Considerations for Selling (or Not) Your Home in 2024

So, you’re about to embark on the thrilling adventure known as moving. And guess what? You have the power to choose your moving date! Talk about being in control. But hold your horses, my friend. Before you start packing up your life and hauling boxes, let’s talk strategy. You see, when it comes to selling your home, timing is everything. By strategically planning the timing and method of listing your humble abode, you can reel in those buyers, make some sweet profits, and make the whole process of finding your dream home a breeze. It’s like a triple whammy of moving awesomeness.

So, you’re in a bit of a pickle about whether to sell your property, huh? Well, fear not my indecisive friend, because I’ve got some options for you to chew on. Option one: you can put that bad boy on the market and take advantage of the current low inventory. Option two: hold off for a bit and see how interest rates and inflation play out. And lastly, option three: just chill in your current home for now and avoid making any major moves. The choice is yours, my friend, but no pressure. Just remember, whatever you decide, there’s always a chance for a plot twist in this crazy game of real estate.

Here are three arguments against selling your home in 2024, contrasted with three reasons why selling within the next year could be advantageous:

• Delay the sale: If you’ve recently purchased or refinanced your home.
• Delay the sale: If you’re concerned about the affordability of your next purchase.
• Delay the sale: If you’re anxious about finding a suitable home to move into.
• Proceed with the sale in 2024: If high interest rates do not deter you.
• Proceed with the sale in 2024: If you have a clear understanding of your home’s market value.
• Proceed with the sale in 2024: If you have a pressing need to relocate.

Delaying the Sale: Recent Home Purchase or Refinancing

So, you’ve recently purchased or refinanced your humble abode, huh? Well, if that’s the case, there’s no rush to put that “For Sale” sign up anytime soon. I mean, come on, you’ve got those sweet, sweet low mortgage payments taking a load off your wallet! No need to stress about your finances, my friend. Take a breath and enjoy the comfort of knowing you’ve got some financial wiggle room.

Back in the good ol’ days before 2022, homeowners were livin’ the dream with mortgage rates below 3%. I mean, who would even think about selling their home with those sweet rates? Unless some crazy circumstances force you to move, my friend, it’s time to kick back, relax, and enjoy that low rate you’ve snagged. Keep building up that equity in your humble abode like a boss!

Well, well, well. It seems like mortgage rates have been going on quite the roller coaster ride since 2022. According to the folks over at Freddie Mac, these rates have been bouncing up and down like a yo-yo. Picture this: in October 2023, the rates reached a peak of 7.79% for a 30-year fixed-rate mortgage. Yikes! But hold on tight, because as of March 28, 2024, the average rate for a similar mortgage had dipped down to 6.79%. Talk about a wild ride! It’s like trying to catch a greased pig at a county fair. You never know what you’re gonna get. So, if you’re in the market for a mortgage, buckle up and get ready for a thrill!

Picture this: You’ve managed to snag a mortgage interest rate that’s lower than a limbo champion’s backbend. We’re talking below 3%—heck, some lucky homeowners even scored rates below 2%! Now, imagine the horror of watching that rate skyrocket to three times its original value when you decide to buy a new home. Yikes! It’s no wonder folks like you are hesitant to give up their current digs based solely on mortgage rates. You’re not alone, my friend.

In a recent statement, Danielle Hale, the big shot economist over at Realtor.com, dropped some knowledge on us. She says, “Listen up, folks! The mortgage lock-in effect is on the decline, but don’t get too excited just yet. It’s still gonna be a major hurdle for a bunch of homeowners looking to sell in 2024.” And get this, according to the latest data, a whopping 90% of all outstanding mortgage debt is sitting pretty below 6%, with a solid 65% rocking a rate less than 4%. Can you believe it? It’s like finding out that 90% of your wardrobe is still in style and 65% of it is basically couture!

Hale suggests that homeowners may become more inclined to move once mortgage rates fall below 6%. This could be a pivotal factor to consider when deciding on the sale of your home.

Concern Over the Affordability of a Subsequent Home

Lately, folks have been freaking out about whether they can actually afford to buy another house. And can you blame them? Housing prices have been skyrocketing, and there just aren’t enough new properties up for grabs. Plus, with interest rates dancing around the 6% to 7% mark, the whole financial picture of buying a new home starts looking less appealing. So, if the timing doesn’t feel right, it’s probably a smart move to hold off on selling your current pad.

Even if you have substantial equity in your home, the calculation of your purchasing power might be affected by the increased interest payments you would need to make each month.

According to Lisa Sturtevant, the top money guru over at Bright MLS, this whole financial math problem is making it harder for people to sell their homes willy-nilly. If you can’t afford that dream home you’ve been eyeing, it only makes sense to hold off on putting your own property on the market. After all, why rush into selling when the numbers don’t add up in your favor?

Apprehensions Regarding Finding a Suitable Subsequent Home

In the wacky world of real estate, where houses fly off the market faster than a squirrel with a stolen acorn, there’s a glimmer of hope for homebuyers. According to a report by the National Association of Realtors, housing inventory saw a whopping increase of 0.3 months in February compared to last year. Now, I know what you’re thinking, “0.3 months? That’s like finding a penny on the sidewalk!” But hey, in this crazy market, every little bit counts. Despite this slight uptick, the truth is, finding a home is still as tricky as catching a unicorn on roller skates. Homeowners are holding onto their properties like they’re precious gems, making the available options scarce. However, there’s a silver lining! Even though the number of buyers dipped during the peak of the pandemic, they’re slowly but surely making a comeback. It’s like seeing a long-lost friend show up at your doorstep with a pizza just when you thought you were destined for a sad, frozen dinner. So, hang in there, house hunters! The market may be a roller coaster, but there’s always a surprise waiting around the corner.

