Though many housing experts believe it is still a good time to sell your home, this doesn’t guarantee that your home will sell. Before listing your home, make sure to review the housing market inventory and mortgage interest rates. You should also determine whether you have the funds to sell your property or whether you can pay for any closing costs using your home’s equity.
Selling your house is a big decision. You want to make sure you get the best price for your home and that you sell it at the right time. After all, the real estate market is constantly changing, and waiting even a few months could make a big difference in how much your home sells for. So, should you sell your house now or wait until 2023? This is a question that many homeowners faced during the global economic uncertainty in 2022.
In this post, we’ll look at what the experts have to say. We’ll also provide some tips on determining when is a good time to list your home on the market.
Is now the right time to sell a house?
Most real estate professionals agree that it is still a good time to sell a house, especially with the continued shortage in housing supply and relatively high buyer demand. According to the National Association of Realtors, in July 2022, most properties only stayed on the market for 14 days, down 17 days from the same time last year. Plus, a nationwide survey released in June 2022 by Fannie Mae showed that almost 70% of respondents think selling a home in today’s market is a good idea.
However, there are a lot of factors that come into play when trying to time the perfect sale. For example, you have to consider the condition of the housing market, the state of the economy, and even your personal circumstances. So take the experts’ recommendations with a grain of salt and do your own research before making a decision.
Will mortgage rates continue rising?
When mortgage rates go up, potential home buyers might get discouraged and stop looking for houses altogether. As a seller, this would be bad news.
According to Freddie Mac, the 30-year, fixed-rate mortgage rates have leveled off at around 5.66% as of September 1, 2022. Though this interest rate is almost double the rate of 2.8% a year ago today, it’s still considered normal from a historical perspective. (Before the Federal Reserve started implementing quantitative easing due to the housing market crash in 2008, the mortgage rates rarely dipped below 6%).
Most real estate experts predict that rates will likely settle at around 5% to 6% for the next 12 months. But of course, nobody can 100% predict what will happen with mortgage rates. They could go up, they could go down, or they could stay right where they are. The best thing you can do is keep an eye on the market and be prepared to act when you see a good opportunity.
If you’re looking for a new house to buy, or want to compare what mortgage rates you may qualify for, take a look at the home loan lenders below.
What is the best month to sell a house?
If you’re looking to sell your house quickly, the best time of the year to list your house is in March. But, if you’re hoping to maximize profits, consider selling your house in July instead. It may take a little longer to sell, but it might be worth the wait if you can get a better price.
With that in mind, make sure you don’t wait too long before selling. Zillow found that in 2019, houses sold the fastest between March 11th and March 18th. On the other hand, houses were likelier to sell below the asking price from the 14th to the 21st of October.
However, keep in mind that the best month to sell a house can also depend on your location. For instance, on average it takes longer to sell a house in New York than it does in both Florida and California.
To get a better idea of how long it may take to sell your house, take a look at the chart below. Of course, these averages don’t guarantee your home will sell within a certain timeframe, but at least you’ll know when to reconsider your listing.
When to sell your home
Deciding when to sell your house can be tricky. There are a lot of factors to consider, and it can be tough to make the right call. Nevertheless, there are some scenarios where it may be a good time to take the plunge.
1. The mortgage interest rates are low
Low mortgage rates create a seller’s market because buyer demand is high. And in a hot housing market where there are more buyers than sellers, home prices go up. So if you’re considering selling, this is a good time to do it. You can take advantage of the strong demand and high prices to get top dollar for your home.
2. The housing supply is low
According to the laws of supply and demand, when the supply of a good is low and the demand is high, the price of the good will increase. This principle can be applied to the housing market as well.
When the number of homes for sale is low, and buyers are actively searching for homes, prices will naturally rise. This means prospective buyers are less likely to make lowball offers. As a result, this is the perfect time to sell your home to maximize profits.
3. You need to downsize
A smaller home can make more financial sense than shelling out huge chunks of change for your current home’s mortgage payments and maintenance costs. So if you’re looking to save money, selling your current property and buying a more affordable home may be the way to go.
4. You have positive equity
Equity is the portion of your home’s value that you actually own. So, if your home is worth $200,000 and you owe $150,000 on your mortgage, you have $50,000 in equity. That’s the portion of your home’s value that would be yours to keep if you sold the property today. And if you have significant equity in your home, selling can be a smart move financially.
You can use the profits for a down payment on a new home, investing in a business venture, or funding your child’s education.
