For a number of years we have been in a drought situation.  But not this year.  We have had so much rain I'm beginning to wonder if I live in Washington State or South Carolina.  Don't get me wrong, I love when it rains but in SC we are used to a large number of sunny days every year and all this rain is cutting into our SUNSHINE.  I'm really not complaining as we do need the rain , but does it always have to come all at once??  I have to go start on the ark - Good Night:)

It's hard to tell your buyer clients to curb their Holiday Spending, but if they wish to purchase a new home in 2010 they need to start curbing their spending in 2009.   With tighter credit requirements for mortgages, borderline clients may need to really control spending.  On average it takes 7 months to pay off credit cards used for Christmas spending.  Obviously, this debt will impact credit scores and the Debt-to-Income ratio.

Granted, it's hard to do; but you should advise your buyer clients to be cautious and control spending that might hurt their mortgage possibilities and the purchase of their new home.

Negotiating Real Estate Transactions in today’s market can be time consuming and difficult. Many buyers believe they can steal a home by offering 20% to 30% under market value. Yes there are bargains out there. Foreclosures and Short Sales are opportunities to buy below market value and even some New Construction Homes that have been on the market for a year or more. As a listing agent you must keep your client informed on changes in the market as well as changes in the mortgage industry that could have an impact on both price and absorption rate. Don’t forget it’s the “bird-in-the-hand” issue and if the opportunity is a real one you must try to keep negotiations moving forward.

As the buyer’s agent you too must be up to date on the current market, but also get your client back on solid ground. Making your first offer to “test the waters” may be O.K. But when the counter offer is realistic, based on market conditions, your client must decide if they really want to purchase this home or are they just wasting your time. If they are not motivated to pay a fair price for this home, take them to others in the same price range. If they find something else, great. If not they should come back. Lastly, it’s not about you! It’s not your home or your money! Get rid of the attitude and keep friendly and open communications with the other realtor in the transaction. If it’s not a win-win situation for all, move on.

It's hard to go into a listing presentation and tell your potential clients that the price they believe they can get for their home is unrealistic in today's market.  You get your clients to agree to a little lower price but they are still chasing the market, not ahead of the market.  Before you know it your listing agreement is about to expire and you have not sold the home.  Now What?

Setting realistic expectations up front will help you when you advise your clients to lower the price, paint the interior or exterior, manicure the landscape or whatever else the home may need.  In our area in today's market we use an 8-8 rule.  The rule is very simple, if after 8 weeks or 8 showings (whichever comes first) if there have been no offers you will need to "Reposition the home". 

If you set the expectations during the listing appointment it will make it much easier to use updated market statistics, including absorption rates and a CMA, to position the home ahead of the market.   Also have all of the feedback from showings to get your sellers to make necessary improvements to get the home sold during the contract listing timeframe.

A quick note:  The 8-8 rule may not apply when listings have absorption rates of 9 months or more.  You may need to do some research in your area and modify the rule for your  particular market.