Every month I tell you inventory is still low. This is not only the case for San Diego County and North County, but also for most of California. What’s keeping people from selling their homes? The CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) recently surveyed Californians and found some interesting answers why homeowners aren’t selling.
AFFORDABILITY SQUEEZE
The survey found that an affordability squeeze is one of the major reasons why homeowners aren’t selling. Survey results show that 64 percent of homeowners who had considered selling aren’t because prices are too high. Lack of inventory is compounding this problem.
It’s not just higher prices creating this affordability crunch. Homeowners are concerned that property taxes on their next home will also be too high. Forty-four percent said higher home prices and higher taxes were reasons to stay put. (There are ways to avoid higher property taxes. In an upcoming post, I will discuss ways to transfer your taxable value from your current home to a replacement home.)
Mortgage rates and the cost of buying and selling are also playing a part in this decision. Of those who have mortgages, 77 percent of them have interest rates below five percent. Homeowners are concerned the mortgage rate on their next home will be too high.
RETIREMENT
Affordability isn’t the only factor keeping people in their homes. A large number of homeowners said they are keeping their current residence as their retirement home.
OTHER REASONS
There were several other reasons homeowners cited for not selling. Some are still waiting for values on their homes to increase even more than they already have. Others are worried about qualifying for financing, or are hanging on to larger homes for boomerang children or family members.
To see the full survey, view the PDF here, “The Truth About Homeowners – Why They’re Not Selling.” You can also find the details in C.A.R.’s news release, “Homeowners caught in affordability squeeze, are staying put, REALTOR® survey finds.”