Here’s what we know… the market is in the midst of a transition and we’re seeing more inventory week over week and fewer competing offers on homes. For the last 18 months or so, we’ve often seen inventory levels teetering at 1-2 weeks, which makes for an uber-competitive seller’s market resulting in rapid appreciation and buyer fatigue.
As we transition, we’ll see a less competitive seller’s market into a stable, or balanced, market where we see houses sell for closer to list price, and often below list price, depending on how well the agent has priced and marketed the home.
In addition, there is some seasonality to consider. Mother’s Day weekend 2021 marked a significant shift in the market last year. We expected that to be the turning point back into a more civilized seller’s market and then eventually into a stable market.
Fast forward a few months into the late fall/early winter and we were back in a hyper-competitive market once again with homes going 10%, 20%, 40+% OVER list price.
Was there going to be any end in sight?
Well, factor in that plus inflation / potential recession, rising interest rates, a volatile stock market, rising cost of homes over the past 2 years, property Taxes and we’re starting to see some relief for buyers, and a shift in mindset and strategy for sellers.
We still have a shortage in housing supply in general that’s going to take years to come back to where we should be. The last 24 months were the result of over a 14-year period of underbuilding. Covid just exacerbated the problem because companies went remote and employees were able to live wherever they chose AND so many companies have moved into TX.
We also have 90 million millennials hitting their 40s and many of these people are getting into the housing market.
So what does this mean for you?
- Be Patient! Pricing your home is one of the most important decisions you’ll make in the entire process. Make sure you do it right and then be willing to wait it out. If you’re wanting/needing to sell in a weekend or two, price accordingly and understand that you may not wind up in a bidding war.
- Position your home in the best light. If you want to get top dollar these days, it’s still possible, but you need to showcase it properly. You may need to consider painting and/or changing out carpet, fixtures, etc. It should be professionally staged. The few $1000 dollars in staging costs will come back in terms of time on the market and price!
- Think creatively. I’ve been through several market cycles as an agent, investor and homeowner and it’s time to start thinking creatively to get ahead of the market. There are a number of things you can do to make a difference in the quality and quantity of offers you receive.
- Invest in marketing. I’m afraid the days of having your agent slap the property on the MLS with mediocre pictures and boring descriptions are quickly coming to an end. From creative open houses (We recently had Kona Ice at an open house) to top notch online marketing, it’s critical that your home is being PROPERLY marketed.
- Don’t rush it. I know when you decide to list, you want to do it ASAP, but be sure to build in enough time for professional photos, print collateral to be created and mailed, and so on. It really does make a difference in the long run!
LASTLY, don’t stress out! While the market is shifting, it’s still a strong market.
It’s still a seller’s market. It’s just not a market where people are going wild!
You’ll probably have fewer offers come in. There may not be a bidding war. And you may have to make some concessions along the way! The key is to think creatively and strategically from the beginning.
It helps to have someone in your pocket who has weathered a variety of real estate cycles and understands how to navigate a changing market… and who has expertise with marketing with new media.
REMEMBER: The last time we were in a market cycle to which we are headed now, most agents weren’t using social media, video, or online marketing at all. There’s a different strategy for positioning your home as well as marketing your home to maximize the exposure (and price).
