Does it seem like the market is so much worse this year than last? Does it seems like houses are taking much longer to sell?
There are a few factors effecting the perception of the current market:
1. More houses have been listed for sale this year than last. We have had exponential growth in the past two years due to the limited amount of inventory caused by the flood. According to recent sales in the Multiple Listing Service (MLS) system for the greater Baton Rouge area, 35% more homes have been listed for sale between January-June of 2018 than the same time in 2017. Think of all the homes that were listed, or about to be listed, for sale back in 2016, but they flooded. These homes were basically removed from the marketplace, and have started reentering the market this year, as renovated homes, for the first time since the flood. This is not necessarily a bad thing, it just means more competition for sellers and more options for buyers. The good news is that this is pretty consistent in every price range, so there isn't one price point being overly bombarded with competition.
2. Less houses have sold this year than last. According to sales in the MLS system for the greater Baton Rouge area, 9% less homes have sold between January-June of 2018 vs the same time last year. Some of this is related to the flood - so many people who flooded were forced to purchase a home last year, so they obviously don't need another new home this year. Part of the drop in sales is also related interest rates increasing - sales are down Nationwide this year by about 4%.
So what does all of this mean? The housing market is not taking a downward spiral, it is simply leveling off. If you are a seller, you have more competition and will need to work harder to make sure your home beats out the competition. In this market, thorough preparation, aggressive marketing, and effective representation by an experienced real estate agent is imperative. If you're a buyer, you need to think about how each small increase in interest rates could effect your mortgage. Lucky for you, rates are rising slowly, which means you still have time to find your perfect house and take out a mortgage while rates are still low. Plus, you have lots of inventory to choose from!
If you have any additional questions about buying or selling your home, please don't hesitate to give me a call at 225-229-0451 or email me at firstname.lastname@example.org.