Selling Your House? Your Asking Price Matters More Now Than Ever

21042 Robin Ave, Bend, OR 97703
Presented by Nicolette Rice | Offered at $1,195,000 | MLS# 220144075

From Keeping Current Matters

There’s no doubt about the fact that the housing market is slowing from the frenzy we saw over the past two years. But what does that mean for you if you’re thinking of selling your house?

While home prices are still appreciating in most markets and experts say that will continue, they’re climbing at a slower pace because rising mortgage rates are creating less buyer demand. Because of this, there are more homes on the market. And in a shift like this one, the way you price your home matters more than ever.

Why Today’s Housing Market Is Different

During the pandemic, sellers could price their homes higher because demand was so high, and supply was so low. This year, things are shifting, and that means your approach to pricing your house needs to shift too.

Because we’re seeing less buyer demand, sellers have to recognize this is a different market than it was during the pandemic. Here’s what’s at stake if you don’t.

Why Pricing Your House at Market Value Matters

The price you set for your house sends a message to potential buyers. If you price it too high, you run the risk of deterring buyers.

When that happens, you may have to lower the price to try to reignite interest in your house when it sits on the market for a while. But be aware that a price drop can be seen as a red flag for some buyers who will wonder what that means about the home or if in fact it’s still overpriced. Some sellers aren’t adjusting their expectations to today’s market, and realtor.com explains the impact that’s having:

“. . . the share of listings with a price cut was nearly double its year ago level even as it remains well below pre-pandemic levels.”

To avoid the headache of having to lower your price, you’ll want to price it right from the onset. A real estate advisor knows how to determine that perfect asking price. To find the right price, they balance the value of homes in your neighborhood, current market trends and buyer demand, the condition of your house, and more.

Not to mention, pricing your house fairly based on market conditions increases the chance you’ll have more buyers who are interested in purchasing it. This helps lead to stronger offers and a greater likelihood it’ll sell quickly.

Why You Still Have an Opportunity When You Sell Today

Rest assured, it’s still a sellers’ market, and you’ll still get great benefits if you plan accordingly and work with an agent to set your price at the current market value. As Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), says:

“Homes priced right are selling very quickly, but homes priced too high are deterring prospective buyers.”

Mike Simonsen, the Founder and CEO of Altos Research, also notes:

“We can see that demand is still there for the homes that are priced properly.”

Full article on Keeping Current Matters


Mortgage Rates Dip Below 5%; Buyers Get ‘A Second-Chance Opportunity’

13250 NW Willis Rd, McMinnville, OR 97128
Presented by Dennis Coxen | Offered at $2,100,000 | MLS# 22214974

From REALTOR® Magazine

After weeks of escalating borrowing costs, home buyers are getting a second chance to lock in lower rates. The 30-year fixed-rate mortgage fell to an average just below 5% for the week ending Aug. 4, Freddie Mac reports.

With rates dipping in recent days, mortgage applications are increasing for the first time in five weeks, the Mortgage Bankers Association reported this week. Applications for a home purchase increased 1% last week following weeks of declines as home buyers and refinancers got spooked by higher mortgage rates.

Will the latest lower rates stick around? “Mortgage rates remained volatile due to the tug of war between inflationary pressures and a clear slowdown in economic growth,” says Sam Khater, Freddie Mac’s chief economist. “The high uncertainty surrounding inflation and other factors will likely cause rates to remain variable, especially as the Federal Reserve attempts to navigate the current economic environment.”

Last week, National Association of REALTORS® Chief Economist Lawrence Yun predicted that the Federal Reserve’s decision to raise its short-term fed funds rate by 75 basis points was unlikely to do any further damage to mortgage rates. “The mortgage and longer-term bond markets have settled down in recent weeks,” Yun says. “The peak in mortgage rates may have already occurred. That’s because oil and gasoline prices have been falling lately and, hence, will lessen broader inflationary pressures. Lower inflation means less aggressive interest rates by the Federal Reserve.”

Any decline in mortgage rates is likely relief to potential home buyers. “Though still higher than a year ago, the current rate of under 5% means around a 12% reduction in monthly payments compared to when mortgage rates peaked at 6% just two months ago,” Yun says. “Mortgage rates could soon turn upward but are unlikely to retouch the 6% mark. Any dip should be viewed as a second-chance opportunity.”

