Selling your home? You may need to adjust expectations

Sales of newly-built single family homes fell more than 5% year-over-year in September, according to data out Tuesday from the Census Bureau. The median price of a new home fell, too — nearly 4% from a year ago, as builders cut prices to try to lure buyers.

Prices of existing homes, meanwhile, continued to rise in August, according to the latest Case-Shiller home price index. Nationally, home prices rose about 2%, which is less than overall inflation.

For so long, it was a great time to sell. If you put your house on the market, there was a good chance you’d get multiple offers over asking price. But these days, the buyers just aren’t there.

“We're seeing a near-record number of price cuts on homes,” said Jake Krimmel, senior economist at Realtor.com.

He said one in five sellers cut their asking price in September, and he expects a similar rate in October, epecially now that mortgage rates are over 7%.

Many people who’d like to buy a house — especially their first — are just holding off.

Ali Wolf, chief economist at housing data and consultancy firm Zonda, said this is frustrating for people who are looking to sell. But for most, it’s not dire.

“Right now, there's people I think that feel financially strapped,” she said. “But you don't have people that are losing their job and can't pay their mortgage.”

At least, not in large numbers like during the Great Recession. Today, Wolf said, most homeowners are financially stable.

“Unlike the mid-2000s where people shouldn't have bought homes, we have people that had good credit scores, that had good down payments, that bought homes, and then the value of their home has gone up,” she said.

So they may be at a point where they want to sell, but Chris Herbert at Harvard’s Joint Center for Housing Studies said most don’t have to.

“People are sitting on a lot of equity, are psychologically anchored to the price the houses were at a couple years ago, and so they're just not willing to accept a lower price,” he said.

Or at least, not significantly lower. Herbert said anyone who does need to sell right now — because they got a new job, or they’re having a kid, or retiring — might want to adjust their expectations.

“They're not going to sell their home the first week it goes on the market, and they may have to, you know, be willing to move on the price a bit,” he said.

But he said they will find a buyer, if they’re patient.