Get Moving! How Home Sellers Are Making the Most of The Market

IT WAS FUN WHILE IT LASTED

This is clearly the only way for home sellers to look at it. In the world of Real Estate, change is good. Just imagine what would happen to the market if our recent upsurge in home prices and extreme seller’s market had continued unchecked. Fantastic for home sellers you say? Not for long. Home buyers would disappear (this had already begun to happen) and the market would inevitably collapse. We’ve experienced similar fallout in the past resulting in a catastrophic number of foreclosures, short-sales and plummeting home prices, and unless something changed, it would have happened again. Hence the FED’s recent increase in interest rates.

Mortgage interest rates may be climbing, but the meteoric rise in home prices is beginning to reverse and we’re recovering a modicum of balance in our Real Estate market.

I was impressed by something I read nearly a year ago in a California appraiser’s blog. It really stuck with me because the forecasts and recommendations contained in Ryan Lundquist’s Sacramento Appraisal Blog regarding the market and what we should all be looking out for, are dead-on as applied to the current Real Estate environment here in Arizona. The post is definitely worth a read!

I’ve focused on a few of the highlights in Ryan’s post, such as advising Sellers that they must recognize “You’ve lost power”. This is decidedly true. Home Buyers have reclaimed the ability to negotiate both price and condition- a positive step toward a more balanced market. This is not to say that home sellers are powerless, just that the equalization of clout is returning.

In light of higher interest rates, home buyers have become more selective about location, price and condition of the homes they choose. Buyers are acutely aware of the affect that the fluctuating mortgage rate is having on their monthly payments. Investors are disappearing, career cash buyers and e-Buyers have all but faded away. Similarly, illadvised contingencies such as waiving appraisals and home inspections, and frenzied bidding wars are no more. This means a larger percentage of buyers are getting mortgages and it is crucial that the property appraises.

Competitive pricing is more important than ever and viewing purchase contract terms with a more realistic eye is essential. Carefully weigh the financial ramifications of overpricing which results in extended weeks or even months on market. How much will each additional month cost you? Be transparent about the condition of your home- I promise you it will matter. Be vigilant about changes in the market as they can happen quickly and without warning. Your realtor should be keeping you updated.

My advice? Don’t take market conditions personally. If you find yourself preoccupied with the way things were last year, or even a couple months ago, I guarantee you’ll be chasing the market down. Listen to your realtor, they see these things every day and believe me, the Real Estate environment can shift daily. Be aware and be shrewd and the market will be fair to you.