Should I Sell My House Now Or Wait?

If you’re thinking about selling your home, you’re probably wondering if now is the time to do it. With the recent volatility in the housing market, many sellers are on the fence. Home prices shot up in 2022 and 2023. But are they still rising, or are they on their way down? And when’s the best time to list a home?

Whether you’re asking yourself, “Should I sell my house now?” or just considering your options, you should know there’s no universally correct answer to this question. Market conditions will impact the sale of your home, but it’s also important to evaluate your personal circumstances and reasons for selling.

Let’s discuss the 2024 housing market. We’ll examine its market conditions to explore when you should and shouldn’t sell your home.

Real estate experts predict a continued housing shortage, and because they expect high buyer demand to keep pushing home prices up, 2024 may be an ideal time to sell. Experts also anticipate a leveling out of 2023’s elevated mortgage rates, expecting rates to eventually settle around 6% – 7% in the spring.

Lower mortgage rates and limited housing inventory will continue to make market conditions very competitive for buyers. In other words, we’ll still be in a seller’s market. If you sell your home, you may face intense competition to purchase your next one.

To make the best choice for your situation, you’ll need to weigh the pros and cons of each available option.

You have three main options:

1. List your home for sale
2. Hold off on listing your home until the market balances out
3. Stay in your home for the foreseeable future

The course of action you take will depend largely on your reasons for moving. If you need to relocate quickly for work, family or other reasons, you may make a different decision than a seller who just wants to downsize to a smaller home. You’ll need to research your local market to help you decide whether it’s a good idea to sell and take advantage of high sale prices or wait until it’s easier to buy your next home.

Here are a few factors to consider and help you decide when is the right time to sell:

If Mortgage Interest Rates Are Low

It may be a good time to sell your home and purchase a new one when mortgage interest rates are low. Lower interest rates mean you pay less in interest over the life of a home loan. In other words, you’ll save more money financing a new house.

Low rates can also be a double-edged sword for homeowners. Plummeting rates often create a lot of demand since buyers want to take advantage of low rates.

While you may be able to sell your home at a healthy profit, you may struggle to purchase a new home due to the crowded housing market. If you’re comfortable selling and buying a house at the same time, selling your house during a period of low rates may be a financially savvy choice.

If The Housing Market Supply Is Low

In a buyer’s market, there are more houses for sale than buyers, giving home buyers more leverage and negotiating power. In a seller’s market, fewer houses are for sale than buyers searching for new homes. In this situation, the seller has more negotiating power at the closing table – making a seller’s market a great time to sell your house.

When home buyers compete for fewer homes, the seller can often set a higher competitive asking price and may be less willing to compromise on contingencies and other requests.

Experts say the current seller's market will continue early into 2024 – but it won't last forever. Encouraged by a 5% year-to-date surge in newly constructed home sales, home builders are ramping production to meet demand. As builders create more inventory and more sellers enter the market, home buyers will have more homes to pick from.

While an increase in home buyers may seem like good news for home sellers at first, a surge in sellers and housing supply may produce more competition for sellers. As more homes come on the market, sellers will have less power to negotiate the price of their homes. Given these predicted increases, the best time to sell your house may be early 2024.

If You Need To Relocate

If you’re relocating, you may need to sell your house. If you’re in the market to buy a second house, this may not apply to you, but when homeowners need to move, they frequently sell their current home and buy a new one.

You may need to relocate for a new job, a smaller home, a larger home to accommodate a growing family, etc. If a personal reason is compelling you to sell your current home and purchase a new one, you should consider selling, especially if your reason is time-sensitive.

If Your Home’s Value Has Increased

One great bonus of a strong seller’s market is that your home’s value may have increased with demand. If your home appraises at a higher value, consider cashing in on your home equity by selling. Depending on how much your home has increased in value and how much equity you’ve built, you may make a substantial profit selling while homes are still in high demand.

If you’re not ready to sell but want to take advantage of your home’s boost in value, you can always explore other options. If you want to improve your home, a cash-out refinance may be a better solution, leaving you with money in your pocket and the home you love.

