What is the market like for fall real estate?
While it’s true that housing inventory (the number of homes on the market) is lower in the fall than in the spring and summer, it’s also true that buyers who are shopping in the fall are likely to be serious about buying. Fall buyers may be moving because of a job relocation or change in family situation, so they’re often eager to close a deal. And, the hotter your local real estate market, the less significant a role seasonality plays.
What months are in the fall?
To clarify the part of the year we’re talking about, fall includes dates between September 1 and November 30. In most of the country, this time of year is marked by cooler weather, shorter days, and falling leaves — think picking apples, carving pumpkins, and enjoying turkey dinners. Holidays that fall within this period include Labor Day, Columbus Day, Halloween, Veterans Day, and Thanksgiving.
Pros and cons of selling in the fall
Advantages of selling a house in the fall
- Serious buyers are motivated to purchase quickly, before the busy holiday season and bad weather set in.
- The seasonal atmosphere makes your home feel warm and welcoming.
- It’s a misconception that the vast majority of buyers are shopping to fit their kids’ school year schedules. In fact, more than half of buyers don’t have kids under 18 at home, so the fall is as good a time as any.
- In early fall, it’s typically light enough to do weeknight showings, in addition to weekend open houses.
Challenges of selling a house in the fall
- Since it’s an off-peak season, there are simply fewer buyers than there are in spring.
- Worsening weather can make showings difficult, and falling leaves make it hard to keep up with autumn curb appeal.
- The 44 percent of buyers who do have kids generally prefer to be settled in a new home before the school year starts.
- Busy work and school schedules and holiday plans can make it hard to schedule showings.
Here are five reasons why you should consider selling your house this fall:
1. Demand Is Strong
The latest Realtors’ Confidence Index from the National Association of Realtors (NAR) shows that buyer demand remains very strong throughout the vast majority of the country. These buyers are ready, willing and able to purchase… and are in the market right now!
Take advantage of the buyer activity currently in the market.
2. There Is Less Competition Now
According to NAR’s latest Existing Home Sales Report, the supply of homes for sale is still under the 6-month supply that is needed for a normal housing market at 4.7-months.
This means, in most areas, there are not enough homes for sale to satisfy the number of buyers in that market. This is good news for home prices. However, additional inventory is about to come to market.
There is a pent-up desire for many homeowners to move, as they were unable to sell over the last few years because of a negative equity situation. Homeowners are now seeing a return to positive equity as real estate values have increased over the last two years. Many of these homes will be coming to the market this fall.
Also, as builders regain confidence in the market, new construction of single-family homes is projected to continue to increase over the next two years, reaching historic levels by 2017. Last month’s new home sales numbers show that many buyers who have not been able to find their dream home within the existing inventory have turned to new construction to fulfill their needs.
The choices buyers have will continue to increase. Don’t wait until all this other inventory of homes comes to market before you sell.
3. The Process Will Be Quicker
Fannie Mae announced that they anticipate an acceleration in home sales that will surpass 2007’s pace. As the market heats up, banks will be inundated with loan inquiries causing closing-time lines to lengthen. Selling now will make the process quicker & simpler.
4. There Will Never Be a Better Time to Move Up
If you are moving up to a larger, more expensive home, consider doing it now. Prices are projected to appreciate by 5.3% over the next year, according to CoreLogic. If you are moving to a higher-priced home, it will wind up costing you more in raw dollars (both in down payment and mortgage payment) if you wait.
According to Freddie Mac’s latest report, you can also lock-in your 30-year housing expense with an interest rate around 3.46% right now. Interest rates are projected to increase moderately over the next 12 months. Even a small increase in rate will have a big impact on your housing cost.
5. It’s Time to Move On with Your Life
Look at the reason you decided to sell in the first place and determine whether it is worth waiting. Is money more important than being with family? Is money more important than your health? Is money more important than having the freedom to go on with your life the way you think you should?
Only you know the answers to the questions above. You have the power to take control of the situation by putting your home on the market. Perhaps the time has come for you and your family to move on and start living the life you desire.
Additionally in Washington State there is the new Real Estate Excise Tax Increase:
Washington state has one of the highest real estate “transfer tax” rates in the country, according to a study (NAR login required) by the National Association of REALTORS®. That rate will now be higher for sellers of homes valued at slightly over $1.5 million or more. The current single rate REET is assessed at 1.28% on the sale price of the home. In addition, most local governments in the state assess an additional one-half percent on the sales price, making the current effective rate 1.78%.
Under the new system, effective in 2020, the first $500,000 of value will be taxed at a new reduced state rate of 1.1%, saving the seller of a $500,000 home $900. For the value of the sale between $500,000 and $1,500,000, the tax rate remains 1.28%. For the value of the sale between $1.5M and $3M the rate is 2.75 % and for sales above $3M the rate is 3%. Because the tax is assessed at a marginal rate (the different rates apply on each portion of the sale), the actual breakeven point between the old and the new rates is $1,561,224 of value. Sales greater than that amount will pay more REET under the new system and sales under that amount will pay less.