Black Friday and Cyber Monday are behind us, yet finding the perfect holiday gifts for friends and family is certainly still top of mind for many right now. This year, there’s another type of buyer that’s very active this holiday season – the home buyer.
Each month, ShowingTime releases their Showing Index which tracks the average number of appointments received on active U.S. house listings. The most recent index notes:
“The Showing Index reported a 60.9 percent jump in nationwide showing traffic year over year in October, the sixth consecutive month to see an increase over last year.”
Here’s the breakdown of the latest activity by region of the country compared to this time last year:
- The Northeast increased by 65.5%
- The West increased by 64.7%
- The Midwest increased by 55.7%
- The South increased by 54.7%
Why is the traffic so active?
The health crisis definitely put home-buying plans on pause for many earlier this year. Buyers, however, are in the market and making moves well past the typical busy home-buying seasons of spring and summer.
One of the main reasons buyer traffic has continued to soar in the second half of 2020 is how dramatically mortgage rates have fallen. According to Freddie Mac, the average mortgage rate last December was 3.72%. Today, the rate is a full percentage point lower.
There are first-time, move-up, and move-down buyers actively looking for the home of their dreams this winter. If you’re thinking of selling your house in 2021, you don’t need to wait until the spring to do it. Your potential buyer is very likely searching for a home in your neighborhood right now.
If you’re one of the many homeowners thinking about taking your house off the market for the holidays, hang on. You definitely don’t want to miss the great selling opportunity you have right now. Here’s why this month is the optimal time to make sure your house is available for holiday buyers.
The latest Existing Home Sales Report from The National Association of Realtors (NAR) shows the inventory of houses for sale has dropped to an astonishing all-time low. It now sits at a 2.5-month supply at the current sales pace.
Historically, a 6-month supply is necessary for a ‘normal’ or ‘neutral’ market, in which there are enough homes available for active buyers (See graph below):
When the supply of houses for sale is as low as it is today, it’s much harder for buyers to find homes to purchase. This means competition among purchasers rises and more bidding wars take place, making it essential for buyers to submit very attractive offers.
As this happens, prices rise and sellers are in the best position to negotiate deals that meet their ideal terms. So, if your neighbors decide to remove their listings this season, your house may quickly rise to the top of a holiday buyer’s wish list if you stay on the market.
Today, there are many buyers who are ready, willing, and able to purchase. Record-low mortgage rates and a year filled with unique changes have prompted buyers to think differently about where they live and to take action. The supply of homes for sale is not keeping up with this high demand, making now the optimal time to sell your house.
Home prices are appreciating in today’s sellers’ market. Making your home available over the next few weeks will give you the most exposure to buyers who will be actively competing against each other to purchase it.