The Housing Market SHIFT Hits Raleigh NC
The housing market shift has hit Raleigh, North Carolina and in this blog we’re going to tell you what's going on and what you need to do about it. What's happening in the housing market right now? Well, clearly we're going through a shift. Buyers are acting erratic. Homes that were selling in hours or days just a few weeks or months ago are now selling in a week or sometimes even a month or longer. What's happening in the housing market today? Well, the best way to describe it is the housing market is acting really erratic. Buyers are getting much picker than they were even just a few months ago. Homes that were selling in hours or days are now selling in weeks or months. Buyers are getting pickier and homes that used to be good enough now are just passed over. The homes must be absolutely perfect for that buyer.
Of course there's the big elephant in the room, interest rates. Interest rates have risen recently, which is dramatically impacting a lot of buyer's ability to buy all across the price spectrum. There's another reason days on marketers are increasing and it's dramatically impacting our housing market locally, there's been a rule change in how our multiple listing service, the MLS counts days on market. So we've had for a little while now, a coming soon homes status, that's basically where you can list your home for sale and market it online, but no one can come into your home and make showings on the home until a specific date. Once that date hits the home can then flip into an active status, which means people can go visit the home, look it over, check under the tires. In the past, the days on market did not start clicking and adding up and accruing until you hit the act of status. Now those days on market start accruing from the minute your agent puts the home on as a coming soon home. So needless to say my team and I, how are no longer doing coming soon listings, there's no benefit in doing that. It does nothing but damage the home.
What do I mean by damage the home? Again, buyers are conscious about days on market. If an agent puts a home as coming soon, ten days ago, guess what? It now has days on market as ten showing up on the MLS and therefore on Zillow, realtor.com truly, et cetera. Most buyers are very weary of seeing any homes that have been on the market for over four or five days. Their automatic thought is what's wrong with this house? It is completely within the realm of possibility that someone could have a brand new home that no one has ever stepped foot in, that shows ten days on market. This means likely fewer people are going to be looking at the home to buy, which means that any offers that home gets will likely be under asking price or at asking price. Therefore, which unfortunately means that seller is potentially going to loose thousands of dollars on the sale of their home that they could have made had their agent not made this big giant mistake.
Is this shift a good thing? Well, for the market, it is a good thing. It's bringing us closer into being more of a balanced market. More accurately, it’s probably bringing us back to where we were in the 2019 period before the pandemic hit, meaning we're still have got low inventory, but there's not that frenzy out there that there was just during and just after the pandemic where everything with the doorknob and a roof was flying off the shelf for thousands and thousands of dollars above asking price. We're getting back to more of that 2019 period where people are methodically buying houses. It's more calm. It's not that the world is crashing and that there's coming to an end and home prices are going to tumble by 50%. It's not that at all. It's just that the crazy frenzy period is over or at least taking itself a little break. What this all this means is it's definitely easier for home buyers to buy a house and homes that are sitting on the market for a little while. Maybe they need some cosmetic touchups. Those homes are not getting seen by very many buyers at all, which means you may have an opportunity to swing in and buy that house, do that cosmetic painting or whatever, and get yourself a really good deal overall. Unfortunately, there still are some homes that look absolutely amazing and those homes are, I say, unfortunately, unfortunately for the buyers out there, because those homes are getting gobbled up quickly, multiple offers, aggressive buyers, lots of showings.
By and large, the homes that have a few flaws, those are getting picked over and passed over and it's a great opportunity for you as a buyer to get out there and buy one. And for sellers, all this means that you shouldn't really expect that you're going to get a hundred thousand dollars over asking price for that abandoned shack in the woods. You've been meaning to sell for the homes that look really good. Those are getting really good, strong offers, but if your home has some flaws and need some work done, it's very likely that it could set on the market for a while and start accruing those days on market. Please know if you are in contemplating selling your home and you're not willing to fix anything up, you may be stuck in this trap of having it set and linger on the market. Also, please know that the lot of the cosmetic touch ups that will get your home sold can be done for relatively low money. And if you don't have any vendors that you have in your back pocket, that can do painting and touchups and things like that, and minor repairs, give us a shout, email us, [email protected]. We'll be happy to put you in touch with some folks.
So what could happen next? Well, frankly, we don't know this could be a short term trend. It could be a long term thing. We don't know. We do know that it's being impacted by those interest rates. We talked about earlier, it's being impacted by the fact that a lot of buyers are just really burnt out. They've made offers on multiple houses in the past few months and they've kind of just thrown their hands up. Plus summer means school is out and therefore families are thinking more about family vacations than they are about buying houses. And obviously as summer break ends and the kids are going back towards school, that issue should subside and people will become more interested in buying homes again. So it remains to be seen if this is a short term trend or a long term trend. Overall, we believe that the days of the stratospheric twenty percent to thirty percent price increases year over year are coming to an end and we are more likely getting back to how things used to be in the Raleigh market. Two, three, four percent appreciation of homes year over year, slowly but surely the tortoise versus the hair.
So should you buy a home now? Well, as we say all the time on this channel, you can't time the market. If you try to do so, you may get lucky and buy at a low point, but likely you're going to end up wasting a lot of money waiting to buy until the perfect time, because the perfect time will never come. So when you're ready to buy a home, you should buy a home. There are more homes for sale now than there have been in quite a while. Plus builders are bombarding our email box just about every day, letting us know about home inventory that they have sitting around available to be purchased just a few months ago. Most new homes were sold before they even started construction. Now we're starting to see homes that are thirty days, sixty days, ninety days of out available to purchase without any competition or very little competition.
And of course, for all of you out there thinking, of course you want me to buy a home? You're a real estate agent. Well, my past clients and current clients will certainly tell you my team and I spend more of our time talking people out of buying a home than we do talking them into buying a home. If the time is right for you to buy a home, you should buy a home. Nobody should pressure you to do so. And you should not settle for a home that doesn't work for you. You're just going to regret it a few months down the road and if the alternative to buying is renting a home, then you should definitely consider buying a home. Home prices are going up and up and up. And so are rental rates know that when you rent, you are paying someone else's mortgage. If the time is right and the finances are right for you to buy a home now is a great time to buy a home and stop paying someone else's mortgage.
If the market continues climbing in price, it is not out of the realm of possibility that Raleigh could be just like some of the larger cities out there where half the population simply can't afford to buy a house and end up being lifetime renters. What's happening in most of these larger cities is that investors are coming in, gobbling up all of the inventory, making it difficult for people to find a home and unfortunately also ratcheting the price up higher and higher, which means people have little choice but to rent. So what all this means is if you have the means to buy a home now is a really, really good time to do so. Competition is low. Days on market are going up and up and so therefore it makes it much easier to buy a home with less competition.
So should you sell your home? Now, now is a good time to sell your home. If it looks like the model home we talk about in the past, if it doesn't look like a model home and it has some flaws, know that your home may sit on the market a while. So you have to be prepared for that. Most buyers just don't have the time to buy a fixer upper and work on it. Again, you can make a lot of improvements on the home for just very little bit of money. Give us a call if you need any help with vendors.