The month of January showed a lot of strength in both the financial markets as well as the real estate markets. Since Christmas Eve, the Stock Market (Nasdaq) has gone up 17.6%. Interest rates have fallen from the highs in Q4 of last year so buyers have recently been more motivated about getting back in the market and purchasing. Buyers are coming back to the market but we are still in a relatively low inventory environment. The current momentum is pointing to a stable market but it's too early to be certain. We will continue to stay on top of the stats and lead indicators to help forecast what maybe coming up. Review our Buyers and Sellers ADVICE section to best position yourself in this transitioning market. Please continue sending us topics of interest so we can cover them in future newsletters. Thank you for reading!
January has been a relatively great start to the New Year. The stock market is up over 17.6% since the recent bottom on Christmas Eve. Interest rates have also fallen compared to where they were in the last quarter of 2018. We are still seeing a lot of volatility in the stock market but Januarys momentum is showing a lot of strength in a positive direction. It'll be interesting to see if this trend continues as earning reports start to get announced and as Q4 housing data starts to trickle in. Don't be surprised when you see articles in the coming weeks of how the last quarter of 2018 was very slow for sales with many price reductions. It's no secret that many buyers put their purchasing plans on pause the past 3-4 months with all the chaos and uncertainty. Signs are showing that buyers have more confidence in the market this month, compared to the last 3-4 months.
January looks to end with many properties going into escrow that were having a slightly harder time selling in 2018. Entry level homes per zip code are getting the most activity but high end homes are also seeing an increase in interest compared to Q4 of last year. Interest rates have also fallen, giving buyers more motivation to make a move now before rates start to climb again. Inventory levels are still very low but anticipate that to increase as we approach the busier spring and summer time months. We are without a doubt transitioning into a new kind of market where we anticipate a more balanced seller and buyer environment. A balanced market is a sustainable market so this is where we want it to be long term. We will continue to monitor the market by analyzing the key indicators to help better prepare all of us for what maybe to come.
ADVICE FOR SELLERS
Sellers have enjoyed tremendous year over year gains for 8+ years now. As the market is now transitioning, seller attitude and mindset also needs to change. As we are no longer in a sellers market, it's critical you price your property right the first time you are on the market. Buyers are much more patient now than they have been in a while. Many buyers we speak to are still waiting for the "crash" so the sense of urgency to buy something ASAP at any cost is no longer there like it was just 12 months ago.
If you have the time and resources, spend the money to make sure your curb appeal is the best it can be. Clean carpets and floors coupled with a fresh coat of paint go a long way and well worth the investment to get top dollar. In times of uncertainty, it's always prudent to go back to the fundamentals. Price your home right, make it look as good as possible, market and negotiate aggressively and you will get the best price for your home. Don't forget, prices are higher today in most zip codes than they have ever been in history. Market is still strong so take advantage of it, if now is the right time for a move.
ADVICE FOR BUYERS
The fundamentals still remain the same if you are a buyer. Make sure you have your finances in order. That's always the first step. No point in looking at homes if you are not certain how much you can afford and what your monthly mortgage will be. Interest rates are still extremely low historically speaking so don't hesitate to lock in a good rate on the right property before rates start to climb again. The feds have said over and over they plan to keep up with the rate increases so these low rates wont last forever.
We are seeing a lot of great opportunities out there for buyers so if you've been on the fence about buying, now is a great time to get back in and see if anything makes sense to purchase. I'm hearing a lot from buyers that "We are waiting for the market to crash to buy something" I can understand that mindset, but what happens if the market doesn't crash? Indicators at the moment are not showing signs of a crash so waiting could cost you a higher interest rate and most importantly, puts your life on hold. If you can afford the monthly payments and want a new home - it's a good idea to look at opportunities now. Lots of great deals out there if you negotiate properly.
The median sale price rose by less than 2 percent in December..