Orphe Divounguy, the senior economist extraordinaire at Zillow, boldly proclaims, “Hey, affordability may be a tough nut to crack, but buyers are like Sherlock Holmes, always finding clever solutions to make those numbers work! We’ve got a swarm of millennials buzzing around, all eager to dip their toes in the homeownership pond. And guess what? Lower inflation has actually given folks bigger paychecks and more moolah in their pockets. Plus, brace yourselves, population growth is soaring like a rocket! All of these factors add up to an insane demand for housing. But wait for it…the villain of this story is the dreaded lack of inventory! Seriously, it’s like finding a needle in a haystack out there.” Ah, the ever-tantalizing shortage of homes for sale, the sneaky culprit responsible for keeping those darn prices sky-high. It’s like a never-ending game of hide-and-seek, where the elusive homes are the masters of disguise, making potential buyers jump through hoops just to snatch a humble abode. But fear not, brave house hunters, for the quest to find that dream home continues, with prices soaring like the superheroes of the real estate market!

Reasons to Consider Selling Your Home in 2024

In the year 2023, mortgage rates skyrocketed to heights higher than an over-caffeinated mountain climber. It was as if interest rates decided to go on a wild roller coaster ride, leaving homeowners clinging to their existing homes like a cat to a scratching post. But hold on a minute! Not everyone was freaking out about these interest rate shenanigans. Some folks, you see, had priorities beyond the numbers on their mortgage statement.

Alrighty then, folks! Get ready to have your mind blown by the one and only Mike Reynolds, the Vice President of Investment Strategy at Glenmede. According to this financial genius, there are some buyers out there who couldn’t care less about interest rates. Yeah, you heard that right! They might be planning to drop some serious cash on their next property or have enough equity in their current home to haggle for a sweet deal on their next mortgage. Talk about living life on the edge!

In a surprising twist of fate, the never-ending saga of interest rates above 6% has actually done some good. Yes, you read that right. It turns out that this tumultuous period has helped potential homebuyers wrap their heads around the concept of higher mortgage costs. Sure, it might require some serious budget reshuffling, but hey, it doesn’t mean that buying a home is completely off the table. Who knew interest rates could be so educational?

In the wacky world of real estate, Orphe Divounguy, a self-proclaimed senior economist at Zillow (whoever that is), has made a mind-boggling observation. Brace yourselves, folks, because apparently, buyers these days have become so chill that they consider a mortgage rate between 6% and 7% to be the new normal. I mean, seriously? Is this some kind of alternate reality where people willingly throw their hard-earned cash into the hands of lenders without even flinching? But wait, there’s more! According to Divounguy, predicting the market’s timing is about as easy as predicting the next viral TikTok dance. So, if you’re feeling particularly brave and ready to embark on a wild adventure, selling your house in 2024 might just be the right move. Because hey, who needs certainty when you can have a good ol’ dose of uncertainty, right?

Awareness of Your Home’s Market Value

Calling all homeowners! The U.S. housing market is like a sizzling hot potato that everyone wants to get their hands on. But hey, here’s the tea: the crazy competition and sky-high prices we witnessed in 2021 are starting to cool down a bit. So, if you’re thinking about putting your humble abode on the market in 2024, brace yourself for a bunch of cautious buyers who might not be so willing to throw stacks of cash your way. And if you go all out with an insane price tag, well, don’t be shocked if you end up hearing crickets instead of the sweet sound of cha-ching.

In the world of real estate, Divounguy has observed a fascinating phenomenon: the homes that fly off the market and attract a swarm of offers are the ones that hit the sweet spot of being both reasonably priced and decked out with all the bells and whistles, like fancy 3D tours and jaw-dropping professional photos. So, unless your real estate agent happens to be a wizard, it’s probably best to keep your expectations in check. Your humble starter home is unlikely to fetch a sky-high price without the safety net of an appraisal contingency. Nowadays, buyers are being extra cautious with their cash and making offers that stay safely within their budgetary confines. It’s all about being financially savvy, folks! The grand scheme and how folks perceive the worth of your humble abode.

Necessity to Relocate

So, you’ve reached that point in life where you just gotta pack up and move. Maybe you lost your job and the thought of those mortgage payments is causing you to break out in a cold sweat. Or maybe you’re embarking on a grand adventure, relocating to a whole new state. Perhaps your family has grown and you desperately need more space before you start tripping over toys left and right. Or maybe, just maybe, you’ve finally realized that your couch and kitchen table aren’t cutting it for your remote work setup. Whatever the reason, fear not! Selling your home and finding a new one is totally doable. You got this!

A profitable sale and purchase of a new home remain achievable, but it requires careful preparation and setting realistic expectations.

Hey there, homeowners! So, Danielle Hale, the chief economist, has some advice for you. She thinks it’s high time you evaluate your home equity situation. Why, you ask? Well, turns out that the typical listing price has shot up by a whopping 40% in the last five years. That’s right, folks, your homes are worth more than ever! And you know what that means? You’ve got yourself a nice, comfy equity cushion. Cha-ching! So, when you sell your house, you’re likely to pocket some serious dough that can be used to bring down the amount you need to borrow for your next home purchase. Now that’s what I call a win-win situation!

Now, listen up folks! Here’s the deal: don’t get your hopes up for the Federal Reserve to swoop in and dramatically slash interest rates if the economy takes a nosedive. I know, it’s a bummer. You see, even though mortgage rates aren’t directly linked to the Fed’s funds rate, they tend to follow its lead like a loyal sidekick. So, brace yourselves for some potential mimicking action if the Fed decides to shake things up!

Reynolds anticipates that mortgage rates will remain high throughout the year, stating that the Fed will be cautious not to reignite the stubbornly persistent inflation.