It’s an opportune time to sell in Meredith because home prices are peaking, the number of “days on market” has plunged, interest rates and economic conditions are excellent for buyers, the inventory of for-sale homes is low, and marketing technology has never been better.
First, let’s look at each condition favorable for sellers.
In 2018 the median "closed" price for Meredith single family homes surpassed the previous peak attained back in 2008. This represents the highest median home sale values in Meredith in over a decade, since 2006, when many prices were artificially inflated by the loose lending practices that led to the subprime mortgage crisis.
Additionally, with just 35 median days on market in 2018, single family homes in Meredith sold at the fastest pace in at least 21 years.
Regarding inventory, there are presently only 33 single family homes actively listed for sale in Meredith, a town the U.S. Census Bureau estimates to have 6,384 residents and 4,654 housing units.
A low supply of for-sale homes advantages sellers, as buyers become more willing to overlook perceived shortcomings in a home (like dated bathrooms and cabinets) when there is little inventory to choose from. The result can often be multiple offers, stronger negotiating position and higher prices for sellers.
According Freddie Mac, mortgage interest rates have declined to 4.35%, which is the lowest rate since February 2018. This is welcome news for buyers who had grown accustomed to abnormally low interest rates, and watched in dismay as they neared five percent in mid-November, 2018, a rate many had not seen in years, or ever. Consequently, the number of consumers applying for mortgages is on the rise.
Buyers also have additional reasons to be confident… for now. According to a recent CNN Poll, 71% of respondents said the nation's economy is in good shape. That’s the highest percentage to say so since February 2001. The survey also found that 42 percent of respondents said their personal financial situation is better off today than it was three years ago.
These survey results correspond with several other economic indicators that give buyers confidence. For example:
- Our nation’s Gross Domestic Product (GDP) grew 3.1 percent from the fourth quarter of 2017 to the fourth quarter of 2018, the fastest growth pace in 13 years.
- More than 2.6 million jobs were created in 2018, and the number of job openings surpassed the number of unemployed workers for the first time on record.
- The unemployment rate hit 3.7 percent in September 2018, a near 50-year low.
- The unemployment rate remained at or below 4 percent for the past 12 months, the longest streak in nearly five decades.
- Hourly wages grew 3.4 percent over the last 12 months, the fastest pace since 2009.
So it’s a great time to list a home in Meredith, but these conditions cannot persist indefinitely. What goes up must come down, including windows of opportunity. Let me give you some reasons why.
Consider that home prices in Meredith have far exceeded income growth in New Hampshire and Massachusetts, our two largest buyer markets.
Meredith home prices spiked 26 percent between 2010 and 2017. During that same period real median household income growth in New Hampshire was stagnant, and in Massachusetts income grew just 6.7 percent. When homes become overvalued, buyers pause until prices correct.
For example, Meredith median closed prices plunged more than 34 percent between the previous peak in 2006 and the market bottom in 2010. Those who missed the opportunity to sell during that window opening had to absorb painful losses or wait more than 12 long years for values to recover. That would be the equivalent of a $123,000 loss in value from 2018 median home prices in Meredith.
While the news on interest rates is good for 2019 (on Wednesday the Federal Reserve signaled that it likely will not raise rates for the remainder of the year), mortgage rates are influenced by the Fed’s adjustments to interest rates, and many officials at Wednesday’s Fed meeting hinted that a rate increase is likely in 2020.
It’s undeniable that the economy has flourished in the last two to three years, but economies move in cycles, just like real estate markets. Another recession is inevitable, a matter of when, not if.
According to the Fortune media group, “The risk of a recession is seen at a six-year high. In fact, more than three-quarters of corporate chief financial officers expect one by the end of 2020.” This outlook is shared by nearly half of the real estate experts and economists who responded to a recent Zillow survey. The prospect of recession in 2020 makes spring 2019 an excellent time to list.
Tom Peters, esteemed author and expert on business management practices, once said: “If a window of opportunity appears, don’t pull down the shade.”
If you own a single family home in Meredith and have been waiting for a good time to sell, a window of opportunity is wide open. Generally, Meredith homes are selling at peaking prices and the fastest speeds on record. It's clearly a seller's market due to strong buyer demand and a limited supply for for-sale homes.
If you’re curious about how much money you could earn for your Meredith home in the best seller’s market in over a decade, contact me… before the window slams shut!