According to a recent online survey of 637 of our agents, many are anticipating more buyers this fall following a particularly slow year. Sixty-one percent of our agents surveyed said now is the time to buy, with low interest rates cited as the number one reason to act now.
When it comes to balance of power, 46 percent of agents believe that buyers have the upper hand, while another 46 percent believe buyers and sellers are on equal footing. This is a huge shift from the spring selling season, where 34 percent of agents felt that sellers had the power. According to the survey results, this is the time for buyers to start making some real offers on properties that may be overvalued and have been on the market for over 60 days.
Below are some comments to the question-"Explain why it’s a good time to buy or sell"- which fairly represent a majority of the remarks out of almost 600 responses:
• Interest rates are at a historic low and home prices have stabilized at a reasonable, affordable level.
• Rates are fantastic, home sales are very competitive.
• Good amount of inventory, low interest rates.
• With the price of homes and low interest rates, it's a great time to buy.
• With winter and the holidays approaching, the supply of buyers will start to dwindle…so sellers have to sell now or hang on until spring.
• Low rates and recent move out of recession make remaining sellers anxious to sell at reasonable prices.
• Desirable area homes are receiving multiple offers due to a lack of inventory and qualified buyers are motivated by the lower interest rates.
• Interest rates are attractive for buyers, plus sellers are becoming more knowledgeable about the market and are being more realistic with the pricing of their home.
• Buyers seem concerned that interest rates are on the rise and sellers are seeing lover inventory as an opportunity.
• Interest rates are low, prices are low and inventory is high. It’s a buyer’s market.
While many agents agree that prices will rise after the holiday season, they also say the benefit to selling now is lower inventory, which means less competition. However, agents warn that sellers should keep in mind that the impending cold weather and limited selection may dissuade a huge influx of buyers willing to pay above-market prices this fall.
Buyers vs. Sellers
With current market conditions ceding some power to buyers, agents feel there is disconnect between changing market dynamics and seller expectations. Forty percent of agents say sellers are pricing their homes high and are willing to wait until the market values the home at their price.
For buyers, 81 percent are submitting offers lower than asking price and 25 percent of buyers are willing to walk away if they need to increase their offer to a price that will increase their mortgage payments, according to the survey.
The biggest challenge buyers face is lower inventory of homes (72 percent), followed by multiple offers on a house (36 percent), rising prices (14 percent), fatigue (20 percent) and rising mortgage rates (7 percent).
For sellers, 78 percent of agents say the biggest challenge is pricing their homes above market value. Several of our agents commented that sellers with unrealistic expectations are at a greater disadvantage. Their homes will stay on the market longer, while buyers want move-in ready homes and are willing to wait until they find one.
Suburbs vs. Cities
Contrary to the national polls, 74 percent of agents in this region report that people are remaining in the suburbs and only six percent of agents say their clients are relocating from the suburbs to the city. This may be partially attributable to the fact that 72 percent of agents find that the most common challenge for buyers in the Philadelphia region is the lack of inventory.
As interest rates are at a low and the housing market continues to improve, agents predict home prices will rise. Most agents will agree that the fall will be difficult on both sellers and buyers, but things will pick up with the warmer weather. While there are still too few buyers on the market, agents are optimistic that low interest rates will drive more momentum to the housing market this spring.
The survey was conducted online from mid-September to mid-October 2014 among all of our agents across the company’s footprint, including Atlantic, Berks, Bucks, Burlington, Camden, Cape May, Chester, Delaware, Gloucester, Lehigh, Mercer, Montgomery, New Castle, Northampton, Philadelphia, Kent and Salem Counties.