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August 2011: Cooling Market
Posted August 29th, 2011 under market updates.
The fall market is here and more homes are coming on the market, with total listings up 13% over July. However, total sales have dropped 10% since July, with the result that the sales-to-listings ratio has dropped to 52% after four months of being in the high 60% range.
In addition, prices have stopped their rapid climb and are levelling off. All together these are signals that the market is cooling off.
Low interest rates have kept buying attractive, but it's inevitable that they will come up eventually, and that will have a further cooling effect.
If you want to take advantage of the seller's market, do it now and keep two things in mind: First, don't overprice your home. The upward price trend has ended, so you'll need a reasonable price or you'll end up waiting forever for a buyer.
Second, if you're buying, leave mortgage room for future increases in interest rates. An increase of 2% over the next few years would not shock economists, but the increased payments might shock you!
To learn more, read How Market Conditions Affect Price under the Smart Selling category.
Want to know more about the state of the market? Just ask me, I'll be happy to help.