Nearly 8% Up Nationwide For Home Prices From Last March

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Nearly 8% Up Nationwide For Home Prices From Last March

Apr 28, 2023 | News | 0 comments

After two highly successful seasons in 2021 and 2022, during which home prices skyrocketed and inventory decreased, home sellers are confronting new market conditions this spring. Although home prices remained 7.8% higher than the previous year in March 2023, price growth has slowed for nine consecutive months, and houses are taking longer to sell.

This spring, low buyer demand and scarce affordable inventory make it tough for home sellers and buyers. Selling a home has become complex, with over 85% of sellers surveyed planning to purchase a new home simultaneously, requiring many buyers to accept a higher mortgage rate. Additionally, more than three-quarters of home sellers feel “locked in” to their current homes due to low mortgage rates, with more than half planning to wait until rates drop before selling. However, 25% plan to sell soon for personal reasons, despite feeling “locked in.”

Most Gen Z, millennial, and Gen X owners feel constrained by their current mortgage rate. While a third of Gen X owners still plan to sell, baby boomers, with the least debt, are less likely to feel locked into their homes. Owners looking to sell are driven by potential profits, changing family needs, or the desire for different amenities. Affordability and proximity to family are key drivers for Gen Z sellers.

In the current challenging housing market, most home sellers are content with the equity in their homes, with 85% expressing satisfaction. The majority also estimate that they have over $100,000 in equity and 42% estimate over $200,000. The hot market of 2021 and 2022 has created a new normal, with over a quarter of sellers expecting a bidding war, 31% expecting above-asking offers, and 37% anticipating an offer within a week, while only 42% expect to sell for the asking price.

Despite a cooler housing market, 35% of potential home sellers surveyed anticipate that homebuyers will be willing to forgo contingencies, while 34% expect an all-cash offer. These expectations are higher than those held by potential home sellers in August 2022, when high mortgage rates dampened market momentum heading into the end of the year.