You've probably read over the past few years that the inventory of homes available for purchase in California has continued to decline. For the past five years, the number of homes available for purchase on the local market has decreased compared to the previous year. Because demand remains relatively stable, this typically means that home prices continue to rise (and continue to rise). Because of high interest rates, many sellers with 2-4% mortgages are reluctant to sell, move, or abandon their lower-interest mortgages. Buyers in this region are also less affected by rising interest rates than other entry-level markets, and all of these factors combine to keep prices high. I don't see this trend changing anytime soon. And if interest rates fall further, as expected, buyer demand will increase even further in pursuit of the already scarce supply of housing.
Q: I'm thinking of selling my house in 2024. What factors should I consider before making a decision?
A: Think about where you want to move and do your research. Many outlying areas used to be relatively cheap, but we're seeing prices go up in most areas. Think about the type of lifestyle you want. Do you want to escape the hustle and bustle of the city or walk to the vibrant downtown shopping area? Think about your needs. Do you need to be close to strong medical care, an airport, children, or parents? Talk to your family to see how the move will affect them. Maybe you're not moving because you want to be closer to your kids, and they're planning on moving out of the area anyway.
Please consult a tax accountant. There may be capital gains effects that need to be factored into the calculation. If you are working with a financial planner, talk to them about how the sale will impact your retirement and future plans.
Q: I have decided to sell, what should I do?
A: Learn all you can about your local market. What are buyers looking for? Ask yourself who my competitors are and what's selling fast and what's not selling fast in the market. Be honest with yourself. You love your home more than anyone else, so try to take emotions out of the equation. Remember, your house is not built with gold nails.
Decide whether to use the services of a local real estate agent. For most people in this sophisticated market, the answer is a clear yes, but know that you have options.
You'll probably want to spend some money to get your home into “showcase” condition. Buyers typically want a home in move-in ready condition and don't want to deal with all the deferred maintenance. Ask your real estate agent where you can buy to get the most bang for your buck.
Be aware of insurance issues. As local disasters (such as fires) occur frequently, insurance companies are looking for ways to minimize losses.Just because you have fire insurance doesn't mean it's meaningful.
Buyer's ability to purchase insurance. This may affect the selling price.
Vacant homes are generally easier to sell than occupied homes. If you have a way to move and make repairs and upgrades, it will save you money and headaches.
Typically, the decision to sell is made after months, if not years, of discussion, research, debate, and planning. This is probably the biggest financial transaction you will ever make in your life, so be patient and surround yourself with professionals you trust. their field.
Owen Halliday is a longtime Los Altos resident and real estate agent who manages the Sereno office in downtown Los Altos. Call (650) 492-0062 or email Owen@Sereno.com.