Why You Shouldn’t Be Afraid to Sell in Today’s Low Inventory Market

It is no secret these days that homebuyer demand is higher than ever before. A change in needs of a home, an increased desire in spending time outdoors, and record-low mortgage rates have all caused a major spike in demand that have caused homes to sell just as fast as they were put on the market! Due to low inventory levels of homes for sale, homes that do go on the market are worth more and face far less competition. Selling your home now means getting the most money for your home and the easiest transaction. Like many others, you want to sell your home and take advantage of the current market conditions, but you have reservations:

● If my home sells quickly, will I have time to find a new home to buy?

● Where will I find a new home to buy with such low inventory?

We are here to tell you that you should not be afraid to sell in today’s market, simply because the benefits outweigh the concerns, and more importantly… you have more options than you think to ensure you have time to find a new home you love before your home officially sells.

First, let’s talk about the benefits.

1. Higher Prices

With so many more buyers in the market than homes available for sale, bidding wars, a situation in which two or more parties repeatedly outbid each other as they compete to purchase something, are extremely common. Not to mention, the average amount of offers on a home is 4.7, meaning regardless, you will be receiving lots of offers that will all try to stand out. This buyer competition drives home prices up. This can work to your advantage, potentially netting you more for your house when you close the deal.

2. Greater Return on your Investment

Rising prices mean homes are also gaining value, which drives an increase in the equity you have in your home. In Minnesota specifically, the average homeowner has gained $21,000 of home equity in the past year! This major growth in equity gives you the ability to use that money for a down payment on your next home or to keep it as extra savings.

3. Better Terms

When you are selling your home in a low inventory market, there are many more people interested in your house. That means they are much more willing to compromise on details of the transaction than they would be at any other time. As a seller, this gives you the power to sell on your own terms! Oftentimes, buyers are willing to offer more money, waive contingencies or inspections, and any other finer details that could make them the front runner to buy your home. This means your transaction will likely be easier than it would be in any other type of market.

Itasca County real estate market for Feb. 2021

New listings Feb. 2021 - (53) vs Feb. 2020 - (82) a decrease of 35.4%

Closed Sales Feb. 2021 - (47) vs Feb. 2020 - (60) a increase of 16.1%

Avg Sale Price Feb. 2021 - $180,662 vs Feb. 2020 - $160,721 a increase of 12.4%

Homes for sale. Feb. 2021 - (167) vs Feb. 2020 - (484) a decrease of 65.5%

Currently there is a 1.4 months supply of homes for sale based on the absorption rate of the market.

It is still a sellers market out there. Low inventory, coupled with strong buyer demand. If you are thinking of selling, now is the time! Give us a call 218-326-0323. We have a list of buyers pre-approved and ready to purchase.

These numbers are from the Itasca Board of realtors.

Is right now a seller's market and what does that mean?

If you have been thinking about selling your home, you most likely have been doing some research about the real estate market right now - and you’ve probably seen the term “Seller’s Market” used quite a bit to describe the market currently. But, what does that mean? Why is it important to acknowledge this when thinking about selling your home? Keep reading to find out.

What exactly is a seller’s market?

A seller's market is a market condition characterized by a shortage of goods available for sale, resulting in pricing power for the seller. A seller's market is a term commonly applied to the property market when low supply meets high demand.To put it simply, a seller’s market means that the real estate market is currently working in favor of the seller.

Why is this important?

A seller’s market is the ideal condition to sell in because it means a much easier and favorable real estate transaction (and overall experience) for you. It often means more showings, more offers (many of which are over asking price), a higher price, less time on the market, and less competition. Low inventory and high demand means that buyers are more competitive than ever, and are looking at your home more so than before.

What does the current seller’s market look like?

Currently, the market is more favorable to sellers than ever before! Due to record-low mortgage rates, homes are more affordable to a larger multitude of buyers - and with many people’s lifestyles and needs changing in the past year, it seems like EVERYONE is looking to make a move! In Minnesota specifically, there has been a huge increase in demand as interest for the outdoors and an “escape” has become prominent. There has never been a better time to sell your home - if you don’t believe us, check out these statistics below from the National Association of Realtors.

Days on the market

Compared to last year, homes are selling in half the time. The January 2020 average days on the market was 43 days, whereas today, the average is 21 days. This means it is likely that you will have a much faster overall transaction!

Bidding Wars

Homes are now getting more offers, meaning bidding wars are much more common. The average in January of 2020 was 2.3 offers - but it has risen to 3.7 offers in 2021. This likely means you not only will receive more offers, but these offers will be higher quality and could potentially be over asking price or exclude certain contingencies to make for an easier sale.

Sales Price

Nationally, the average sales price has increased by 14.1%. In January of 2020, the national average was $266,300. Now in 2021, it is $303,900. That means your home’s market value will likely be more than you think, and could earn you more than you expected.

Over the past year, potential sellers have gained an unprecedented opportunity to sell with amazing success. As spring arrives more homes will begin to come onto the market, and these numbers will change. Act now and ensure that your home stands out and receives the best possible results! If you are interested in selling, reach out to us! We are working with many serious, qualified buyers that could result in selling your home before it even hits the market.

