Go ahead and Google “Is it a good time to buy a house 2017.” I got 62 million hits.
Now go ahead and Google “Is it a good time to sell a house 2017.” I got 24 million hits.
Interesting, right? People are 3 times more likely to want to buy a house than they are to sell one. This suggests a little supply and demand problem.
Why are there 3 times more articles and blog posts about buying a home versus selling one?
I know one reason. It’s a heck of a lot easier to buy a home than it is to sell one. Another thing: if you’re trying to give advice on either side of the equation, it’s a lot easier to deliver the right message for the buy side. So whether it’s agents or people writing about this world, like me, buying advice is the easier advice to give.
Here is what the sellers are up against:
- Sellers, in many cases, may still be working against all the debt that we collectively racked up in the race to 2007’s bubble.
- Sellers, in all cases, want to show a profit on their real estate, and many folks might still be short.
- Sellers, in many cases, are left with no down payment after payment of commissions and other expenses.
- Sellers, in many cases, are the ones who bear appraisal risk (and this is a significant issue).
- Sellers, in many cases, have to deal with the wildcard of timing—how can I get this done quickly so my plan falls into place?
Each of the above is a fair concern to have. But they shouldn’t be deterrents to selling, especially today as the house market continues to get its legs back.
If you are toying around with the idea of selling, things are looking good.
For one thing, if there are so many people interested in buying houses—several times more, according to Google—then that could prove to be an advantage in getting people to your open house.
Take a look at inventory, especially if you’re in what we might call a stronger market. It’s down right now, meaning you’ve got quite a bit of leverage.
Basically, a lot of the noise and hype that drove us to the bubble has washed away and the market continues to approach the pre-bubble trend line. The path from 1990-2003 with a couple tweaks here and there for economic factors puts us on a strong value path.
Maybe that’s still a little too much jargon. Put another way, we’re in a pretty normal market.
Here is what’s happening:
If you have a good property in a mature neighborhood that perhaps is feeling the effects of a lack of inventory, you’re likely in a very good position. You can be a little aggressive in your pricing. But pay attention to the most recent comparables. Use the higher comps in your market and/or the pending properties as the best pricing guide.
If that same quality property is in a neighborhood where there’s a decent supply in balance with demand, then ask your Realtor to help you understand the absorption rate, or how long on average it’s taking for a property to go into contract. This should help you understand your timing. If you’re in a good school district, you should follow the trends for the number of days on the market and ask/sold ratios. Really important to get a good grip on comparables.
If your property comes with some vulnerabilities or if there’s a lot of supply in the area, be conservative in your pricing. Know that you need to price it attractively for it to stand out.
Above all, make sure you’re working with someone who knows the market well so you get the best possible advice.
Of course, we would be happy to help…