The real estate market here in the Shenandoah Valley is actually similar to what is happening across the state and the country. Mortgage rates, although slightly higher, are still hovering around 3%, making homes affordable for most buyers. A simple chart from Freddie Mac shows why there are so many buyers looking to capitalize on these low rates.
The spring market is showing no signs of a slow down for buyer demand. According to the article published by KCM, there are six reasons why the housing market is not like 2008:
Mortgage standards are different
Prices are not out of control
We have a lack of homes to buy
New construction cannot make up the lack of inventory
Houses are not too expensive
People are equity rich
So, with many buyers ready to buy their next home, why are sellers hesitant to list?
Maybe it is because sellers are equity rich and have used that equity to refinance and upgrade their current homes? Maybe it is because sellers have all been sheltering in place and fear people traipsing through their homes? However, I think the biggest reason is sellers feel they have no where to go if they sell.
In this market sellers do need a "Plan B". In the "old" days of last year, your realtor could add a housing contingency, where your option to purchase the home was contingent on selling your current home. However, in this low inventory, high demand market, this may move you to the bottom of the pile in multiple offer situations. Buyers are currently coming with all cash offers or no contingencies to the contract. However, many homeowners cannot afford, or get lender approval, to buy another home without first selling their own. This is where a Plan B is needed. For Plan B, go ahead and sell your house before you start looking! This can be scary because you will be without a place to live. However, there are several choices for where you can go:
Sell and move into a short-term rental
Move in with family or friends
Move into an AirBnB
Utilize corporate housing
Utilize hotels and extended stay hotels
or finally enjoy the RV life
Choosing the right Realtor can make your time in short-term housing, well..., short! Here is what an experienced Realtor can do for you:
Expired Listings
Realtors can search homes that were on the market but did not sell. These homeowners may be hesitant to try again, but if a Realtor reaches out to them with a possible buyer, it may entice them to re-list.
Absentee Owners
A Realtor can also search the tax records and reach out to absentee owners. Absentee owners are owners that do not live in the house. The home may be being used as a rental, sitting vacant, or was just inherited. A conversation with a Realtor who has an interested buyer may encourage them to list.
Distressed Homes
A Realtor also has access to information on homes that are facing possible foreclosure because the owner has fallen behind on their mortgage. Since the potential buyer has cash in hand from the sale of their home, this would get cash in the hands of the current owner quickly. A fast closing can save the owner another late payment on their mortgage and a foreclosure.
Trustee Deeds
Some homes, where the owners have passed away, are held by a trustee. Trustees do not always want to move into the homes or mess with managing them as a rental. These trustees may be willing to list or have no choice if jointly inherited. A Realtor can research the local tax records, find these trustees, and reach out to them on your behalf. These homes also are a good source for you as a possible rental.
Scouting ("Farming") neighborhoods for potential homes
You have sold your home for a reason, so you are more than likely looking for certain requirements in your next home. These could include the style of the home (tudor, farmhouse), number of stories in the home, number of bedrooms, age of home, size of the lot, etc. Having access to the MLS and to tax records, a Realtor can search for these specific requirements and reach out to homeowners that meet those criteria. Sometimes the best homes to buy are not always listed.
A strong sellers market has its challenges for sellers and for buyers, but you do not have to go it alone. Have someone on your side that has your best interest in mind to avoid the frustration and the stress that can come from selling and buying a home.
Stacey Treadway is a licensed Realtor for the Commonwealth of VA working for Funkhouser Real Estate Group in Harrisonburg, VA.
Please visit her website to search home sales in the Shenandoah Valley or inquire about what your home may be worth. www.StaceyTreadway.com