Homeowners: Great Time to Sell, But Not to Buy and Here's Why

DALLAS, Nov. 15, 2017 /PRNewswire/ -- It's a seller's market thanks to low inventory, but according to ValueInsured's latest quarterly Modern Homebuyer Survey, many would-be sellers are hesitating to sell because of the high price they'd have to pay for their next home.

The survey, released today, found that 79 percent of homeowners believe now is a good time to sell a home. Two-thirds of homeowners are interested in actually selling their home "in the near future," up 8 percentage points from last quarter.

So why aren't they selling?
Of those homeowners who are interested in selling their home either to upgrade or downsize:

• 72 percent say they are concerned with timing the real estate market.
• 63 percent say now is a good time for them to sell, but not to buy, due to high home prices.
• 61 percent are "waiting until prices to buy are better to make a move."

"Homeowners in many cases are eager to sell but don't want to become buyers," said Joe Melendez, CEO of ValueInsured. "These homeowners have experienced a lot of home value volatility and see more uncertainties looming – tax reform, for example. By hesitating, these homeowners are actually controlling the market on both sides. Reassuring these individuals is the key to unlocking inventory."

These findings resonate with external data: 48 percent of the nation's top 50 housing markets are now considered "overvalued," CoreLogic reported last week.

While many have speculated that low refinance rates are keeping homeowners from pulling the trigger to sell, the survey found that this factor is less consequential than expected. Only 18 percent of homeowners looking to sell say they haven't because they don't want to give up their current low mortgage payment. On the other hand, more potential home sellers (26 percent) say they second guess their desire to sell because they don't want to pay brokers fees, new mortgage closing costs, capital gains taxes, and other associated expenses as it would weaken their buying power for their next home.

Overall confidence falling
Home buying hesitations mirror overall housing confidence, which is down this quarter among Americans overall and homeowners. The ValueInsured Housing Confidence Index recorded a score of 67.7 on a hundred-point scale, down 1 percentage point since August.

Millennials, a closely watched segment, are no exception. Millennial homeowners' housing confidence dropped by 3.7 percentage points this quarter to 77.7 – a total 7.7 percentage point drop and the lowest score since the quarterly survey began in spring 2016.

Trends homebuyers will regret
With low confidence, sky-high prices and minimal inventory, desperate times are driving some homebuyers to take extreme measures. The survey asked homebuyers what emerging home buying trends they think homebuyers will be most likely to regret, and here are the top five:

1. The "no inspection" trend – 58 percent
2. The "offer sight unseen" trend – 57 percent
3. The "co-buying with strangers" trend – 54 percent
4. The "cashing out from retirement savings" trend – 37 percent
5. The "tiny home" trend – 36 percent

What's next for homeowners?
Overall, 57 percent of all homeowners surveyed who are interested in selling and moving believe they will move from their current home within the next three years, though some say they may rent out their home or pass it on to family instead of selling it. And among millennial homeowners, more than a third (35 percent) say they're likely to change jobs soon, so they are waiting to see where that move takes them before selling to upgrade.

"Eventually, younger people move for jobs and empty nesters need to leave their five-bedroom homes," said Melendez. "Selling and buying are always fraught with worry about timing the market, and life events don't always cooperate. In any market, it's wise to explore all your options for protecting your hard-earned equity."

View and download the infographic here.

For additional findings from the ValueInsured Modern Homebuyer Survey visit valueinsured.com/trends.

Survey Methodology
The ValueInsured Modern Homebuyer Survey was conducted online by Equation Research on behalf of ValueInsured in October 2017 among a nationally representative sample of 1,019 American adults ages 18 and older. The ValueInsured Housing Confidence Index is the aggregate mean of seven multidimensional confidence measures collected through the Modern Homebuyer Survey, which is conducted once per quarter.

About ValueInsured
Based in Dallas, PVI Agency, LLC dba ValueInsured℠, is the only provider of down payment protection for modern homebuyers, giving them greater control and flexibility to sell their home even in a down market. ValueInsured's +Plus℠ down payment protection is available nationwide and is backed by one of the world's largest re-insurance companies, with over $8 billion in capital. http://www.valueinsured.com

Contact:
Mollie Holman
646-746-5611
[email protected]

SOURCE ValueInsured

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