The housing market is rebalancing quickly, so sellers and buyers are finding it challenging to keep up.
According to a new survey of real estate agents, the most common misconception among home buyers is that prices will crash, and the biggest one among sellers is that they’ll keep making quick sales above asking prices.
As many as 46% of agents report that potential buyers believe that home prices will drop, while 35% relay that buyers tend to mistakenly think they should wait for high mortgage rates to fall.
While aspiring buyers believe it’s wiser to wait out the market, the truth is that there are more possibilities in this market than there have been in the last five years (if you approach real estate as a long-term investment).
According to the research, a significant fall in home values is unlikely. It’s actually predicted that home values will flatten over 2023 and the prices will rise by 1.3% by September next year.
In addition, some housing economists think that mortgage rates will rise rather than drop as long as inflationary pressures remain high. Therefore, 44% of agents believe that first-time buyers should secure financing before house hunting.
Some buyers take advantage of the better market conditions today. For example, according to real estate agents, 56% of buyers are taking more time when considering a home, and 55% are making offers below the list price.
According to over 40% of agents, 43% of buyers include incidental future expenses in their offers, like appraisal and inspection, to protect themselves from unexpected costs.
Furthermore, 73% of agents believe that the best seller strategy is to price a home correctly. And this seems logical, as competitively priced homes tend to go under contract in about 19 days, which is 10 days faster than before COVID-19.
On the other hand, non-competitively priced homes typically stay on the market for an average of 54 days.
All in all, according to experts, now is the time to go house shopping, even if your funds are limited.