Four Signs that Your House Might Be Priced Too High?

Every seller wants to get their house sold quickly, get as much money as possible for it, and with as few headaches as possible. And chances are, you’re no different.

But did you know one of the biggest issues that could ruin your chances for success is the asking price for your home? Pricing your house correctly, from the very beginning, is one of the most important steps in the home selling process.

So, considering this, do you feel you are pricing your home right? Check out the following four signs your high asking price might be turning potential buyers away—and why leaning on your real estate agent is the best way to course correct.

1. You’re Not Getting Many Showings or Offers

As the great Jeff Foxworthy states, “Here is your sign”. This is your number one indicator that your home might be priced too high for existing market demand. If your home has been on the market for several weeks and only a few buyers have come to see it—or worse, you haven’t gotten any offers—it could be a clear indication the price isn’t matching up with market demand. This happens because many buyers who have been searching for a while can easily eliminate a home that seems overpriced from their list. Your real estate agent will coach you through this, so lean on their experience for what you may want to try to bring more buyers in, including considering a price cut.

2. Buyers Have Consistent Negative Feedback after Showings

If, after the showings, comments from potential buyers aren’t great, you may need to reconsider your pricing or address their concerns immediately, if possible. Feedback from showings cannot be understated to help you understand how buyers perceive your house. If they consistently mention that it’s overpriced compared to other homes they’ve seen, it’s time to rethink your pricing strategy.

Your agent will gather and analyze this feedback for you, so you can look at how your house stacks up in the market. They can also suggest specific improvements or staging changes to better justify your asking price, or recommend one that aligns with today’s buyer expectations. As the National Association of Realtors (NAR) explains:

“Based on all the data gathered, agents may make adjustments to the initial price recommendation. This could involve adjusting for market conditions, property uniqueness, or other factors that may impact the property's value.”

3. It’s Been on the Market for Too Long

That lack of interest will ultimately lead to the property sitting on the market without any serious offers. The longer it lingers, the more likely it is to raise red flags for buyers, who may wonder if something is wrong with it. Especially in today’s market with growing inventory, a long listing period means your house is stale – and that makes it even harder to sell.

Your real estate agent will be able to give you perspective on how quickly other homes in your area are selling and walk you through what’s working for other sellers. That way you can decide together if there’s something you want to do differently. As a Bankrate article says:

“Check with your agent about the average number of days homes spend on the market in your area. If your listing has been up significantly longer than average, that may be a sign to reduce the price.”

4. Your Neighbor’s House Sold Without an Issue

Here’s the last thing to watch out for: If similar homes in your area are selling faster than yours, it’s a clear sign that something is off. This could be due to a lack of upgrades, outdated features, or a less desirable location. It may also indicate that your home is priced too high.

Your agent will keep you updated on your competition and any changes you may need to make to keep your home competitive. One of the best things to do in this situation is to be as adaptive as possible. Your agent can provide advice on small updates that could increase your home’s appeal or how to adjust your strategy to align with the current market reality.

Bottom Line

Pricing a home correctly is both an art and a science. It requires a deep understanding of the market and buyer psychology. And when the price isn’t drawing in buyers, there’s no better resource than your agent on what you may want to do next. Here’s the revised version:

When the price isn’t attracting buyers, there’s no better resource than your agent for guidance on what to do next. If you find this information helpful and would like more details, feel free to reach out to us directly at 910.585.5772 or 910.858.8416.

• Frank Murphy | Realtor | Broker | Veteran | 🇺🇸
  w/ Frank & Tracy Murphy, LLC brokered by eXp Realty 🏡
  ftmrealty.com

How the Federal Reserve's Next Decision Could Shape the Future of the Housing Market

Now that September is here, all eyes are on the Federal Reserve (AKA the Fed). The overwhelming expectation is that they’ll cut the Federal Funds Rate at their upcoming meeting, driven primarily by recent signs that inflation is cooling and the job market is slowing down. Mark Zandi, Chief Economist at Moody’s Analytics, said:

“They’re ready to cut, just as long as we don’t get an inflation surprise between now and September, which we won’t.”

