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.