by Elizabeth Barry

There is no one-size-fits-all answer to this crucial question. Real estate markets change dramatically over time so it can be difficult to know when to buy or sell a home. Rumors and myths abound, so polish off your pocket protector and don your horn-rimmed glasses. It’s about to get nerdy as we take a deep dive into current market data and its implications. 

Home Inventory

Resale inventory in the Triangle is critically low and we are again nearing the historic lows we saw in January 2022. We currently have 15 and 24 days of inventory in Orange and Durham counties respectively. To put this in perspective, a neutral, or balanced, market typically has 5 to 6 months of inventory – numbers we haven’t seen in the Triangle since 2015. Low supply is good news for sellers, but we’ll explore the other side of that equation – demand – below.

Days on Market

We’ve had historic lows for days on market in the past few years. For perspective, the highest recorded average days on market for resale homes in Durham County is 110 days in March 2011. We reached an all-time low average of 6 days on market in July 2021. The current average is 43. This is a slight decrease from January, which might indicate demand is increasing as buyers become acclimated to higher interest rates. Despite very low inventory, decreased demand means buyers have the opportunity to find homes that have been on the market for a while.

Sales Price

Sales prices in the Triangle hit an all-time high last summer. February’s traditional resale averages of $399,482 for Durham County and $584,657 for Orange County are 15 and 12 percent lower than these highs respectively. This is clearly good news for buyers. If you’re selling, it is important to remember these are averages. Market readiness will definitely be rewarded. Making repairs, increasing your curb appeal and staging will set your home apart from the competition and fetch top dollar.

Financing

As I’m writing this, local mortgage interest rates are near 7 percent, which is still below the 7.75% national average from 1971 to present. Nonetheless, it is much higher than the record low of 2.65% in January 2021. Lower sales prices can help offset reduced buying power at these higher rates. Waiting until rates are lower to buy might seem like a good idea, but usually reduced rates result in more competition and increased prices, which can eliminate this perceived advantage. 

Due Diligence Fees 

Unprecedented competition resulted in skyrocketing due diligence fees over the last few years. Many buyers lacked the funds to be competitive. These fees are trending lower in 2023, which might also outweigh higher interest rates for some buyers. 

While your ultimate decision comes down to your personal circumstances, timeline, and finances, if you’ve read this far and you’re still wondering if now is a good time to sell your home, the answer in my opinion is yes. No one knows what the future holds. Right now, there is extremely low competition. To maximize your return on investment, work with your agent to identify improvements that will maximize showings, increase the likelihood of multiple offers and yield the most bang for your buck.

If you are in the market to buy, there is good news also. Longer days on market mean the average home now sells for a margin under list price we haven’t seen since January of 2020. Still, be patient. You might not win your first offer, but a winning strategy and strong total offer package can keep you from overpaying. As I mentioned above, waiting for lower interest rates likely means you will face increased competition and, therefore, higher prices.

Comments are closed.