Buyer’s Market. What a Seller Needs To Know.

The prospect of selling your home can be scary, even in a good market. Selling usually is inconvenient, stressful, frustrating and humbling. The more prepared you are, the less overwhelming the selling process will be. The first thing you need as a seller is education. If you are selling because of a job transfer or because you are buying another home for a growing family, then you probably don't have the luxury of waiting for the ideal time to put your home on the market.

Home prices are falling here is Sierra Vista, Arizona and in most of the country.  Inventories of both new and existing construction are increasing and there is more supply than demand. It has become clear that some sellers are slow to adjust.  Many sellers are not willing to drop prices by $5,000, $10,000 or even $25,000 to bring the price in line with what the market currently demands. It takes discipline to face that reality. Break through your ego and stubbornness by looking at the market conditions in your area.

First let's discuss the difference between a Buyer's Market and a Seller's Market. The short answer is supply versus demand.

Buyers' Market

A buyers' market is a market that favors home buyers because more homes are listed than can be expected sell in the near future. If, for example, 20 homes are listed in a neighborhood, and 5 were sold in the last month, the neighborhood has a 4-month supply of homes for sale.

 Sellers' Market

The market changes based on general economic conditions such as rising or falling interest rates, or the local business climate such as a new company opening nearby. If, for example, all 20 homes listed plus 5 new listings sell within a few months, then the market has become a sellers' market, where buyer demand meets or exceeds the house-for-sale supply.

Many sellers only remember what it was like when they bought the house a few year's earlier when it was a Seller's market. They remember when they had to bid up by 5 or 10 percent and had to put down a lot of money.  Many can't fathom the fact that now the Buyers will get to come in and bid 5 to 10 percent below their asking price.

 Here are some strategies that will work in a market that is becoming competitive from the Seller's perspective:

Adjust the Price

Simple, and it works. Buyer's don't care how much you paid for the house five years ago, or how much work you put into the place.  If it's overpriced, they'll buy someone else's home. If your home isn't moving, check the price first.

Let's Make a Deal

 If you are committed to your price, then sell the deal instead of the house. Make buyers an offer they can't refuse.

 "Move in and make no payments for three months."   Plenty of Buyers would love to move into your house and live "free" for three months. The catch is - your offer is only good on a full price contract.  Instead of just dropping the price, sellers could offer other incentives, such as a free washer and dryer, vacations and home warranties, and some are even offering vehicles.

Some loan programs allow the Seller to pay off Buyer's bills. The biggest key in all of this is to not wait for a Buyer to show up and then offer it.  Make the offer early and often to attract the Buyers.  In essence, you're not selling the house as much as you're selling the deal.  In a Buyer's market, the question is not if the Buyer can find a house, but which house offers the best value for the money.

Get your Home in Tip-Top Condition.  

Prepping your home for showings involves more than eliminating clutter, cleaning every room, and lighting candles. Nobody likes to spend money on a house they are trying to sell but taking care of cosmetics that might detract from your home's appeal and fix all obviously needed repairs should be a priority.  Touch up the interior and exterior paint if needed.  Clean or replace carpet.  Maximize curb appeal with attractive and well-kept landscaping. 

Hire a Great Real Estate Agent.   

You have made the decision to sell your home, now your goal should be to hire a great agent. While you might be temped to start with the yellow pages, the best way to find a reliable real estate agent is by word of mouth. Start asking for referrals, and pretty soon you'll have a fistful of cards for Real Estate agents you can interview.

Once you have your potential real estate agents, make a list of questions that you feel will benefit your specific needs. List traits you are looking for in a neighborhood, and ask for specific suggestions. If the agent you spoke to first does not sound like a good fit, simply move on to the next real estate agent. The more questions you have, the more information you will have in finding the perfect real estate agent.

Have a great day!!