Of course, you don’t have to sell your home once you build up enough equity. Depending on the amount of equity you’ve built up, you can take out a home equity loan, a home equity line of credit (HELOC), or get a cash-out refinance. By tapping into your home’s equity, you can pay for a home renovation to increase your home’s value or even buy a car.
Get started by comparing home equity loan, HELOC, and cash-out refinance rates. Be sure to do your research as well by learning how to tap your equity without going into debt and which home equity option is best for you.
When to wait
You finally decide it’s time to sell your house, and you’re eager to get the listing up and find a buyer as soon as possible. But hang on just a second! There are some situations where it might be better to wait before putting that “For Sale” sign in your front yard.
1. You’re not financially ready
Before you list your property, make sure you’re financially ready to handle the costs of selling a house. These include closing costs, origination fees, commission for your real estate agent, and other miscellaneous expenses.
If you’re unsure whether you can afford these costs, it’s best to wait until you’re in a better financial position. In the meantime, you could start making preparations for listing your house, such as decluttering and staging.
2. You just purchased or refinanced the home
If you just purchased or refinanced your home, you probably don’t have much equity in the property. Selling your home in this scenario could mean paying out of pocket to cover the part of the mortgage that the sales price doesn’t cover. So if you’re considering selling your home, it might be best to wait until you have more equity built up.
3. The home is in poor condition
Most potential buyers prefer move-in-ready homes rather than those that require a lot of work. So if you plan on selling your old property, it might be worth waiting until you’ve done the necessary renovations. That way, you can increase your home’s market value and hopefully recoup some of the costs of the repairs.
4. The mortgage rates are rising
Rising mortgage rates often equate to low buyer demand because of the higher cost of financing. This scenario can lead to properties taking longer to sell. And you may have to lower your asking price to attract buyers.
Of course, there are always exceptions to the rule. If your property is in high demand, you might be able to get a good deal despite the rising rates. But generally, it’s best to wait until rates start to level off before listing your home.
Should I sell my house before the market crashes in 2022?
Unfortunately, there’s no way of knowing for sure whether the housing market will crash in 2022. However, there are a few things you can keep an eye on that may give you a clue as to where the market is going. One key indicator is the unemployment rate. If it starts to rise, that could signal that people are less able to afford homes, leading to a decrease in demand.
Additionally, you can pay attention to the supply and demand of the housing market. If more houses are hitting the market than there are buyers, that could indicate that the market might crash. Of course, these are just potential indicators – there’s no crystal ball that shows us how the market will fare in the next few months.
Should I sell my house before a recession?
Yes. Generally speaking, if you’re looking to sell your house, you should avoid doing so in a recession. Typically, during a recession, there are fewer buyers in the market, which can mean that your home can remain on the market for longer than you’d like. Also, home prices tend to stagnate or even decline during a recession, which can eat into your potential profits.
- Though experts agree that 2022 can still be a good time to sell your home, it’s important to do your own research before making a decision.
- Besides the market conditions, whether it’s a good time to sell your property also depends on your personal situation. For example, can you afford the closing costs associated with the home sale?
- No one can say for sure what the housing market will look like in the next few years. However, by paying close attention to market trends and key economic indicators, you’ll be better prepared for whatever the future brings.
Maximize your profits when selling your home
Ultimately, only you can make the decision on when to sell your home. That being said, there are plenty of steps you can take to put yourself in the best situation possible for a fast close.
Regardless of when you list your property, it’s important to work with an experienced real estate agent who knows the current market conditions in your area. That way, you can avoid costly mistakes that could jeopardize the sale of your home.
View Article Sources
- June 2022 Data Release — Fannie Mae
- Existing-Home Sales Retreated 5.9% in July — National Association of Realtors
- What Not to Fix When Selling a House — SuperMoney
- What is the Worst Day to Close on a House? — SuperMoney
- How Long Does It Take to Sell a House? — SuperMoney
- How Often Do Contingent Offers Fall Through? — SuperMoney
- What is Earnest Money and How Much Should I Put Down? — SuperMoney
- Should You Make a Lowball Offer on a House? — SuperMoney
- How to Sell and Buy a House at the Same Time — SuperMoney
- 8 Top Home Selling Mistakes People Often Make — SuperMoney
- How To Buy a House In California — SuperMoney
- What is a Pocket Listing? How Do You Find One and is it Legal? — SuperMoney
- What is a Spec House in Real Estate? — SuperMoney
- The Definitive Guide to Mortgage Rates — SuperMoney
- 2021 Mortgage Industry Study — SuperMoney