One in Five Home Sellers Is Listing Now in Order to Pull Out a Profit
SEATTLE — November 12, 2015 — Results of the latest Redfin Real-Time Home-Seller Survey showed signs that the market is approaching normalcy and that seller optimism is very high this fall, according to Redfin (www.redfin.com), the next generation real estate brokerage. When asked why they’re selling their homes now, respondents to Redfin’s survey of 730 home sellers were more likely to cite typical life-cycle motivators like upgrading or downsizing, than wanting to get another home under contract before a looming mortgage rate hike.
Last year, 59 percent of sellers cited buying another house before prices or interest rates rise as a top reason to sell. This October, just 16 percent of sellers listed that reason, reflecting the fact that interest rates remain at historically low levels and have been low on buyers’ lists of worries this year. Sellers’ most common responses were wanting a larger or nicer home (29%), relocating to a new city (27%) and wanting a smaller home (21%). This is a big change in sentiment from our October 2014 seller survey, when concern that mortgage rates and home prices would soon rise was home sellers’ most common motivation.
After normal life-cycle drivers like upgrading, downsizing or family changes, sellers’ most common reason for listing now was to pull out a profit they’ve made on their home since buying it, with 20 percent selecting that response. Home sellers in Denver reported using the equity they built up on homes they bought two to three years ago to pay for graduate school and start small businesses.
“Seller optimism is flying high right now,” Redfin chief economist Nela Richardson said. “But buyers are more grounded now and pricing a home too high is risky. More sellers are having to drop their initial asking price this fall than a year ago.”
When asked about their concerns about selling, respondents voiced general economic conditions discouraging buyers (32%), not finding another home they want (28%) and prices falling before their home sells (28%) as their most common concerns about selling.
The Redfin Real-Time Home-Seller Survey is a companion to the quarterly Buyer Survey and Agent Survey. Click here to view the full report, including charts and graphs. Additional data is also available by contacting press@redfin.com.
About the Q3 2015 Redfin Real-Time Seller Survey
This survey was conducted between October 18 and 20, and respondents included 730 current and potential sellers. Respondents spanned markets in 23 states in the U.S., including West: Denver, Los Angeles, Las Vegas, Orange County, CA, Phoenix, Portland, Riverside-San Bernardino, CA, Sacramento, San Diego, San Jose, San Francisco, Seattle, Ventura County, CA; South: Atlanta, Austin, Baltimore, Dallas – Fort Worth, Fort Lauderdale, Houston, Raleigh, San Antonio, Washington, D.C., West Palm Beach, FL; Midwest: Chicago, Minneapolis-St. Paul, Madison, Milwaukee, Northeast: Boston, New York City (Bronx and Queens), Philadelphia, Rhode Island, Upstate New York.
