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Since January 2011, standard sales have increased from 29% of our active market to 41% and sales have climbed from 25% to 38% of sold homes in Southwest California. While about 2/3 of these continue to be flipped properties, good old-fashioned ‘normal’ sales make up a growing percentage. That’s a good sign for the market. But those ‘normal’ sellers aren’t finding as many ‘normal’ buyers as they might like. At least not at first blush.
The market’s changed – I hope that’s not a news flash for you. Most areas are having half price sales on houses, three-for-one condos. Buyers who should be taking advantage of these deals are either
A) unable to because they have no equity in their current home, or
B) able but too uncertain about the future to act.
A) first-time homebuyers who are thrilled to have their own roof over their heads and don’t care if prices climb or drop a little in the short run, or
B) Investors taking advantage of this perfect storm of low priced inventory and record low interest.
Both groups are used to making offers on short sales or bank REO’s, so they don’t customarily start with their best offer first and never the asking price. This is coming as quite a shock to some ‘normal’ sellers as lowball offers not just 3%-5% low are coming in, but offers 15% - 20% below their asking price. And they’re often shocked and insulted.
As you have every right to be - for a couple minutes. Then you need to put your personal feeling aside and put on your business panties. Your first tendency will just be to frag them and not even counter-offer. WRONG. Once your agent talks you through that little crisis, your second emotion says – counter at full asking price, we’ll show them. Wrong, too.
Why? Because it’s an offer in hand and that’s key to getting your home sold. No offers = no sales. (That’s profound – you have my permission to use that phrase). And you never know if or when the next one might come along. They’re not insulting you personally, they’re just playing the game by the current rules of engagement (Statistically, one or two might be insulting you personally, but it’s just not worth worrying about). Buyers know there’s going to be a premium paid for the convenience of a well maintained live-in home and if they love it they’re going to buy it. Eventually.
With this next move, you’ll sift the wheat from the chaff, as it were, the bottom-feeders from the buyers. If you back off a little from your asking price (which may have been a little high to begin with, if we’re being honest), you’ll show them you’re serious but approachable. The cads, the bounders and the bargain hunters will know not to waste their/your time but the ‘normal’ buyer who just may be in love with your home, will come to the dance.
You may have to exchange offers several times before coming to a mutually satisfactory agreement because you share a common goal, which is to wring every last nickel out of that house. And there’s more riding on the ‘win’ these days. When times are good people will happily overpay a little just because they’ll quickly make up the difference. Ehhh… not so much today.
In closing, I encourage you to keep this positive thought in mind. As soon as your place sells and you’re ready to buy your next dream home – you’re going to be in the buyer’s seat. And I’m guessing you’ll be just as scandalous and rapacious as the worst buyer you ever faced. Your lips whisper no, no, but your eyes ….
Of course that’s just my opinion – I could be wrong.
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.