The weather is heating up and the market is………….settling down just a little. Folks this is a dynamic market. It’s a sellers market but how much of a sellers market changes with the wind. Advice to sellers now is different than March which was different than January.
Let’s start with the numbers. YTD inventory levels are improving, now down 18% from last year and 29% from 2 years ago (Recently it was as high as down 50% from 2 years ago!). Irrespective of inventory levels closed sales are flat, down just .3% YTD.
Now some discussions of the dynamics. Despite the limited inventory if your home is significantly overpriced sellers are not getting offers closer to market price. Why? Buyers figure sellers are looking at the same sales data and conclude there is no point in trying to negotiate with what appears to be an intractable seller. They tag it as a “favorite” and wait to see if the price comes down. You are typically better off to price it competitively, hire a rocking broker to market the home and endeavor to create a bidding war where folks do things like agree to inspections for information only or waive appraisals.
Speaking of appraisals I discussed appraisal issues in the last platinum club post and wanted to lay down some of your options as a seller if an appraisal comes in below your contract price.
1) Contest the appraisal with the lender (especially if you feel they have used bad comps).
2) Order a new appraisal (especially if you feel the original appraiser is stubborn)
3) Work with the buyer to seek out a new lender.
4) Negotiate on the difference between the contract and appraisal price (this is where your broker can really shine or really hurt you)
5) Agree to sell at the appraised value (if you feel it is fair)
6) Go back on the market (may not be such a bad thing if it doesn’t mess with your move out/up plans)
There is a lot going on in the market these days and these twists and turns highlight the need for elite broker representation. As always please reach out to me about anything even remotely real estate related. Talk to you soon!
It’s a good life.