Housing market news hasn’t been front and center in the Wall Street Journal for quite some time. But Wednesday, the decline in existing-home closings for December, made the front page. Existing home sales fell to a seasonally adjusted rate of 6.4% in December, 2018. The fact is, sales have been declining somewhat for several months, although not significantly until “the surge in stock-market volatility...and rising interest rates, which pushed up mortgages rates in November to their highest levels in seven years.”
Mortgage rates have come down in the past few weeks, as a result of the Federal Reserve dialing back on some of their earlier plans to raise rates in 2019. It’s no surprise that housing sales would stumble - housing is a rate sensitive industry. The Fed’s position affected the stock market as well. The voluble stock market also contributed to lower activity in the fall and lower closings in December.
The important thing to keep in mind is to understand how all of this affects you as a buyer or as a seller and what you should do? The key to besting the “housing market blues” is to get in front of the predicted trends and take action.
If you are a buyer, lucky you, it’s an opportune time to shop for a home and get a great deal. Line up your financing, have your down payment in hand, and get going. This is a window of opportunity that will likely change, perhaps even in a few months. It may also be a good time to move some assets from the stock market to real estate with a self-directed IRA.
If you are a seller, and your home is on the market, reassess your situation. Sit down with your realtor and discuss options open to you - enhance presentation or condition of your home, address the pricing, and explore additional marketing opportunities. Your agent is your partner – work with her/him.
If you are planning to sell your home, move as quickly as possible – get your house in shape, and put it on the market. Waiting is an option, but not in the short term, only if you’re prepared to put your plans on hold for a couple of years of more.
Our advice is to put your plans in motion, don’t put your life on hold. Theodore Roosevelt said, “Do what you can, with what you have, where you are.” We are here, ready to help you figure out what you can do with what you have, and then... get things going. Just call us, 631-765-5333!
Sources: Slump in Housing Market Deepens, pages A1-A2; The Housing-Market Blues Aren’t Going to Be Over Soon, page B14, The Wall Street Journal, January 23, 2019. National Association of Realtors