In 2018 we saw the housing market slow considerably, beginning in April 2018, when mortgage interest rates began to climb in earnest. Rates ascend and descend as a natural part of our housing market, but the sheer speed of last year’s rate hikes caught Buyers and Sellers off-guard. When we’re preparing to spend hundreds of thousands of dollars to purchase our largest asset, surprise is never a good thing.

The stock market bumped up and down, affecting the down payments of many Buyers as they considered pulling money against their investments (401k and IRAs), political uncertainty, interest rate hikes, and Sellers caught unprepared to adjust their list prices to accommodate a rapidly changing market created a confluence of factors that, mixed together, produced an atmosphere of uncertainty, dissuading many Buyers from purchasing and causing many Sellers to either hold off, take their homes off the market and rent them out, or just wait in place for better times.

Here we are, almost a year later, interest rates (right now, this very moment) have bumped down, will bump back up, property prices are reducing to a range that many consider reasonable again, there is a lot of inventory to choose from, and being the adaptable humans we are, its clear we’re back in the game.
Signs abound that our housing market is starting to hop again.

We are seeing excitement ‘on the ground’ again, relief that the ultra-competitive market of the past appears to have relaxed, list prices adjusting to reflect a realistic market value that has prudently adjusted for today’s interest rates, Buyers are buying, and Sellers are selling. The market is coming back!

What does this mean if you want to SELL your property in 2019?
Fix what you can fix, beginning with health and safety-related actions items:
- Water heaters need to be strapped to structure (not to brick chimneys) with TWO water heater straps
- Smoke and CO Alarms need to be placed within 10’ of sleeping areas to be safely code compliant. (Even if you have alarms inside bedrooms, there need to be alarms outside bedrooms as well)
- If your roof is leaking, get it fixed
- If your basement has water in it, get it fixed
- If you have a wood stove, ensure it is certified with DEQ or remove it completely
- If you have an oil tank, get is inspected and/or decommissioned (if financially feasible)
- If you think you may have a sewer line issue, get it scoped to find out
All of these issues, if they are issues at all, will be discovered when the Buyer does inspections so, if you prefer knowledge over surprises, fix the health and safety items at your own speed, at an expense you are comfortable paying, rather than with a contractor the Buyer may specify, at a much higher price.

Be reasonable when deciding your list price.
Your agent does not control the market. If agents did, every house would be a million dollars.
The free market controls home prices. Your agent will tell you what has been happening in your area by presenting you with ‘Actives,’ ‘Pendings’ and ‘Solds’ - this is the data Buyers will be using when deciding what dollar amount to offer on your home and it is the data appraisers will also be using when assessing the value of your home. This matters because it determines the property’s value in the eyes of the bank providing the loan to the Buyer who is purchasing your home.
None of us can outsmart the data.

Is your home special?
All of our homes are special. The question is, “Is it ‘special’ in the right way, in a way that will appeal to Buyers?”
Listen to your agent. Agents go through homes as a part of their every-day professional lives.
They see a lot of ‘special’ homes. Your agent can tell you if your home is unique in a way the market will find appealing. If your home’s uniqueness is too taste-specific, listen to your agent about any changes that may need to be made to increase its appeal to a wider range of Buyers - the more eyes on it, the better the opportunity you’ll get a good price for your home.

Is your home clean?
I t needs to be squeaky-clean! Clean and tidy, including the insides of closets, cupboards, and cabinets, sells homes. All your memorabilia and personal items need to be safely packed away.
We aren’t selling you. We are selling your house.

What does this mean if you want to BUY your next home in 2019?
Get pre-qualified with a lender. To be candid; not the kind of pre-qualification you get with a conversation on the phone with a lender and that first pass via an automated Desktop Underwriter program (referred to in the lending industry as ‘DU’). That isn’t enough.
Get really pre-qualified: the kind that involves your lender taking a good, hard look at your debts, you submitting your taxes to your lender, the lender pulling your credit reports, a close examination of student loan debt, tax debt, medical debt - everything.
In 2018 we saw a record number of ‘sale fails’ because of Buyers’ ‘undisclosed debt’ issues; issues that do not show up on a credit report but that can kill a deal once discovered.
Avoid this pitfall altogether by going through the loan pre-qualification process in depth before you go out house shopping. You’ll save time, money, and you’ll be shopping in a price-range that you can comfortably afford.
Avoid being ‘House Rich and Cash Poor’ - Owning a home is lovely, but no one wants to be so indebted to their home that they cannot travel, enjoy hobbies, take time off, get a puppy, and make updates.
Don’t set yourself up to survive your home-ownership. Set yourself up to delight in it.

It’s a new year, new market, and home Buyers and Sellers have adjusted to the new real estate landscape. Let’s use our new knowledge to ensure our selling and buying adventures are as comfortable as possible.

Until next time, Happy House Hunting!

Amy Munsey