The 2016 housing market is going to be pretty different from what it was in 2015. If you are planning to sell your house this year, it is key to have a strong understanding of this year's basic market trends to make sure you can sell quickly and get the best possible price.
Understanding the current seller's market
According to CNN, 2016 is a seller's market. Of course, the exact location of your home will affect just how true this statement holds, but in general, the U.S. housing market is currently good for sellers. Nevertheless, it is important to note that it won't be quite as good for sellers in 2016 as it was in 2015.
Home prices have been rising since 2012, and the housing market has finally reached somewhat normal conditions. However, Lawrence Yun, chief economist for the National Association of Realtors, told the Home Buying Institute home sales will indeed continue to rise, but at a much slower pace. Yun said home sales will likely increase about 3 percent in 2016, compared to a 13 percent increase in 2015. While this does not mean it is a bad time to sell your home, it does mean it may take a little more effort than it would have last year.
One great thing for sellers: huge tax breaks are still in effect. CNN said that homeowners can continue to exclude capital gains from personal home sales for their taxes. This tax break is still the largest one available to the general taxpayer. It is important to note that this tax break only applies if the property you're selling is your primary place of residence. If you file jointly, you can exclude up to $500,000. Those who are single can exclude up to $250,000.
Determining your asking price
AOL Real Estate said you will receive varying advice from different real estate agents regarding how to price your home. Some agents promote overpricing with the idea that the more you ask for the more you are likely to receive. Others, however, believe underpricing your home will make it more appealing to buyers. Listing your home for a cheaper price than similar properties in the area could lead to a bidding war, which could result in the price of your home rising.
Regardless of which direction you choose, the Home Buying Institute said the price of your home has to be reasonable based on the current conditions of the market. How do you determine these conditions? Research homes in your area that are both similar to yours and have recently been sold. Take note of the prices they sold for. Doing so will give you a better idea of how much money buyers would be willing to offer for your home.
CNN explained even though the Federal Reserve's small raise in interest rates in December has not yet affected mortgage rates, it may begin to do so over time. If mortgages become more expensive, potential buyers will have more trouble affording expensive homes. Keep this in mind when pricing your home. Buyers won't be able to pay more than they can afford.
When to place your home on the market
According to AOL Real Estate, the best time time to place your home on the market is during spring and early summer. This will be especially important in 2016 due to the fact it's an election year.
"Election years mean uncertainty to a housing market," Atlanta Real Estate Agent Mike Minihan told AOL Real Estate. "If you are concerned that the election could potentially throw a wrench in the market, [spring and early summer] will be early enough in the year to get the house sold before wild speculation starts breeding fear in homebuyers."
No matter when you decide to sell your home, you have to make both its interior and exterior look appealing to the greatest number of people. You do this through a process called staging, which involves making any necessary home improvements, whether for looks, safety or efficiency before buyers come to view your home.
The Home Buying Institute said since fewer home sales will be made in 2016 than in 2015, staging is especially important. It's easy logic: When your house looks good, buyers will be more likely to want it. Make sure everything is in order, from painting and furniture placement to landscape and light fixtures. Rooms should not look cluttered. Home stager Jessica Dolan told AOL Real Estate that every room should also appear to have a purpose. Painting walls white can help brighten up your home, and fully functional front, closet and cabinet doors will make for some happy buyers.
These are just a few examples of how to stage your home, but there is so much more you can do to make sure it is in top shape for potential buyers. Nothing should be broken or damaged, and you should also remove anything that may be too specific to your taste. Neutral patterns and colors are more likely to have mass appeal.
Marketing your home
You can hire a real estate agent to help you market your home, but there also many ways you can help move the process along on your own. The Home Buying Institute recommended using websites like Zillow and Trulia to list your home. In addition, get your home out there through social media and let word spread that you've placed your home on the market by telling your friends, family and coworkers.