But what does this mean for the housing market and, more importantly, for you as a potential homebuyer or seller?

Why a Federal Funds Rate Cut Matters

The Federal Funds Rate is one of the critical factors influencing mortgage rates – things like the economy, geopolitical uncertainty, and more also have an impact.

When the Fed cuts the Federal Funds Rate, it signals what’s happening in the broader economy, and mortgage rates tend to respond. While a single rate cut might not lead to a dramatic drop in mortgage rates, it could contribute to the gradual decline that’s already happening.

As Mike Fratantoni, Chief Economist at the Mortgage Bankers Association (MBA), points out:

“Once the Fed kicks off a rate-cutting cycle, we do expect that mortgage rates will move somewhat lower.”

And any upcoming Federal Funds Rate cut likely won’t be a one-time event. Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), says:

“Generally, the rate-cutting cycle is not one-and-done. Six to eight rounds of rate cuts all through 2025 look likely.”

The Projected Impact on Mortgage Rates

Here’s what experts in the industry project for mortgage rates through 2025. One contributing factor to this ongoing gradual decline is the anticipated cuts from the Fed. The graph below shows the latest forecasts from Fannie Mae, MBA, NAR, and Wells Fargo (see graph below):

So, with recent improvements in inflation and signs of a cooling job market, a Federal Funds Rate cut is likely to lead to a moderate decline in mortgage rates (shown in the dotted lines). Here are two big reasons why that’s good news for both buyers and sellers:

1. It Helps Alleviate the Lock-In Effect

For current homeowners, lower mortgage rates could help ease the lock-in effect. That’s where people feel stuck within their current home because today’s rates are higher than what they locked in when they bought their current house.

If the fear of losing your low-rate mortgage and facing higher costs has kept you out of the market, a slight reduction in rates could make selling more attractive again. However, this isn’t expected to bring a flood of sellers to the market, as many homeowners may still be cautious about giving up their existing mortgage rate.

2. It Should Boost Buyer Activity

For potential homebuyers, any drop in mortgage rates will provide a more inviting housing market. Lower mortgage rates can reduce the overall cost of homeownership, making it more feasible for you if you’ve been waiting to make a move.

What Should You Do?

While a Federal Funds Rate cut is not expected to lead to drastically lower mortgage rates, it will likely contribute to the gradual decrease that’s already happening.

And while the anticipated rate cut represents a positive shift for the future of the housing market, it’s important to consider your options right now. Jacob Channel, Senior Economist at LendingTree, sums it up nicely:

“Timing the market is basically impossible. If you’re always waiting for perfect market conditions, you’re going to be waiting forever. Buy now only if it’s a good idea for you.”

Bottom Line

The expected Federal Funds Rate cut, driven by improving inflation and slower job growth, is likely to have a positive, though gradual, impact on mortgage rates. That could help unlock opportunities for you. When you’re ready, let’s connect. That way, you’ll be prepared to take action when the time is right for you.

According to recent data from Fannie Mae, nearly one in four people still believe that home prices will decrease over time. If you're concerned about this possibility, here’s what you need to know.

Much of that fear likely stems from what you hear in the media or read online. The fact that we are in an election year just maximizes the opinions surrounding this topic. However, it's important to remember that negative news tends to sell. This means you might not get the complete picture but just the clickbait version. As Jay Thompson, a Real Estate Industry Consultant, explains:

“Housing market headlines are everywhere. Many are quite sensational, ending with exclamation points or predicting impending doom for the industry. Clickbait, the sensationalizing of headlines and content, has been an issue since the dawn of the internet, and housing news is not immune to it.”

Here’s a look at the data to set the record straight.

Home Prices on the Rise: A Year of Growth

Case-Shiller releases a monthly report detailing the percentage of monthly changes in home prices. If you examine their data from January 2023 through the most recent numbers available, here’s what the actual data will show you:

Looking at this graph, what you notice may depend on which color draws your eye. If you focus on the green, you'll see that home prices have risen for most of the past year. However, you might only notice the two slight declines if you're drawn to the red. This selective focus is common in media coverage because negative news tends to attract more attention. As a result, these minor dips are often highlighted, which can obscure the overall trend of growth when you look at the entire housing market as a whole 

Here’s what the data actually shows: there's significantly more green on the graph than red. Even the two red bars are so slight that they're almost flat. Looking at the year as a whole, home prices still increased overall.

