Why 2021 Is Still The Year To Seller You Home

Lately, it’s been all about buyers in this crazy housing market and how that’s affecting them. Today I want to refocus the conversation to the seller side and what the market looks like for the rest of 2021.

To begin we have to ask ourselves “what is the overall feelings that consumers are having on either side?” And right now, we know from previous posts that buyers are now sour on the market. In the past year, it went from 65% thinking it was a good time to buy down to 35% think it’s a good time to buy.

Conversely, we are looking at seller sentiment now. Last year in July, 45% of sellers said it was a good time to sell. Now it’s at 75% of home sellers thinking that it’s a good time to sell. So the sentiment on both sides has changed. And why is that important? Because if the desire on the buyer side is waning and the desire on the seller side is increasing, that is going to play into the numbers in the overall market. And the most important numbers that are going to change as a result is the supply.

As you can see above supply hit its low in January 2021. We had ultra low supply across the board in the country and it showed throughout this year. We’ve seen double digit increases in appreciation, ridiculous numbers. Now the supply issue has monthly gone down, so we’re looking at less and less supply issues. In fact, late in the summer here, we’re looking at a little bit more supply than we saw throughout the year, including San Antonio. San Antonio is one of those areas I call ultra low on supply, but even in San Antonio, if you look at last month’s housing market report for August, saw an increase in supply.

So little by little things are changing. The sentiment has changed on the buyer side and the seller side, and the actual supply piece has changed on both sides. What’s missing? The next piece that’s missing is interest rates, and experts all agree that interest rates are going to be higher. Why does that matter to sellers you might ask? The seller is not paying the interest. The buyer’s paying the interest.

However, with home prices going up and interest rates scheduled to increase or predicted rather to increase the amount of home that the buyers can afford is going to decrease. So if you have a home that is at a very high value, especially in those areas where price increases have begun to stall out, and rather you’re starting to see more price changes because people were pricing their homes ahead of the market, you may be out of runway for more the same amount of appreciation. Wages just can’t handle it forever.

So look at that in your own situation. And then let’s look at what Danielle Hale, chief economist for Realtor.com has to say about the situation.

“More homeowners continue to list homes for sale compared to a year ago… Notably, while new listings continue to lag behind a more ‘normal’ 2019 pace, the gap is shrinking. Even though homes continue to sell quickly thanks to high demand and limited supply, new listings are subtly shifting the balance of market conditions in favor of buyers.” 

Danielle Hale chief economist for Realtor.com

So we’re not in a buyers market yet. I don’t know that we’re going to be in a buyer’s market anytime soon, next year or even the following year. In fact, the experts all agree that we’re going to continue to see appreciation, not in the double digit numbers, potentially in about the 5% range next year, and then lower the next few years, all the way up through 2026. But that right now is what the experts do agree on, that the wild appreciation ride is pretty much over.

So what does this mean for you

If you’ve been waiting for the perfect time to sell, there may not be a better chance than right now. Inventory is gradually increasing each month, so selling sooner rather than later will help you maximize your home’s potential.

Bottom Line

If you’re planning to sell your house, 2021 is still the year to do it. The unique mix of low supply and high demand won’t last forever. Let’s connect to discuss what you need to do now to sell your house and take advantage of this sellers’ market.