The real estate market has been booming this year. When the novel coronavius first started shutting down businesses across the country many feared housing prices would plummet. Surprisingly, this has not been the case. Record low interest rates are largely to credit for a rise in home purchases this year. Plus, with so many workers transitioning to work-from-home jobs their housing needs have changed. However, the industry does have one major problem. Housing inventory is extremely low. If you're looking to sell, the high demand along with low market inventory may help you get a better deal. You may be able to negotiate the commission your agent receives when you sell your home. 

Housing Inventory

Housing inventory is continuing to decline throughout the United States. On a National level, the number of homes listed for sale declined by 36.4% since August of 2019. By September of this year, housing inventory declined further to 39% less than inventory available in September of 2019. That 39% decrease is a difference of approximately 529,000 less homes for sale this September. Along with the number of homes already listed, the number of new listings is also decreasing. In September the number of new listings decreased by 13.8% compared to last year. 

The Massachusetts housing inventory has taken some of the biggest hits compared to national averages. In particular, the Providence, Rhode Island-Warwick, Massachusetts metro area has seen one of the largest housing inventory decreases. As of September inventory for that area had decreased by 53.2% compared to last year. 

Housing Demand

Housing prices are continuing to increase. On a national level listing prices had increased by 11.1% compared to September of last year. As a whole, listing prices in the North Eastern markets are increasing more than most of the U.S. Homes in this market have seen an increase of 12.8% overall this year. The Boston-Cambridge-Newton, MA-NH metropolitan area has seen an astounding increase in listing prices. That metro’s home prices have increased by 16.4%. 

Furthermore, the amount of time a home spends on the market is decreasing. Homes are selling faster than ever. In September, on a national level, the average home spent 54 days on the market.  That is 12 days less time than in September of 2019. As that is 3 days less than the average of August, 2020 set another record. This is the first time homes sold more quickly in September than they did in August. We are definitely witnessing an unusually busy housing market this fall. 

Negotiate

This year, Americans want to buy homes. However, there is no end to the current low housing inventory insight. This in combination with the high demand means that sellers have the power. Real estate agents need homes to list and that can work in your favor. Realtors work on commision. Those commissions typically vary and you can expect the real estate commission to be anywhere from 5-6% of the selling price of your home.

Typically, the selling agent and buying agent will each receive 2.5-3% of the selling price of your home. Negotiate and you may be able to get their typical commision rate lowered. All you really have to do is ask. The worst that can happen is that they say no. Be polite, respectful, and don’t ask for too much. Your agent is working for your best interest and needs to be paid too. However, getting your commission rate lowered by even a fraction of a percent can save you hundreds if not thousands of dollars in the long run. 

Final Thoughts

Current market trends mean you can currently sell your home for more and faster. There is no end to tight inventory conditions in sight. This means realtors want your house on the market. They need your home to sell. Negotiate your agreement with the real estate agent and you're going to be bringing home more money from that sale than ever. If you have questions about your home mortgage or are considering putting your home up for sale contact Peoples Choice Mortgage. We will help you get the ball rolling to sell your home and can assist you in finding the next home that's right for you.