Freddie Mac reports the following national averages with mortgage rates for the week ending Aug. 4:

  • 30-year fixed-rate mortgages: averaged 4.99%, with an average 0.8 point, dropping from last week’s 5.30% average. Last year at this time, 30-year rates averaged 2.77%.
  • 15-year fixed-rate mortgages: averaged 4.26%, with an average 0.6 point, falling from last week’s 4.58% average. A year ago, 15-year rates averaged 2.10%.
  • 5-year hybrid adjustable-rate mortgages: averaged 4.25%, with an average 0.3 point, dropping from last week’s 4.29% average. A year ago, 5-year ARMs averaged 2.40%.

Freddie Mac reports commitment rates along with average points to better reflect the total upfront cost of obtaining the mortgage.

Full article on REALTOR® Magazine


Housing Inventory Nationwide Rises for the First Time in Years

5924 SW Cupola Dr, South Beach, OR 97366
Presented by Jack Winter | Offered at $1,049,000 | MLS# 22-1432

From housingwire.com

Fast-rising home prices and interest rates coupled with a slipping economy helped to cool the nation’s housing market in June leading to a nearly 2% increase in the number of homes on the market. That marks the first month since July 2019 (pre-pandemic) that housing inventory increased year over year.

The home-inventory bump dovetails with other data indicating the nation’s housing market lost some steam this past month, according to a June housing-market report from Seattle-based Redfin. The median home-sale price nationwide did rise 11.2% in June, but that’s the smallest year-over-year increase in about two years, the report notes.

San Francisco actually posted a home-price decrease of 0.5%, turning in a $1,581,000 median sale price for June. (North Port, Florida, posted the highest growth in home prices, at 29.7% year over year as of June, to $480,000.)

Home sales for June declined by nearly 16% year over year in June, the Redfin report shows, “the largest decline since May 2020.”

“The country’s economic woes have already cooled the housing market, and they’re likely to continue dampening demand,” said Redfin Chief Economist Daryl Fairweather. “… I advise sellers to commit: If you decide to sell, do it quickly before demand potentially falls further.

“And price carefully. This is not the time to test the waters. You’ll do more harm than good if you overprice and have to do a price reduction or take the home off the market.”

The Redfin report notes that the market is now a mix of good and bad for homebuyers, who are seeing higher monthly payments than earlier this year due to the spike in interest rates — averaging 5.52% for a 30-year fixed mortgage in June, the report shows. At the same time, homebuyers are facing less competition as home inventory starts to bump up slightly.

The dip in competition often allows homebuyers to make less risky offers that avoid waiving protections like home inspections and appraisal contingencies.

Highlights from the June report include the following:

  • Total homes sold for the month of June came in at 524,200, a 15.5% year-over-year decline.
  • Pending home sales in June stood at 500,000, a 12.6% drop from a year earlier.
  • New home listings also were down 4.4% year-over-year in June, at 636,500.
  • Total homes for sale in June stood at 1,450,900, up 1.8% year over year.
  • Median days on the market jumped from three to 18 year over year as of June while months of housing supply also was up over the period, from 0.5 to 1.7 months.
  • The volume of homes sold above list price in June stood at 55.5%, down 0.9 percentage points from June 2021.

Full article at housingwire.com


Think Home Prices Are Going To Fall? Think Again

5205 NW 141st St, Vancouver, WA 98685
Presented by Marci Caputo & Mark Long | Offered at $1,100,000 | MLS# 22436969

From Keeping Current Matters

Over the last two years, the rate of home prices appreciated at a dramatic pace. While that led to incredible equity gains for homeowners, it’s also caused some buyers to wonder if home prices will fall. It’s important to know the housing market isn’t a bubble about to burst, and home price growth is supported by strong market fundamentals.

To understand why price declines are unlikely, it’s important to explore what caused home prices to rise so much recently, and where experts say home prices are headed. Here’s what you need to know.

Home Prices Rose Significantly in Recent Years

The graph below uses the latest data from CoreLogic to illustrate the rise in home prices over the past year and a half. The gray bars represent the dramatic increase in the rate of home price appreciation in 2021. The blue bars show home prices are still rising in 2022, but not as quickly:

You might be asking: why did home prices climb so much last year? It’s because there were more buyers than there were homes for sale. That imbalance put upward pressure on home prices because demand was extremely high, and supply was record low.

Where Experts Say Prices Will Go from Here

While housing inventory is increasing and buyer demand is softening today, there’s still a shortage of homes available for sale. That’s why the market is seeing ongoing price appreciation. Mark Fleming, Chief Economist at First American, explains it like this:

“. . .we’re still well below normal levels of inventory and that’s why even with the pullback in demand, we still see house prices appreciating. While there is more inventory, it’s still not enough.”