Itasca real estate market for Jan 2021

New listings Jan. 2021 - (37) vs Jan. 2020 - (77) a decrease of 51.9%

Closed Sales Jan. 2021 - (69) vs Jan. 2020 - (41) a increase of 68.3%

Avg Sale Price Jan. 2021 - $234.329 vs Jan. 2020 - $163,319 a increase of 43.5%

Homes for sale. Jan. 2021 - (177) vs Jan. 2020 - (499) a decrease of 64.5%

Currently there is a 1.5 months supply of homes for sale based on the absorption rate of the market.

It is still a sellers market out there. Low inventory, coupled with strong buyer demand. If you are thinking of selling, now is the time! Give us a call 218-326-0323.

These numbers are from the Itasca Board of realtors.

Should you wait for Lower Mortgage Rates to buy a new home?

For many, mortgage rates are the deciding factor in whether or not to buy a new home. Compared to relatively high rates in the past few years, we saw historically low rates in 2020 - hitting new record-lows 16 times, reaching a low of 2.72% for the year (compared to rates of 3.97% in 2019). As a result, buying a home has been much more affordable, encouraging many potential homebuyers to move forward with their plans.

Many hopeful homebuyers are now wondering if they should put their plans on hold and wait for even lower rates as they seem to continue to decrease. However, this may not be the right move. The reality is that these rates will not last forever, and with such uncertain times ahead, acting sooner rather than later may be the actual win if you’re ready to buy a home.

Rates will not stay this low.

While only a slight increase in mortgage rates is projected for 2021, some experts believe they will in fact continue to slowly rise from here on out. For example, since the start of 2021, the average rate has increased slightly to around 2.85%. Although this is not a major increase and is significantly low compared to previous years, it is a tell-tale sign that as the country returns to normalcy, rates will continue to do the same. Seeing this trend, borrowers are smart to take advantage of lower rates now before they increase - it is not worth the risk of waiting it out when making such a huge financial decision. Rates can change in an instant!

Why does it matter?

As mortgage rates continue to rise, the overall cost of purchasing a home will continue to increase as well. That means the higher the mortgage rate, the higher your monthly payment will be - especially considering home prices are still rising as well due to current market conditions like low inventory and high demand. It is likely that homes will never again be as affordable as they are right now. This is important to note as you could sell your home at a higher price than normal and also benefit from a lower monthly payment when purchasing your next home. Making a move right now means getting the most value and the best deal! This is also essential for buyers to note who are looking to upgrade to a bigger home that may have been out of their price range in the past - now is the time to do it.

What does this all mean?

As more buyers continue to hit the market - especially as the typically busy spring market fast approaches, it will likely become even harder to find a home in the coming months. It is much better to take advantage of the low rates that are available now, rather than waiting for a future decline that may never come.

If you are considering buying a home or making a move, reach out and let us help you decide if now is the right time for you!

IS NOW THE RIGHT TIME TO SELL YOUR HOME?

You may be on the fence about selling your home right now. Many people wait until spring or summer, but NOW is the right time - here is why. Demand is sky-high, supply is low, and buyer competition is fierce. As real estate professionals, we are always working to provide you with current and relevant information to make the most informed decision that you can as a homeowner. Continue reading for even more information on the current market and what it would mean for you as a seller.

HOME SHOWINGS

Home showings are often a tell-tale sign of how successful your home will be on the market. It shows people are interested in looking further into your home and want to learn more. Compared to this time last year, home showings are currently up by +47.2%! This means that many homes are seeing almost DOUBLE the amount of home showings than the previous year. As a seller, this means you will have much more activity if you sell right now and will likely have many people interested in your home.

INVENTORY

Many people do not consider inventory when deciding whether or not to sell - but it is a very important factor. Currently, inventory of houses for sale is down by -43%, a significant decrease since last year. This is a VERY good thing for someone who is interested in potentially selling their home. Why? Because it means less competition - and a lot more eyes on your home than ever before. Due to many people holding out until Spring to sell their home, there are so few homes on the market that buyers do not have many choices and therefore are much more likely to be interested in your home than if there were more available options. Your home is likely to get way more attention now than if you were to wait to sell in a market when everyone else is trying to sell as well.

COMPETITIVE BUYERS

Due to low inventory, competition is fierce! The market is oversaturated with buyers who are extremely serious and eager to find a new home. According to the NAR, bidding wars have increased to an average of about 3+ offers (although many homes see many more than this). Buyers are more competitive than ever and are willing to pay more or compromise on other fine details in order to stand out from others. As a seller, this puts you in total control and allows you to not only be confident that you will get multiple offers, but will be able to sell on your own terms.

So, to answer the big question - YES! Selling right now means more attention, less competition, and an easier selling experience on your own terms. These are market conditions we have not seen in a long time and will not last for long, so do not wait! Reach out to us if you have any questions about how your home fits into the market or how we can help you to sell your home.

