Ask a couple of people how the housing market is doing, and you’ll probably hear different answers. That’s because the market is moving in two very different directions right now, depending on the price point.
Knowing which track your home is on can make a big difference when you sell. It affects everything from your asking price to how long it may take to get an offer. Here’s what you need to know.
Home Sales Are Picking Up Speed at the Top of the Market
Mortgage rates and buyer competition are affecting the market differently at each price point. Look at recent sales data from the National Association of Realtors (NAR), and the trend becomes pretty clear.
Homes priced under $250,000 saw sales fall 2% to 3% from last year, while sales of homes priced above $750,000 jumped by double digits, as the graph below shows.
So, what’s causing this divide? Higher mortgage rates and years of rising home prices have made entry level homes harder for many buyers to afford, especially first time buyers. As a result, demand in that price range has slowed.
On the other hand, buyers shopping for higher priced homes tend to be less affected by higher mortgage rates. They often have more flexibility in their budgets, helped by a strong stock market and the equity they’ve built in their current homes.
That’s really what sets the two apart. Lower priced homes are still selling, but they’re taking longer because today’s mortgage rates have reduced the number of buyers who can comfortably afford their first home.
That’s why pricing and presentation matter more than ever, especially when you’re selling in this price range. Start with the right price instead of testing the market with a high one, make sure your home looks great online and in person, and work with an agent who can put your listing in front of the right buyers. That’s the best way to attract the buyers who are still looking and show them why your home is worth the price.
Why Some Homes Sit While Others Get Snapped Up
How quickly a home sells is changing by price point too, and the difference is pretty noticeable. Luxury homes used to take much longer to sell than starter homes, but according to Redfin, that gap has almost disappeared.
Buyers with bigger budgets are moving quickly when a well priced home in their price range hits the market. As Zillow puts it:
““The U.S. housing market is splitting in two. Luxury homes are selling at a faster pace than a year ago, with shrinking supply and growing bidding wars.”
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If your home falls into that price range, it could sell faster than you might expect. You may even see multiple offers. That kind of buyer competition makes having the right pricing and marketing strategy from day one even more important.
No matter which side of the market you’re on, knowing this upfront can help you have the smoothest sale possible.
What This Means for Your Sale
If you’re thinking about selling an entry level home, there’s no need to panic. Homes in your price range are still selling, but they’re taking a little longer than they did last year. That makes getting the price and presentation right even more important.
If you’re selling a move up or luxury home, you’re in a strong position right now. Buyers in this price range tend to be less affected by today’s rates, so they’re more active, and well priced homes are attracting real competition.
Either way, your price point plays the biggest role in how quickly your home sells and how much you get for it.
Bottom Line
Your home’s price point matters more right now than anything you’re hearing in the national headlines. Let’s figure out where your home fits in today’s market and create a pricing strategy that helps you get the price and timing you want.
