Sellers are feeling confident this spring
Even as the market has slowed, sellers are optimistic that they can get a good deal on their sale.
Key points:
- A survey from Realtor.com found that nearly 75% of sellers expect to get at least their asking price.
- Seller confidence has increased from August despite the market slowdown.
- In some markets, that confidence may be well-founded; in others, seller expectations may be unrealistic.
High prices and low inventory may be causing grief for buyers, but sellers are feeling even more confident than they were last summer, according to a new survey.
One-third of potential sellers want to take advantage of the shifting real estate market, according to a survey by Realtor.com and HarrisX. And more than a third (35%) believe buyers will be willing to forgo inspections and appraisals to close a deal.
Those numbers are up significantly compared to a similar survey fielded in August, when mortgage interest rates were around 5% before climbing up to 7% three months later.
Whether that seller confidence is well-placed depends on the local market. Last month, homes in Boston were listed for 9.9% more than they were a year ago, and the median days on market was 30. In Austin, on the other hand, the median listing price was down 8.4% year-over-year, and homes were sitting on the market for 52 days, according to Realtor.com's monthly report.
"Given the changing housing market, it's important for buyers and sellers alike to have realistic expectations heading into a home sale," said Hannah Jones, Realtor.com economic data analyst. "By understanding the local market, sellers can make sure that they're pricing their home well to help ensure a quick sale and avoid a home that lingers on the market."
Most sellers believe they'll get at or above list price
Despite the sluggish market, sellers generally expressed confidence that their homes would sell at or above list price. The survey found that 43% of potential sellers expect to get their asking price; another 31% believe their home will fetch more than the asking price, up from 30% in August, though fewer sellers (27%) expect a bidding war to break out for their house, down from 32% in August.
Sellers may feel they have a certain amount of leverage because inventory remains low and they have quite a bit of equity in their homes. That gives them the flexibility to potentially set a higher price, or delay their sale and instead use some of that equity to remodel. According to the Realtor.com survey, 85% of potential sellers are happy with equity they have in their home, with 74% estimating they have more than $100,000.
Mortgage rates are also influencing seller decisions. More than 70% of existing mortgages are under 4%, so many sellers aren't motivated to give up those low rates unless they have to, said Rick Sharga, CEO of the consulting firm CJ Patrick Company.