New septic Compliance rule change

New, starting January 1, 2021, the Minnesota Pollution Control agency updated the rule for subsurface sewer treatment systems (SSTS) more commonly know as septic systems.

The rule change now mandates the septic tank will need to be pumped prior to checking the tank for compliance. Also, you will still need to have the drainfield checked for compliance to get a fully compliant certificate. 

This rule change did not create a statewide mandatory septic inspection at the point of sale. Itasca County still allows property owners to sell their properties that have existing septic systems without requiring an inspection or a compliant certificate at the point of sale. 

In Itasca County, the new owner would have 2 years from the point of sale to have the septic system inspected and if it is found non-compliant, to bring it into compliance.

If you have questions please reach out to one of our agents and they will get you additional information.

We have buyers! We need sellers!

Century 21 Land of Lakes has a large database of buyers currently looking for all types of properties.

Here are a few of them:

3 bedroom lake home/cabin on Pokegama lake with garage and/or storage shed, sand shoreline, price range is up to $400,000.

2 plus bedroom lake home/cabin on Moose, Deer, Wabana or Trout lakes. Garage or storage shed, privacy, price range up to $350,000

3 bedroom acreages within 20 miles of Grand Rapids MN, prefer a garage or storage sheds, up to $250,000

These are just a few of the buyers we are currently working with that are pre-approved and ready to buy. If you're thinking of selling give us a call at 218-326-0323.

Why NOW is the best time to sell your home

If you’ve been thinking about making a move - whether it be to upgrade, downsize, or move to a new location, you may be wondering when the right time to sell your home will be this year. Many homeowners wait until the spring to start considering, but the real estate market has been booming ever since 2020, and these results have carried into the beginning of 2021. In fact, the market is hotter than EVER before, and that’s something to take advantage of!

Below are just a few of the many reasons why now is the best time to sell your home, and why you shouldn’t wait to do so.

1. Buyer demand is higher than ever

Buyer demand has skyrocketed all over the country - and due to a large increase in the desire for vacation homes with woods, water, and more outdoor space, demand in Minnesota has seen a significant increase specifically! Minnesota has seen a 16% increase in home sales since last year, and the percentage continues to grow. What does this mean for you as a seller? There are LOTS of buyers out there that are bound to be looking for a home just like yours. Buyers are more competitive than ever, meaning you will most likely receive more of a variety of offers, and can sell on your own terms!

2. Mortgage Rates are the lowest they’ve ever been

In 2020, mortgage rates hit all-time lows 16 times. Continued low rates have set buyers up for significant long-term gains. What this means is that it is less expensive to borrow money for a home loan today than it has been in years past. More buyers are qualifying for homes that wouldn't have qualified at a higher interest rate. All of this results in more buyers eager to look for a new home, and they are more likely to pay more for one!

3. Inventory is extremely low

Nationally, we are seeing a shortage in inventory, meaning there are not enough homes to meet buyer demands. According to the National Association of Realtors (NAR), inventory available today is 2.3-month supply at the current sales pace, which is down from a 2.5-month supply. This record-low inventory is not even half of what we need for a normal or neutral housing market, which should have a 6.0-month supply. In Minnesota specifically, there has been a 36% percent drop in inventory. As a seller, this is a very good thing. This not only plays into receiving more offers and being able to sell on your own terms, but it means that your home will have less competition and thus more eyes on it. Due to this low inventory and high buyer demand, homes are selling faster than ever - your home will probably spend less time than average on the market.

4. Home Equity is rising Today’s low inventory of homes on the market is contributing to home price appreciation. Homes are worth more than they ever have been before, because a home for sale is so hard to find! In Minnesota, home prices went up 9.3% in 2020 compared to 2019, from $259,000 to $283,075 - and they are expected to stay consistent (if not increase) in early 2021. That means your home’s market value has likely risen, and you could be selling your home for more money than ever before!

Although the outlook of the real estate market continues to look optimistic for early 2021, these numbers are likely to change later on in the year. It is important to take advantage of this seller’s market and make a move now before things change! These record numbers mean a quick and satisfying selling experience, having the opportunity to negotiate the best possible contracts with buyers who are up against intense competition for finding their dream home.

This sweet spot won’t last forever - come talk to us before more homes are put on the market! We are currently working with multiple different buyers who are eager to find their next home and we might be able to sell your home before it even hits the market

Itasca county Dec 2020 real estate market numbers.

New Listings: 34 listings in 2019 compared to 42 listings in 2020, an increase of 23.5% 

Pending Sales: 2019 had 40 pending sales vs 2020 with 65 pending sales, an increase of 62.5% 

Closed Sales: 2019 had 72 closed sales vs Dec 2020 with 93 closed sales, an increase of 29.2%

Avg. Sale Price: 2019 was $173,615 vs Dec 2020 with $208,162, an increase of 19.9%

Monthly supply of homes for sale: Dec 2019 had 5.1 months of supply vs Dec 2020 with 1.6 months of supply. 

As the numbers above show it is a sellers market!  Now is the time to list your home in the greater Grand Rapids MN area. Give us a call if you or anyone you know is thinking about selling at 218.326.0323.