For many months now, property owners have been in a prime position to capitalize on the housing market's glaring lack of inventory. That's allowed them to command sky-high prices and enjoy generous offers stemming from bidding wars.
But now, the housing shortage that's plagued the market for months on end is finally starting to ease. And that means that everyday sellers and real estate investors looking to unload income properties may want to list their homes sooner rather than later, before the competition really picks up.
Housing inventory is finally up
While the U.S. real estate market still lacks inventory in a big way, listings are finally increasing to a notable degree. In June, active home listings rose 19% on an annual basis, according to Realtor.com. And while total housing inventory is at just about half of pre-pandemic levels, it's a positive development for buyers.
So should sellers be worried about this uptick in inventory? Not necessarily. Buyer demand is still very strong, and there's still not enough inventory to go around, which means sellers can retain their edge -- for now.
But those looking to sell a home or income property may want to get moving this summer rather than wait for housing inventory to pick up even more. More competition eats into sellers' advantage.
There's also rising mortgage rates to consider. Rates have dropped modestly over the past few weeks. Granted, they're still well above 2021 levels, but they're offering buyers a temporary reprieve.
But rates could easily start to climb later this summer or during the last quarter of the year. That could, in turn, push more buyers out of the market, so those looking to sell a home may want to get ahead of that.
Home prices are still soaring
While the housing supply crunch may finally be easing, home values are still holding steady. In June, the median listing price hit another record high of $450,000, reports Realtor.com. That represents an annual gain of 17%. So sellers who opt to list today are still looking at what could be some pretty sizable profits.
Is it time to sell without an agent?
In a normal housing market, it's generally advisable to contract with a real estate agent for a home sale. But in today's market, where homes are selling quickly and inventory is still shy of what's needed to meet buyer demand, engaging a real estate agent may not be necessary -- especially for seasoned real estate investors who have sold numerous homes.
Skipping the agent could mean pocketing more of a profit in the course of a home sale, though it could also mean having to do a lot more legwork, as well as handling negotiations directly. Sellers will need to weigh the pros and cons of going solo versus hiring an agent for help. But either way, those serious about selling a home may want to get their listings up soon -- before conditions grow even more favorable for buyers.