It's perfectly normal for home price growth to slow down in the winter. The days between Thanksgiving and late February/early March are typically slower in the real estate market. This seasonal trend occurs because fewer people move during the holidays and at the start of the year, reducing the upward pressure on home prices during this period. Consequently, even the green bars toward the end of the year show smaller price gains, reflecting this seasonal adjustment.

The overarching story is that prices went up last year, not down.

To sum all that up, the source for that data in the graph above, Case Shiller, explains it like this:

“Month-over-month numbers were relatively flat, . . . However, the annual growth was more significant for both indices, rising 7.4 percent and 6.6 percent, respectively.”

If expert organizations monitoring home price trends indicate that the slight dips are not a cause for concern, there's no reason to worry. Even Case-Shiller points out that these dips were virtually flat, emphasizing that home prices actually increased over the year. This underlines a stable market trend where overall growth outweighs minor fluctuations. While life has many uncertainties, fear over continued appreciation in housing should not be one of those worries.

Bottom Line

The data clearly shows that, overall, home prices have risen over the past year. There's no reason to believe that this upward trend won't continue. Let's chat if you have any questions about what's happening with home prices in our area. We closely monitor all seven counties (Moore, Hoke, Harnett, Cumberland, Lee, Robeson, and Scotland) near Fort Liberty (FKA Fort Bragg), NC. Even if you're not in these areas, we can still assist you or connect you with one of our vetted and preferred partner real estate agents. You can reach me at 910.585.5772 or Tracy at 910.633.9553. We are here to help with all your real estate needs.

In recent months, there's been widespread chatter about the current challenges every day Americans are facing when purchasing a home. While it's undeniable that affordability remains a concern, there are promising indications of slight improvement, with potential for further enhancement in the coming months. According to Elijah de la Campa, Senior Economist at Redfin,:

“We’re slowly climbing our way out of an affordability hole, but we have a long way to go. Rates have come down from their peak and are expected to fall again by the end of the year, which should make homebuying a little more affordable and incentivize buyers to come off the sidelines.”

Let's examine the most recent data concerning the three primary factors influencing home affordability: mortgage rates, housing prices, and wages.

1. Mortgage Rates

Mortgage rates have been volatile this year – bouncing around in the upper 6% to low 7% range after hitting a peak at the 8% mark last winter. That’s still quite a bit higher than where they were a couple of years ago. But there is a sliver of good news.

Despite the recent volatility, rates are still lower than they were last fall when they reached 8%. On top of that, most experts still think they’ll come down some over the course of the year. A recent article from Bright MLS explains:

“Expect rates to come down in the second half of 2024 but remain above 6% this year. Even a modest drop in rates will bring both more buyers and more sellers into the market.” 

Any drop in rates can make a difference for you. When rates go down, you can afford the home you really want more easily because your monthly payment would be lower.

2. Home Prices

The second big factor to think about is home prices. Most experts project they'll keep going up this year, but at a more normal pace. That’s because there are more homes on the market this year, but still not enough for everyone who wants to buy one. The graph below shows the latest 2024 home price forecasts from seven different organizations:

These forecasts are actually good news for you because it means the prices aren't likely to shoot up sky high like they did during the pandemic. That doesn’t mean they’re going to fall – they'll just rise at a slower pace.

3. Wages

One factor helping affordability right now is the fact that wages are rising. The graph below uses data from the Federal Reserve to show how wages have been growing over time:

Check out the blue dotted line. That shows how wages typically rise. If you look at the right side of the graph, you'll see wages are climbing even faster than normal right now.

Here’s how this helps you. If your income has increased, it's easier to afford a home because you don't have to spend as big of a percentage of your paycheck on your monthly mortgage payment.

Bottom Line

If you stack these factors up, you’ll see mortgage rates are still projected to come down a bit later this year, home prices are going up at a more moderate pace, and wages are growing quicker than normal. Those trends are a good sign for your ability to afford a home.

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