The Impetus Behind Home Sales: It's More Than Just Interest Rates
According to a recent article published on July 31, 2023 by Zillow, nearly a quarter of homeowners in the U.S. intend to sell their homes in the next three years.
This is a rather significant revelation that comes at a time when many in the real estate sector are mulling over the future direction of the market.
Daryl Judy, an acclaimed industry expert, shared his insights on this trend and dissected the main reasons people are planning to sell. While many in the industry and the general public are engrossed in the trajectory of interest rates, Judy believes there's more to the story. Here's a deeper look into his perspective:
The Interest Rate Mirage:
Home No Longer Meets Needs:The core reason that spurs most homeowners to sell is when their current home no longer aligns with their needs. There are a few compelling reasons for this!
Anticipation of Appreciation:
A good number of homeowners are waiting on the sidelines, believing that their homes will appreciate further, ensuring a higher return when they do decide to sell. This sentiment is particularly pronounced among fee simple homeowners.
Growing Families Need Bigger Spaces:The age-old reason of needing more space remains one of the top factors driving sales. As families expand, the quest for a bigger home becomes imperative. No interest rate or market trend can deter a family in need of more room from making a move.
Upgrading Due to Increased Income:
Economic prosperity and career advancements mean that many homeowners now have more disposable income. This financial buoyancy makes it feasible for them to aspire to better homes that reflect their elevated lifestyle and preferences.
It's truly an eye-opener that data from June 2023 suggests that 1/4 of Americans are considering selling. This information is a game-changer, especially in a market grappling with inventory issues. It beckons industry stakeholders to understand that while interest rates are influential, the true motivators for homeowners to sell are often deeply personal, rooted in life changes, financial growth, and evolving aspirations.
With this understanding, real estate professionals can better position themselves to serve their clients, focusing not just on the numbers but also on the very human reasons that propel the market forward.
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