As a result, experts are projecting a more moderate rate of home price appreciation this year, which means home prices will continue rising, but at a slower pace. That doesn’t mean prices are going to fall. As Selma Hepp, Deputy Chief Economist at CoreLogic, says:

“The current home price growth rate is unsustainable, and higher mortgage rates coupled with more inventory will lead to slower home price growth but unlikely declines in home prices.”

In other words, even with higher mortgage rates, moderating buyer demand, and more homes for sale, experts say home price appreciation will slow, but prices won’t decline.

If you’re planning to buy a home, that means you shouldn’t wait for home prices to drop to make your purchase. Instead, buying today means you can get ahead of future price increases, and benefit from the rise in prices in the form of home equity.

Full article on Keeping Current Matters


Housing Inventory Continues To Grow Even As New Listings Dip

1579 Fir Crest Rd, Mosier, OR 97040
Presented by England Property Group | Offered at $1,895,000 | MLS# 22429678

From Forbes

The week ending July 9 saw active inventory in the housing market continue to grow at a double-digit annual pace, even as new sellers took a step back from the market around the 4th of July holiday.

“This year’s summer housing markets are feeling the heat of record-high home prices on top of scorching inflation at a 40-year high,” said George Ratiu, senior economist and manager of economic research for Realtor.com. “As households pay much more for cars, clothing, food, gasoline and services, there are fewer dollars left over from each paycheck at a time when housing affordability is a growing challenge.”

For a household with a $75,000 income, only 23% of homes on the market are affordable, down from 50% of inventory in 2018,” said Ratiu. “While these trends are resulting in a cooler summer home buying season than usual, the road ahead points towards a promising shift, away from 2021’s severe undersupply and win-at-all-costs competition. As the Fed continues to fight inflation, borrowing costs will keep rising, cooling demand at a time when we’re seeing more homes for sale. In turn, prices will continue to adjust to a new equilibrium.”

The median listing price advanced by 15.9% over last year, in its 30th consecutive week of double-digit yearly gains. However, listing price growth is moderating, moving below the pace seen in late May and early June. With softening demand and rising supply, Realtor.com expects to see home price growth continue to ease in the second half of 2022.

New listings—a measure of sellers putting homes up for sale—declined 6% from one year ago, reflecting a pullback in seller activity over the Independence Day holiday. Still, more homes have come up for sale this year compared to a year ago in 13 of the last 16 weeks, a trend that is expected to return. Many homeowners are ready to pursue Covid-delayed plans to sell, while capitalizing on still-high prices.

Active inventory continued to grow, rising 28% above one year ago. The shift in supply is due to several weeks of new listings coming online, boosting the inventory level almost a third higher than a year ago. Additionally, houses are also spending longer on the market in many large metro areas, contributing to a boost in homes for sale. The report found that real estate markets remain undersupplied compared with 2019, but they are moving in the right direction.

Homes spent just one day less on the market than this time last year. The pace of transactions is moderating noticeably as higher prices and interest rates take a toll on demand. At this rate, Ratiu said homes will start lingering longer on the market and sellers will have to contend with more competition.

Full article on Forbes


Home Buying Is 5% Cheaper Than a Week Ago

1643 Village Park Ln, Lake Oswego, OR 97034
Presented by Tami Ferrey | Offered at $1,595,000 | MLS# 22699226

From REALTOR® Magazine

Mortgage rates are falling—at least for now—after posting rapid jumps in June. Over the last two weeks, the 30-year fixed-rate mortgage has dropped by one-half of a percentage point. Home buying is about 5% more affordable than a week ago, translating to about $100 less in monthly mortgage payments, economists at the National Association of REALTORS® wrote on the Economists’ Outlook blog.

Rates are dropping as concerns mount over a possible economic recession, says Sam Khater, Freddie Mac’s chief economist. “While the drop provides minor relief to buyers, the housing market will continue to normalize if home price growth materially slows due to the combination of low housing affordability and an expected economic slowdown,” Khater says.

Freddie Mac reports the following national averages with mortgage rates for the week ending July 7:

  • 30-year fixed-rate mortgages: averaged 5.30%, with an average 0.8 point, dropping from last week’s 5.70% average. Last year at this time, 30-year rates averaged 2.90%.
  • 15-year fixed-rate mortgages: averaged 4.45%, with an average 0.8 point, dropping from last week’s 4.83% average. A year ago, 15-year rates averaged 2.20%.
  • 5-year hybrid adjustable-rate mortgages: averaged 4.19%, with an average 0.4 point, falling from last week’s 4.50% average. A year ago, 5-year ARMs averaged 2.52%.

Freddie Mac reports commitment rates along with average points to better reflect the total upfront cost of obtaining the mortgage.

Full article on REALTOR® Magazine