While there are good reasons to sell your house, there are also good reasons to consider waiting. Let’s go over a few scenarios when selling your home right away may not be the best choice.

If You Don’t Have Enough Home Equity

As you pay off the principal balance of your mortgage, you build equity in your home. If you have a lot of equity, you’ll profit more from the sale of your house. When you sell a home, you should make enough to pay off your remaining mortgage balance and closing costs. After all expenses are covered, the amount left over is your profit.

If you don’t have much equity in your home, you risk breaking even or losing money on the sale. This scenario can happen when the combined total of your outstanding mortgage balance(s) and closing costs exceed what you earned in the sale. When you have little to no equity in a home, your mortgage may be underwater, and you may take a financial loss when you sell your home.

What Is An Underwater Mortgage?

An underwater mortgage happens when the principal balance of a mortgage is higher than the home’s market value. An underwater mortgage can occur when a property’s value drops or a homeowner misses mortgage payments. A homeowner selling a house with an underwater mortgage may need to pay a significant amount out of pocket to complete the sale. This scenario may not be as common right now due to the high demand for homes.

If you haven’t built much equity in your home, consider waiting to sell until you can make a profit. Most experts recommend living in a home for about 5 years before selling to at least break even on the sale.

If The Housing Market Supply Is High

If the housing market is flooded with more homes than buyers – it’s a buyer’s market, and you should consider waiting to sell. Home sellers are at a distinct disadvantage in a buyer’s market. As the seller in this situation, you’ll be competing for the attention of buyers. You may have to sell your home for less or entertain buyer concessions and requests, such as handling repairs before the sale.

Even if the national housing market shifts to a buyer’s market, you can still sell your home in a buyer’s market. It’s just that it isn’t an advantageous market for sellers.

If You Can’t Afford The Next Purchase

If you can afford to sell your house but can’t cover the down payment on a new one, you should also wait to sell the home. Just because you can make enough to cover your existing mortgage and closing costs doesn’t mean you should sell. You’ll likely need a significant amount of capital to close on a new house, and for many home sellers, that capital often comes from the sale of their current home. Breaking even on a sale may not provide enough to cover closing costs, lender origination fees and the down payment.

If you don’t have enough savings to afford your next purchase, you may want to wait to sell your home.

If You Have Incomplete Home Renovations

If you’re in the middle of remodeling your kitchen, you might want to pump the brakes on listing your house. Incomplete home improvements can be a huge turnoff to potential buyers and drive them away. Finish any remodeling projects in progress before listing your house for sale.

If you need to move urgently and your renovations are in progress, talk to a real estate agent or REALTOR^® about your options. Depending on the state of the remodel, you may need to sell your home as is.

Review these commonly asked questions below to help you decide whether now is the right time to list a home for sale:

What is the best month to sell your house?

June and early summer months tend to be the best months to sell a house. Prospective home buyers with children typically want to move into a new home before they start school. And many buyers aren’t thrilled about attending open houses or moving during the cold winter months.

What is not worth fixing when selling a house?

When selling your home, there are some situations where not fixing something could be more beneficial to you than making repairs. In these instances, repairing may not provide a worthwhile return on investment. The repairs could also take longer than expected and slow the home selling process.

For example, some sellers may decide it’s not worth repairing:

• Cosmetic wear and tear
• Small cracks in the driveway or walkway
• Minor, non-hazardous home system problems
• Older appliances that still function safely

How much equity should I have in my home before selling?

The recommended amount of home equity before selling depends on why you want to sell your home. The general rule is about 10% equity if you’re selling to relocate and at least 15% if you want to upgrade to a bigger home.

It’s still a strong seller’s market, so it may be a great time to sell your home. Selling a house is a big decision that requires serious consideration of multiple factors. If you’re not confident you’re ready to sell, holding off is always an option. Be sure to research all your options before deciding to buy or sell to make sure you’re making the most financially informed decision.

If you’re ready to sell your house and purchase a new home, start the mortgage approval process online today.