Is It Now A Sellers Market

Dated: 05/10/2014

Views: 2986

Home prices are moving so far, so fast, that at least 1,000 local housing markets have hit all-time price highs, according to Zillow. It should come as no surprise, therefore, that potential home sellers are giddy with value.  "I even hear them say that prices are skyrocketing," said Jeremy Cunningham, a northern Virginia real estate agent with Redfin, a real estate brokerage. "When you ask them what their data source is or where they're getting their information, it's more of a vibe."  Forty percent of sellers surveyed by Redfin said they are planning on pricing their homes above market value when they list in the second quarter of this year; that's up from 33 percent at the beginning of the year. Redfin polled 1,128 active home sellers across 25 U.S. cities. Confidence is behind it all. Fifty-two percent said they were confident that now is a good time to sell, versus just 37.5 percent three months ago. This, conversely, as sales of existing homes were actually lower in March by 7.5 percent from a year ago, according to the National Association of Realtors.  Another survey of 1,000 homeowners and renters by mortgage giant Fannie Mae found that those who say it is a good time to buy a house held steady in April at 69 percent, but those who say it is a good time to sell increased 4 percentage points from the previous month to 42 percent, an all-time survey high. Consistent with (April's) upbeat jobs report, concern about job loss among employed consumers also has hit a record survey low. These results are in line with our expectations for increased housing activity and gradual strengthening of the housing market going into the spring and summer selling season," said Doug Duncan, Fannie Mae's chief economist.  More sellers now say they are pricing their homes high because they are willing to wait if it doesn't sell, according to Redfin.  An increasing number of sellers also say they are pricing high because they need that value to pay off their mortgages. Nearly 10 million U.S. homeowners were underwater on their mortgages at the end of last year, according to Zillow.  Sellers are more likely to get their asking price from an all-cash buyer, and all cash means there will be no appraisal issues. However, for those in markets where there are fewer investors and all-cash buyers, commanding an above-market price is a dicey proposition. Even if they do strike a deal with a credit-dependent buyer, they are at the mercy of the appraiser, who will make the final decision as to the real market value of the home.    By CNBC's Diana Olick.
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Michael Krivacs

I grew up in Beach Haven on Long Beach Island and graduated from The American University with a BS in Business Administration. While in college I met my wife Holly. After school I worked as a Wage ....

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