Articles on home sales fill the internet lately, and most people cite those statistics without doing a deeper dive, or having the background information to interpret the data. But it is imperative that you know where the numbers come from that influence your decisions related to buying a home, or selling your existing home, or both. And it is important that you understand your market well enough to truly understand what the data is telling you, or whether it even applies.
I just read a article that said existing home sales are down 2.6%. For many, that would be the end of the story. But in my market, if existing home sales are down at all, it is definitely not due to the economy; it is because there is a shortage of listings. In other words, MANY realtors have clients standing in line to buy existing homes, but there just aren’t any available to buy in their price point. IMPORTANT: If you are thinking of selling YOUR existing home, this is GREAT news for you! Supply is low and demand is VERY high. This means many thousands more dollars in your pocket! So in this case a 2.6% drop is not bad news. In fact, it’s a reason to celebrate. And that is in the Raleigh/Triangle market, not in Chattanooga.
Something else to consider is seasonal effect on data. Most folks don’t want to have their home on the market for sale during November and December, because of the holidays. And during summer vacation time, it’s not unusual to see a slow down in buying activity. It doesn’t predict gloom and doom for the market; rather, data predict typical human habits and traditions. I always have homes closing over both Thanksgiving and Christmas, so some folks clearly take advantage of the lower supply of homes and they list, or they take advantage of the holiday slowdown to take advantage of buying at potentially a lower price. See how this works? Make the data work in your favor by understanding it.
The other thing you need to dig out of these articles is the source of the data. I just looked at a chart showing lowest time on the market for existing homes. I know our time on the market here is much lower, on average, than what the chart showed. So I found the small print and saw that the data came from San Francisco CA, Billings MT, Chattanooga TN. This data had NOTHING to do with our local market. So be sure you know where these “stats” come from. In fact, in some neighborhoods, I can almost predict when a home will go under contract, based on that community’s time on the market. In the last case I examined, time on the market was about 40 days, lower than that chart indicated from these other areas.
The bottom line is this, and you’ve heard it a thousand times: Real estate is local. Now that sounds a bit ridiculous, right? But the saying is packed with truth. What happens in San Francisco has nothing to do with us, here in the Raleigh/Triangle market. Each day we have 60+ people moving here, needing homes. EACH DAY. So our market is always healthy, or healthier, than markets anywhere else in the US. This means if the economy crashes, we will slow down, but not as much as most other markets in the whole country. So don’t be afraid to buy, and I will beg: Please list your existing home. I can sell it! I probably have a buyer waiting.