Home sales have slowed a lot since the highs of the market last May and June. This has caused home prices to drop about 10% from the top of the market last year when interest rates shot up very fast. This sudden rise in interest rates caused a dramatic slow down in home sales and the lowering values. Interest rates have leveled off from the high of about 7.25% to the 6% area in the 1st quarter of 2023. So how do you decide if now is the smartest time to sell? When thinking, should I sell my house now in Utah, look at these five factors to help you determine if you should sell your house in 2023 or should you wait. The one silver lining is that buyers now have more homes to look at and less competition.
Have Interest Rates Now Stabilized?
Interest rates are playing a big role in this slowing market. Mortgage rates the last 5 years chart (see the video at the right to learn how the chart in the link works) were historically low around July 2021, and at 3% starting the year in 2022. Then rates rose very fast to a high of 7.08% in November of 2022. Since then, rates have slowly gone down.
No one knows what will happen as we go through 2023, but currently it looks like mortgage interest rates may start to go up again and reach the highs of last November. That will slow home sales and may put downward pressure on home prices.
If you’re looking to buy a home, it’s smart to take advantage of the the increased home inventory caused by rising interest rates. Home prices have also fallen about 10% from the highs last year because there are fewer buyers looking for homes right now. It will be interesting to see if there are more and more houses on the market as we go through summer.
Foreclosure Moratorium Is Over
Another factor to consider is the end of the foreclosure moratorium put in place under the Biden ministration when Covid-19 hit. With the moratorium homeowners who were having trouble making mortgage payments could request a forbearance from their lender. The deadline for the forbearance period was extended to July of 2021. Thousands of homes with a FHA loan and more than 90 days behind on payments could now be sent into foreclosures.
During the moratorium there were very few foreclosures on the market, this factor combined with a low supply in general meant that homes were higher in demand than ever and high home prices reflected that. Foreclosures are now ticking up which is helping increase the number of homes for sale.
In 2023 there are no moratoriums on foreclosures.
The Number of New Home Builds is Down
Utah is dealing with an issue of supply and demand. While demand was very high last year before June, demand is now down which tends to stabilize or reduce home prices.
Baby Boomers Homes are Coming to the Market
Baby boomers are currently in their mid-50’s to mid-70’s and own roughly one third of homes in the U.S. These means that as this generation starts to downsize, move in with family, die or go into a retirement home there will be roughly 21 million homes hitting the market in the next decade.
That means thousands of additional homes for sale each year affecting the current market prices and availability.
Should I Sell My House in 2023?
When you are trying to decide, should I sell my house now in Utah, there are a lot of things to consider. Now could be a good time to buy a home because these are more homes to look at, waiving inspections and making offers above list price are things of the past. You can take your time to view homes and make offers.
Affordability can be an issue because of higher interest rates which could reduce how expensive of a home you can afford. However, most experts think that mortgage rates should settle in the lower 5’s by the end of 2023 or sometime in the next year. You can always refinance your mortgage down the road. Keep in mind that as rates lower, home prices could start to increase again because of more demand.
These aren’t the only factors, however. Do you need to be able to purchase a new home in this market? Will ending up in a bidding war on a new home make financial sense after selling your current home? Personal factors as well as your job and financial situation and even the condition of your current home will also play a big part of your decision.
If you’re worried about selling a house in poor condition or if you need to sell quickly to avoid being late on mortgage payments then consider working with a fast, non-traditional home buyer like Gary with Gary Buys Houses. Reach out to him today to get a custom quote that is tailor fit to your situation — even allowing for you to rent back your house or stay in your house for several months while you search for your new home. Click HERE to reach out to Gary today and take the stress out of deciding if NOW is the right time to sell a house in Utah.