We could talk the party line. You know how spring is traditionally the busy time in real estate. Corporate moves are on the rise and buyers are anxious to take advantage of lower priced properties and lower interest rates. But… of course.. that would not be our way! If you are currently selling your home or thinking about buying one, there are some real truths to this market.
First, let me address the general market trends. Everyone asks “Are prices still going down? Maybe I should wait to put my property on the market. What do you think?”
We think that if you want to sell, put your property on the market. The market trends are almost daily rather than monthly. One week we think we have bottomed out and prices look like they are going to stabilize and then the next week, they start to drop again. The financial institutions have hinted that they have a lot of foreclosed property that they will be putting on the market in or around June. Again, because of supply and demand, prices might drop slightly.
If you are going to have to put your property on the market as a short sale, and have been keeping up with the headlines, you may think that your home will qualify for a quick response short sale. In many cases, that will not be correct. The amount of red tape is amazing. Just remember that in order to qualify for this new program, the seller must have applied for and been rejected for a loan modification. I addition, there is a very low limit on the amount that a second can receive on a short sale. The lender will be receiving money from the Gvt. to accept a short sale however in many cases; they are determining that it is not worth it for them. And as you can tell with the very low numbers of loans that have been modified with the Gvt. new guidelines from the nightly news, you can see that there is very little chance that they will work with the sellers on this either.
In addition to all of this challenging news comes the Fed which stated that they will be holding rates for another few months but not until the end of the year and all targets point to a possible rate increase in the summer or 4th quarter.
So again, is this a good time to put your property on the market? Again, we say yes! It doesn’t look like the pricing will go much higher in several years and throughout that time, you will be competing with financially challenged properties.
A seller, therefore has to figure the carrying costs, such as maintenance, taxes, and insurance, and that total adds up quickly while keeping the property off the market. We have had several sellers who rejected market driven offers with hopes of getting an offer of higher price, and in doing so, they have spent much more than the difference in the amount offered than if they took the original offer.
Now that there has been a decision to put the property on the market, there are a few things we need to stress. (Picture me on my knees for a second please.) Please listen to your Realtor when he goes over the current market activity and what properties are selling for. Remember that every seller, including those owned by financers, think that their property is something special. They all have added those little touches. Most have already done upgrades and to a buyer, the fact that your raised your children in the house doesn’t mean anything. Buyers read certain headlines just as sellers read selective headlines.
Buyers are looking at the bottom priced group of homes in a general area. They are offering whatever they want and are hoping the a seller will take it. Sellers need to understand that this is going to happen and not get upset over it. It is a major part of today’s game. Now it the time when the good Realtors go into action. It is the time when our training in negotiation is beneficial. Negotiation does not mean that a seller gets what they want or a buyer gets what they want, it means that there is a lot of discussion goes on before a deal is either made or not. Don’t give up hope so soon. But, both buyers and sellers must be coming from a reasonable stance.
One of the other challenging points that I must bring up is that of the appraisal. We have been talking for a while that it is to the benefit of the seller to get an appraisal done on the house before it is put on the market. That $400 (est.) will be well spent to get a fair and honest price for the house. A little bit about current appraisals. Appraisers are given instructions to only go back 90 for their comparative sales so that in a depressed market, those are the only comparatives that are realistic as to what the current market value should be. Given the fact that so many are short sales and REOs, the appraiser has to take those into consideration. A lending institution doesn’t care why a property sold for what it did just that should they have to take the property back, what would they get for it. And in a depressed market, there would be even be an automatic reduction in value due to estimated trends for the next 180 days.
This is making it really difficult for any market to stabilize or even start to grow if they are told to devalue a property by a certain amount. Even cash sellers are getting appraisals, which are really adding an additional challenge to getting the market to stabilize or increase.
One more word to sellers: make sure that the property is uncluttered, looks good and is kept clean. We have been talking about the details for the past year but they are more important now than ever. With all of the choices that buyers have, you have the need and opportunity to make yours the best looking.
There are lots of buyers out there. A correctly priced property and a good Realtor, like one from D&J Realtor’s group, will help a qualified buyer find the right property. Here in the State of Florida, the assumed relationship between a buyer or seller and their customer is what is call a Transaction Broker. They work for the transaction making sure that all parties are dealt with honestly and fairly. There are other specifics but a discussion with your Realtor will clarify their responsibilities. We bring this up because there needs to be an understanding on the role of a Realtor. They are not parties to the contract. Their job is to help but a qualified buyer and willing seller together so that a smooth transaction will happen. Their job is not to help a buyer ‘steal a property’ nor is it to hide any defects in the property so that the buyer is not aware of what they are buying. Their job is like a counselor for the both the buyer and the seller. A counselor on pricing, neighborhoods, market trends, styles of property and negotiating. D&J Realtors are part of the Gold Jacket history of professionalism and quality service. Customers select us because of reputation and our international connections. We encourage our buyers and sellers to have honest discussions with us and take serious consideration to the information we provide.
Selling your home in any market doesn’t have to be an overwhelming experience. You can count us to make sure everything goes smoothly, whether you’re looking to relocate, move up to your next home or even downsize—we have the answers you need.
