“How’s the market?” At least 20 people a week ask me this question. I’m grateful that I’m considered an expert who can answer this with authority.
These days, the answer is, honestly, GREAT! But, depending on the audience, there are a number of ways to answer. One word (GREAT) is hardly sufficient unless we truly are having the conversation in passing.
What makes the market GREAT? Again, depending on the audience, there are four major reasons for things getting better.
Reason #1. There are more buyers actively looking than six months ago, or 12 months ago, or 24 months ago, and the numbers continue to grow. Pent up demand? Yes, and more people available for the American Dream of homeownership. Buyers have curbed their addiction to HGTV. (As you know, when any property is for sale on TV, that property is nearly perfect. That is the nature of TV, right?) Actually, I have a big place in my heart for people who think TV and their access to the Internet and other amateur perspectives are accurate!
Reason #2. Interest rates are historically low. Owning is easier than when rates were high. Rates? Banks have begun to loosen the rules for buyers and refinance. Consider: If interest rates change 1%, the loan amount changes about 10%.
Reason #3. Generally speaking, sellers have gotten the memo that prices and values for the home they want to sell did not go up just because that owner made one more payment. (To be “real” about it, payments have nothing to do with value. Value has nothing to do with how much $$ you need to clear to afford the next home. Values do not go up just because we flipped pages on a calendar. Sounds like a future blog topic).
Reason #4. And this is BIG: Look at the number of Realtors out there. At the peak of the business, about 2006, there were 2,490 Realtors in New Castle County. Call it 2,500 just for the sake of math. At the end of 2013, that number was in the mid 1,600s, which means about one third of the agents went away. Last week, the number was in the 1,500s, which means some agents could not afford license fees or neglected to get continued education credits as required by the State of Delaware. I do not need twice as many buyers and sellers if I have half as many competitors. I have had many conversations with other seasoned agents who are glad the amateurs are gone. These past few years, almost every deal was a battle.
So yes, the real estate market is GREAT! Buyers want to buy. Sellers want to sell. And I get to do what I love best.