A Realtor.com survey released Friday reveals that 65% of homeowners surveyed who plan to sell their homes within the next year are eager to enter the housing market within the next six months. Their eagerness comes after sitting on the sidelines as low mortgage rates fueled homebuyer demand and listing price growth throughout the COVID-19 pandemic.
Realtor.com commissioned HarrisX to conduct a national survey of consumers. The total sample size was 2,583 adults surveyed in late September. Although sellers' expectations for bidding wars and fast-paced sales have increased since this past spring, the potential uptick in new listings offers holiday hope to buyers challenged by the shortage of for-sale homes, the company said.
"Buyers should be ready for high asking prices and offer deadlines as seller expectations of the upcoming market are greater than in the spring, but an increase in new sellers could mean some relief from the inventory crunch," said George Ratiu, manager of economic research for Realtor.com. "As more homes have entered the for-sale market, price growth has moderated from the spring's double-digit levels to a more approachable 8% to 9% range," he said.
Ratiu also noted that seasonality will play a key role in seller activity levels as the typically-slower holiday period approaches, with new listings already slipping in recent weeks. "As buyers race against the clock of rising mortgage rates, sellers who price their homes in line with today's market and stick to their plans will likely see their expectations met," he said.
Among the highlights from the survey:
The majority of prospective sellers plan to list before the end of the year or in early 2022.
- Among homeowners who indicated they will enter the market in the next year, 65% expect to within six months, including 19% who have already listed their home.
- Compared to the spring (76%), more of today's prospective sellers (93%) have already taken steps toward listing their home, including working with an agent (28%).
- More than one-third of prospective sellers, at 36% each, have researched the value of their home and others in their neighborhood, as well as started making repairs or decluttering.
Consumers' top reasons for selling reflect the rising influence of more time spent at home during the COVID-19 pandemic.
- Compared to the spring (15%), nearly twice as many prospective sellers (33%) have realized they want different home features after spending more time at home.
- With more sellers having children at home this winter (65%) than in the spring (43%), family considerations are a top reason behind homeowner decisions to enter the market: 37% of prospective sellers say their home no longer meets their family's needs and 32% want to move closer to friends and family.
- This winter, the rise in remote work is also a key driver: 23% of sellers are looking for a home office, and 19% no longer need to live near their workplace, up from 6% in March.
Sellers have greater expectations of the current market this winter than in the spring.
- More than one-third of today's prospective sellers are eager to take advantage of the current market and think they can make a profit (35%), up from the spring (24%).
- When asked how the current market impacts the terms, they will ask for; top responses included asking for above what they think their home is currently worth (42%) and asking for a quick close (29%).
- Compared to the spring, more of today's prospective sellers anticipate that buyers will compete in bidding wars, offer above asking, forgo contingencies such as inspections and appraisals.
Today's prospective sellers plan to list in relatively affordable price ranges and are potentially more willing to compromise if their expectations aren't met.
- Sellers with homes at the market's core ($351,000 to $750,000) remained the same over March (29%). However, more sellers plan to list in the $500,001 to $750,000 price range, which overlaps with recent median listing prices in increasingly popular first-time buyer cities such as Riverside, Calif. ($540,000), Austin ($546,000), and Denver ($600,000).
- More than three-quarters (77%) of prospective sellers would be willing to accept a lower offer to close quickly versus just over half in March (54%).
- Compared to Spring sellers, a higher number of today's prospective sellers plan to take alternative routes like moving in with their families (19%), as well as temporarily renting their home back from the buyer (29%).