The simple answer is yes (as of the date of this article 9/1/2022). First, let’s talk about you the seller. From your perspective, there may not be a better time to sell. While in most areas that we serve, prices are not going down appreciably, we are seeing a decrease in the rate of appreciation. Meaning that values are rising more slowly. Which could be a harbinger for the future. So today may be your best opportunity to get top dollar.
Normally in this environment, we expect to see prices begin to fall. But, an interesting dynamic has changed the playing field for everyone (buyers should pay attention to this). You see, unlike during the crash of 2007 when most homeowners owed more than their homes could sell for, today the vast majority of homeowners have substantial equity and simply don’t need to sell. This is coupled with the fact that if you sell today and your current interest rate is in the 2’s and 3’s, you are less likely to want to take on an interest rate in the 5’s or 6’s. So, while we could have expected sellers to rush to market, few have, and few will.
The law of Supply and Demand will dictate that prices should at least hold until buyer demand is less than the inventory available for purchase.
Now, let’s talk about the buyer. Why should they consider buying today? It’s the interest rates baby! For every percentage point that interest rates rise, you lose 12% of your buying power. If prices are not falling you are at serious risk of being priced out of the market!
And, to be clear, MONEY IS STILL ON SALE! Historically, a 30-year fixed mortgage rate has averaged 8-8.5% rate. We have seen it peak in my lifetime at almost 19%. So to be clear, by comparison, today is a good day to buy, so long as you can afford the payment. And, plan on staying for at least 7-10 years.
Every 10 years on average, the market shifts. What we know is that throughout recorded time, real estate values have always bounced higher than they have fallen. So, what this means is that there is never a bad time to buy. There can be a bad time to sell, so make sure that you are comfortable with the payment that you have.
One final thought, Ask the renters today if their landlords are prepared to give them a 30-year fixed rate lease! Certainly, the answer is no. In today’s market, you still would pay more each month to rent the home that you could buy. And, there is no tax write-off for renters. No matter if you rent or own, you are paying a mortgage. The big question is do you want to pay your own or, that of your landlords?
