If you have been on the fence about selling your Florida home, now is definitely a good time. I will give your three reasons why?
Reason Number 1. We are in a seller's market right now.
A sellers market is defined as when the current number of homes available on the market would all be sold in six months or less at the current rate of sales. If the current rate of sales means the available homes would take longer than six months to sell, then we would be in a buyers market. The market is considered balanced if it would take about six months to sell all the current homes available.
If you look around South Florida, single family homes near the median price level have about 3 months worth of inventory. At the entry level price ranges there is even less than that. Condominiums have about 3 to 5 months of inventory. Both are well below a balanced market of six months.
Its hard to believe, but this seller's market actually began around 2011. Waterfront property made the swing in 2010. So we are in the seventh year of a sellers market in Florida. Who knows exactly when this cycle will end. Why take a chance if you can get out now.
Reason Number 2. Interest rates will most likely be higher next year
The Fed has raised interest rates twice already in 2017. It is expected they will raise the rate at least once more before 2017 is over. Higher borrowing costs means less buying power for the prospective buyers of your home. If the average rate increases from 4% to 5% that will equal a 10% decrease in what a buyer will be able to afford to spend. If they could afford a $500,000 at 4% interest, they will only be able to afford a home priced at $450,000.
Reason Number 3. Consumer Confidence is Good Today
Economic news has been mostly good lately. The stock market has been hitting record highs and the unemployment rate has been dropping steadily. In May 2017 the seasonally adjusted unemployment rate was 4.3%.
I am generally an optimistic and I hope this trend continues. However, I would rather be selling when the news is good than when things turn sour.
Everyone has different circumstances that will affect their decision to sell and when. If you are trading up to a bigger and better home, then waiting will only mean the house you will eventually buy will cost more too. If your are downsizing, you may be able to hold out a while longer. If your home has obvious flaws you definitely should be selling while the market is hot. If you own a vacant property, there is no sense in waiting. Any appreciation you are getting currently will get eaten up by your carrying costs.
Ten years ago we all thought prices will rise forever. We learned the hard way that they don't.
Related:
The Hidden Cost of Holding on to a Vacant Property
What Does it Cost to Sell a Home in Florida?
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Buying and selling real estate can be a complicated process, so it is important to learn the lingo before you get started. So here is a short list of the more common terms you will hear and what they mean to you.
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