DO YOU REALLY WANT TO DO THE LIMBO?
The low inventory limbo that is. Last month, both closing activity and pending sales dropped year-over-year. In fact, our supply level dropped to 2.7 months in January. The diminishing supply is hindering sales activity and has created an unbalanced market that favors sellers. The more inventory goes down, the more pending sales do the same and it becomes a downward spiral – one that’s making it hard for our members to get deals under contract.
According to the National Association of REALTORS®, demand remains at all-time highs. Which is why we’ve been selling houses faster and for more money. Low-interest rates have also contributed to strong demand and this makes it a great time for prospective buyers to buy a home. The historic average for a 30-year, fixed rate mortgage, is 8% and now rates are just over 4. Even with a credit score below 650, buyers may be able to find a rate of 5%.
What does this mean? Well, rates are more likely to go up than down, so buyers shouldn’t wait. This means opportunities exist for REALTORS® who get out and hustle for their clients. It’s essential to work smart and hard. We only have so much time to divide among our existing buyers and sellers, and then we still must generate new business so we can’t afford to waste time. Take advantage of all the tools you have at your disposal from NAR and the state and local associations. You pay for these products and services and they can help you be more efficient and successful….but you have to use them.
As REALTORS® we can have an impact if we work hard and Do Our Job. We need to talk about why it’s a good time to put houses on the market BEFORE interest rates start to rise, decreasing affordability. “List To Last” is the saying that I like to remember so list, list, list! Go out and do what you can to stop the inventory limbo bar from dropping further. Raise that Limbo Bar!
Remember, REALTORS® are The Architects of The American Dream so let’s design a plan to help consumers participate in the dream of homeownership.