Looking to Sell a Home? Here's Why You Should Consider Listing Before Summer

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KEY POINTS

  • Right now, home values are holding steady at sky-high levels.
  • Things could change if mortgage rates continue to climb and economic conditions worsen.

Moving quickly could work to your benefit.

If you're looking to purchase a home today, you may have quite the battle ahead of you. Not only is there a major lack of available homes on the market, but home prices are also sky-high.

In March, home prices were up 20.6% nationwide, according to the S&P CoreLogic Case-Shiller Home Price Index. And in some parts of the country, they're up even more.

But while soaring home prices are a bad thing for buyers, they're a great thing for sellers. The problem, though, is that we don't know how long today's prices will remain sustainable. And there's reason to believe that the housing market is heading for a slowdown. In light of that, if you're looking to sell your home, you may want to get moving before the summer kicks off. 

Sell while the market is hot

Right now, it's unquestionably a seller's market. But there's reason to believe the market will cool down in the coming months.

First, let's look at mortgage rates. Not only have they risen sharply since the start of the year, but they also have the potential to climb even more as the Federal Reserve moves forward with rate hikes.

If borrowing costs keep rising, buyers may decide that enough is enough -- and they may opt to put their plans to purchase a home on hold until mortgage rates become more affordable. If that happens, lower levels of demand could lead home prices to drop.

Furthermore, a number of financial experts are warning that a recession may be on the horizon. That doesn't mean we're in for the worst economic downturn we've ever seen. But if economic conditions do deteriorate, that could lead to fewer home buyers (whether due to job loss or general fears or uncertainty). And once again, if buyer demand declines, home prices are likely to follow suit.

Should sellers worry about a housing market crash?

While home prices could start to come down later this year, a housing market crash is unlikely. For that to happen, the supply of available homes would need to grossly outpace buyer demand. But since there are so few homes on the market right now, we're unlikely to experience such a wide disconnect.

What's more likely to happen is that home prices start to dip modestly, to the point where they actually become affordable again. That would be a great thing for buyers. But if you're a seller looking to make the most money possible on your home, then it could work to your benefit to list your home in the coming weeks rather than wait. 

Don't delay without good reason

We don't know what direction the real estate market will head in this summer. But there's reason to believe things could cool off. 

If you're eager to snag the highest sale price for your home, take a few weeks to interview real estate agents, declutter your living space, and get your home listed. Moving quickly could translate into a lot more money than what you might get by waiting to sell.

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