Both buyers and sellers ask about timing the market, and this Spring is no different. Your Guide is advising sellers that are ready to go on market and buyers that are already out hitting the pavement.
This year will prove to be unique. There are several factors that will have greater influence of the cycle of sales this year than the normal seasonal cycles.
The first milestone in a normal selling year is the Superbowl. (Read last year’s spring market kick-off post here.) But this year, Superbowl is later than normal. With itchy buyers already out shopping, smart sellers are already on the market, or just about ready to get on the market.
If you START prepping for your Spring market sale just before Superbowl (which is February 7) and get on the market a few weeks later, your selling season is critically short. Give yourself the extra three weeks of breathing room if you can get to market this weekend.
Home Buyer Tax Credit
The Home Buyer Tax Credit expires at the end of April, although closing can occur through June. This is going to drive the Spring market, but will also move Summer buyers early in the season. With some Summer buyers under contract ahead of schedule, we are predicting a slower than normal summer selling season. This is another solid reason for sellers to push to get their homes on the market as early as possible.
Fed influence on interest rates
The Fed runs out of money at the end of February. Currently, the Fed is pushing interest rates artificially lower than the market which is why we currently have both conforming and jumbo loans as low as 4.875% and hovering around 5.0%. When the Fed can no longer afford to push rates lower at the end of February, we are expecting rates to jump a bit; then continue rising to over 6%. Historically, still a great interest rate, but with buyers used to rates near 5%, this will have a cooling effect on sales.