Real Estate News & Commentary

As U.S. Markets Shift in Favor of Buyers, is NOW the Time to Sell Your Properties?

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Co-founder of the world’s largest real estate brokerage Gary Keller has been calling a shift in the market for some time. Recent data may suggest that shift from a seller’s market to a buyer’s market is already here — at least in some destinations. What does that mean for owners and real estate investors?

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Data from The Wall Street Journal and National Association of Realtors shows that U.S. home sales began falling in July 2016. New statistics from RealtyTrac in September 2016 show that the average time to flip a home has extended to a new dramatic high of over 6 months. Additionally, vacant bank-owned properties have risen by 67% in 2016.

Related: How to Survive in All Market Phases (It’s About More Than Just Ensuring Cash Flow)

Many homeowners may need to step up their game to sell faster, though obviously a “buyer’s” market also signals a time for others to step up their investments or hold.


Is it Time for You to Sell Your Home?

If you really must sell your home in the next few years, have been hoping to move up, or may have a balloon mortgage or adjustable rate mortgage; this is high time to sell in many markets. Rising interest rates and softer sales could make this the best time to exit in the years ahead.

For regular homeowners, that may be a big wake-up call to get it listed or to cut the price on a listing to make sure you secure a sale.

Related: Is a Market Correction Imminent? Here’s Why NOW is the Time to Prepare.

As a real estate investor, you may also want to capitalize on this moment to optimize and restructure your portfolio. Maybe you have four single families you can sell and use those proceeds (via 1031 exchange preferably) as a down payment on a 100-unit multifamily building. Maybe you have held some properties for quite a while or have an aging multifamily and now is the time to liquidate and buy something recently remodeled.


When It’s Time to Hold

Don’t sell if your cash flow makes sense and your location still has room for growth. There may be small soft spots in the market, but real estate has proven to keep going up in the long run. Also, if you don’t have plans to reinvest or can’t see opportunities with better yields, then it’s best to simply not sell. Paying Uncle Sam on those capital gains can be a hard pill to swallow. So don’t sell unless you are really facing pressure to in the next few years.

Most investors will want to use this period to bulk up their income property portfolios, taking advantage of low rates and the few destinations that may still be undervalued and overlooked by the masses.

What do YOU think about current market conditions?

Let me know with a comment!

Sterling is an multifamily investor specializing in value-add apartments in Indianapolis and other Midwestern markets. With just under a decade of experience in the real estate industry, Sterling w...
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    Bill Neves Flipper/Rehabber from Vancouver, WA
    Replied almost 4 years ago
    First off, stating the obvious, Gary Keller is a lot smarter and more successful than me. I’m in the Portland, OR area. While I’ve never been a realtor, I’ve been investing since 1999 and specialized in Short Sales back in 2005-2008. Every 1st week of the month, Keller Williams (his company) in Portland would have me do a presentation on the How-Tos of Short Sales. My partner and I had more deals than we could handle because of these talks. We were doing 2-4 short sales/mo. It was a gold mine period… until the market crash. Everything is cyclical. I have contacts in the biz in several areas of the country. What we’re still seeing, and it’s not just in this area, is that due to the lack of inventory prices are super strong and a sellers market. At least for now. Again Mr Keller has his finger on a bigger pulse than I have. Lots of folks still cannot get a loan. Average income is down. Working part time or 2 part time jobs. Lost their job in the downturn/crash. Self employed. So rentals are going thru the roof. Last month’s numbers show average nationwide is $1222 for rentals. A local Sunday paper front page article says people are paying half their take home for rent. No easy loans for any of these. Most advertised loans are to do refis. Besides our investments – We just sold our home in Vancouver, WA in July so we are an outlier in these July numbers. We did NOT use a realtor due to the strong sellers market. We posted on Zillow “Make Me Move” for a ridiculously high price. It was almost $100k higher than “market”. We did have a unique house overlooking a lake. It sold in 2 weeks. We are now in our new home that we just moved to and made out like bandits on the sale of our other one. Could part of the numbers be that the ‘market’ (marketing) is saying “the numbers are changing. If you are going to sell, now is the time?” Every weekend is the best cell phone deal of the year, right? The cycle will definitely get back around to buyers market. ‘When’ is the question. So again I agree sell NOW if you are going to.