Dipping temperatures mean dipping housing inventory but as we go through the cooler months, sellers can expect to attract more attention from prospective buyers.
Buyers in this market are generally more serious about making a purchase and with less inventory available, are less choosy as well. Add in continued low interest rates and you could expect a positive selling experience.
Some pointers for staying even more competitive
Know Your Next Move
Be a more confident seller knowing that you and your family have a plan just waiting to be activated.
Are your prepared to compete as a buyer in a seller’s market? Will you rent first or buy immediately? Are your personal financials ready as a buyer? Do you have a mortgage strategy? Will you be using the same real estate professional or an additional agent to facilitate your purchase?
If you are planning to sell then buy within the same geographic area and seller’s market conditions, you need a “next move” plan in order to soar.
Expect Buyers to be Fierce
A seller’s market makes buyers more competitive as well.
If they are paying top dollar, buyers will want to act fast and have been known to be relentless in their pursuit. They expect you to be responsive and communicative.
In some hot markets, sellers report that buyers have sent them letters, even videos on why their offer should be accepted. Make sure you have a strong agent who can effectively manage and negotiate the offer process.
Remember Homes Do Not Sell Themselves
Success requires preparation and a team
While there is indeed a demand for homes, the selling process can still be complex and often emotional.
Don't be distracted by the success or failure of "the house down the street." There are many variables in the process and some may not apply to you and your home. Get hour house in order and assemble a great professional team: agent, attorney, potentially a CPA -- and you'll be set for success.
Location: neighborhood desirability, school quality, access to highways, hospitals etc.
Specifications: lot size, square footage, number of bedrooms, bathrooms
Amenities: features such as a pool or a garage, etc
Condition: age, general wear and tear, renovations, improvements etc.
Financials: such as property taxes, association fees
Every home owner and potential seller wants the answer to the question “What is my home worth?" The Comparative Market Analysis – or CMA – is a critical pricing tool that your real estate professional utilizes in developing a pricing and marketing strategy for your home. The CMA is a fact-driven assessment of your home built upon the following data points:
Also important to the CMA are comparable recent home sales in your area.
Also known as “comps,” this data is critical to helping understand what buyers expect to pay for similar homes
in your local market.
The CMA is a valuable tool, but only a tool. Real estate agents must bring their know-how and experience in evaluating CMA information for your home.
Selling strategies also account for the type of market, (seller’s vs buyer's) and the home owner’s tolerance for time on market etc.
With information readily available on the internet, many sellers believe they can assess their home’s worth. Sellers should ask potential listing agents what additional insight and tools they can bring to the table.
Note: A CMA is not an appraisal.
An appraisal is a bank’s view of the property value used to help determine mortgage loans. Banks traditionally are somewhat more conservative when evaluating property value. A bank assessed value that is significantly less than the negotiated property price will make obtaining a mortgage challenging. Having a professional by your side can help you through this issue.
A well priced property will generate the most interest and potentially the most offers. It is counter intuitive to think that pricing is important if there are more buyers than inventory. Pricing a home competitively – and understanding what that truly means for your home – is key even in a seller's market.
A low ball pricing strategy is an approach that some sellers and agents use to generate foot traffic and interest in the property.
The hope is that a bidding war ensues and organically drives
the property up quickly. In some vigorous, well populated markets this could be a a solid approach. But it relies squarely on a large and motivated audience of buyers.
Requiring that buyers be pre-approved may help manage buyer volume.
Some home sellers will want to test the waters with a higher than average market price. This strategy has the potential to keep a house on the market for a longer time.
Time on market is not just a slower sale. It is also a marketing consideration that gives buyers pause to ask “why” and assume there is a condition or other issue present.
A longer time on market may also signal to buyers that they can make low ball offers on properties that have languished on the market for an extended period of time.
Note: Even if a buyer agrees to a higher than market price,
there still may be risk
An offer is more than just the asking price; it is the ability of the buyer to gain a mortgage quickly. Banks will approve loans to comparable market assessments and high prices may make it difficult for buyers to obtain mortgages. Accepting offers only from pre-qualified buyers with manageable contingencies is a solid approach.