Will The Seller's Housing Market Continue?

Over the past year, the greater Salt Lake City area has seen a strong seller’s market for housing – thanks in large part to a shortage of homes on the market, strong demand by buyers and mortgage interest rates that hovered near historic lows. But as 2017 gets underway, the question is whether that seller’s market will continue, especially given a recent uptick in interest rates.

Although mortgage rates remain relatively low by historical standards, the sudden increase in rates is one of several factors that could impact the housing market in the coming year: Will low inventory levels begin to rise? Will the job market remain strong and continue to grow? 

“2017 is probably going to skew more toward the seller’s market,” Svenja Gudell, chief economist at Zillow, told Inman. “Most markets will skew more toward seller’s markets, and even in the Midwest there are probably more seller’s markets than buyer’s markets compared to their own history.”

The economists did project that inventory levels will likely rise in 2017 and new construction will pick up as well, giving frustrated buyers a bit more to choose from. The upshot is that sellers might find that it will take a little longer to sell their property this year than it did in 2016.

However, the increase in listings and construction probably won’t be enough to offset pent-up demand from buyers as long as the job market remains strong. The National Association of REALTORS® publication, realtor.com, said the days of multiple offers and bids well over the asking price probably won’t go away in 2017 – although they may not get much worse from a buyer’s standpoint.

Citing rising mortgage rates and a shortage of affordable homes for sale, realtor com projected a smaller increase in sales in 2017 than last year and slightly slower price appreciation of about 4 percent on average nationally, down from 5 percent in 2016. “2017 will be a year of growth in both sales and prices, but that growth will be slower than what we’ve seen over the last three years,” according to Smoke.

No one knows for sure what will happen to interest rates or the housing market. But if you have been thinking about buying or selling your home, now may be a good time to make your move before rates go higher and while demand for housing remains strong. If you have any questions about the local housing market, please give me a call or send me an e-mail. I’m happy to help.

Best wishes on a happy and healthy new year!
Rosa Pace

Outlook for 2017: Will Seller's Housing Market Continue?

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