Why Right Now Is a Once-in-a-Lifetime Opportunity for Sellers
If you’re thinking about selling your house in 2022, you truly
have a once-in-a-lifetime opportunity at your fingertips. When selling
anything, you always hope for strong demand for the item coupled with a limited supply. That maximizes your leverage when you’re negotiating the sale. Home sellers are in that exact situation right now. Here’s why.
Demand Is Very Strong
According to the latest Existing Home Sales Report from the National Association of Realtors
(NAR), 6.18 million homes were sold in 2021. This was the largest
number of home sales in 15 years. Lawrence Yun, Chief Economist for NAR,
“Sales for the entire year finished strong, reaching the highest annual level since 2006.
. . . With mortgage rates expected to rise in 2022, it's likely that a
portion of December buyers were intent on avoiding the inevitable rate
Demand isn’t expected to weaken this year, either. In addition, the Mortgage Finance Forecast, published last week by the Mortgage Bankers’ Association (MBA), calls for existing-home sales to reach 6.4 million homes this year.
Supply Is Very Limited
The same sales report from NAR also reveals the months’ supply of inventory just hit the lowest number of the century. It notes:
inventory at the end of December amounted to 910,000 units, down 18%
from November and down 14.2% from one year ago (1.06 million). Unsold
inventory sits at a 1.8-month supply at the present sales pace, down
from 2.1 months in November and from 1.9 months in December 2020.”
The reality is, inventory decreases every year in December. That’s
just how the typical seasonal trend goes in real estate. However, the
following graph emphasizes how this December was lower than any other
December going all the way back to 1999.
Right Now, Sellers Have Maximum Leverage
As mentioned above, when there’s strong demand for an item and a limited supply of it available, the seller has maximum leverage
in the negotiation. In the case of homeowners who are thinking about
selling, there may never be a better time than right now. While demand
is this high and inventory is this low, you’ll have leverage in all aspects of the sale of your house.