Navigating a Frenzied Market Will Take Patience and Planning
SELLERS: This market is firmly in your favor
We are in the strongest seller’s market ever recorded locally. Housing inventory is at a record low. All of the inventory we currently have in the Philadelphia suburban market would be sold in less than 2 months if no additional homes are listed for sale. (A balanced market = 6 months of housing inventory.)
Pennsylvania median home values have increased 16% over the past year. Sellers are receiving multiple offers with excellent terms in the form of waived inspections, waived appraisals, and cash offers. What does this mean? Sellers may want to accelerate their plans, as the current market will likely deliver excellent returns.
BUYERS: Put your best foot forward
Before starting your home search, put your financing in place. You’re going to be competing against a boatload of other buyers. Most homes are receiving at least 10% over asking price, so adjust your home search accordingly. Shop at least 10% under your max budget. Decide preemptively which concessions you’re willing to make. If waiving inspections is a nonstarter, consider conducting inspections for informational purposes only or restricting the amount of repairs you’ll request from the seller.
Depending on how much cash you have available, you could offer to pay some of the seller’s closing costs and/or waive (partially or fully) the appraisal contingency. With home prices estimated to climb another 10% in 2022, and 6% in 2023, putting your strongest offer on the table now may save you time, energy, and money later.
SELLERS WHO ARE ALSO BUYING LOCALLY: Plan ahead for your transition
Above all other things, do not sell your home without securing your next home first. Either purchase your new home first, purchase new construction, crash with family, plan to rent during transition, or consider renting an RV and parking it in a local campground. The last suggestion might seem a little extreme but I have clients who use this method and it really eases their moving transitions!
If you need the funds from your current home to purchase your next home, a bridge loan or a home equity line of credit might be a critical piece of the puzzle you’ll need to put into place before you start your home search. Reach out with questions. I can help you design a plan that accommodates your specific real estate needs.
Melissa Walter, CRS, ABR, SFR, REALTOR®
Compass RE / 4 E Montgomery Ave / Ardmore PA, 19003
Serving Montgomery, Bucks, Chester, Delaware, and Philadelphia Counties