buyer demand means sellers will have less motivation to negotiate with you. Be sure to work with a trusted real estate professional to learn what you can expect in your local market right now.
