We are truly deep in the throes of a seller’s market. This is not a new revelation by any means, but what’s taken place over the last couple of months would seem to suggest that sellers are in complete control. We’ve been in a seller’s market for sometime, but what’s taken place this year is quiet unexpected.
In 2013, a sense of urgency drove traditional buyers hoping to take advantage of still-affordable home prices and historically low mortgage rates. Buyers found selection limited and were often forced into bidding wars with investors and other buyers who paid cash. Sellers reaped the rewards in terms of quick sales, often above the asking price.
At the end of February property values had increased by 22% in Davis from last year. As of March 10th, home values adjusted to 17% year-to-date from 2013. These numbers will continue to fluctuate throughout this year and could equal or better last years 10% appreciation from 2012. This is not exclusive to just Davis, home values are up for the entire region and most of California.
A few homeowners have taken advantage of the circumstances presented by marketing their property in the beginning of this year instead of waiting for Spring or Summer. The meager supply of homes and the still strong demand from prospective buyers have created our current situation. Add in the fact that buyers are very much aware of the likelihood of a spike in mortgage rates and now you have that perfect storm for home sellers.
With so few homes on the market, sellers are using the auction strategy to sell their home. This involves putting your property on the market and reviewing offers on a specific date and time. Selecting a local, experienced agent that can tactfully and aggressively market your home works best using this approach. With multiple offers, there are less haggling over small issues and it puts even more pressure on a buyer to make their proposal as seller friendly as possible.
There are some issues that could have an effect on the rise in home prices, such as an increase in mortgage rates or sellers deciding simultaneously to sell their home, there by increasing supply and changing the dynamics of the supply and demand theory. It would take a lot to change the pendulum back in favor of the buyer anytime in the near future. Please visit my website www.JohnnyBrooksHomes.com for helpful tips on buying or selling a home and easy access to view local area homes for sale in Davis, California and the surrounding communities.