Today I wanted to go over what happened in 2013. 2013 was a wild ride! At the beginning of the year we had very low prices, or low hanging fruit, and this caused the buyers to rush into the market. Although we had a lot of buyers, the inventory was very low and as the buyers kept buying, the prices went up. At this same time, interest rates also were extremely low.
As prices began to rise, so did the inventory because the market realized that things were looking good for sellers. As this was happening, the interest rates began to rise and the market quickly leveled out. The prices stabilized, interest rates went up and buyers could buy less home ($10,000-$40,000 less) because prices went up $10,000-$20,000 on average and the 1% rise in interest rates dropped buying power by as much as $20,000.
Now, prices began to stabilize in the summer and they were very high and as autumn approached, inventory dropped. Right now, we’re back where we started; interest rates have dropped, inventory is going down and there a lot of buyers out there making now a great time to sell!
Thanks and have a great day!