Here are six factors to watch in today’s shifting real estate market.
As you’ve likely heard by now, the real estate market is shifting. Compared to what we saw over the last couple of years, it’s a whole new ballgame. Today I’ll share the six topics you need to pay attention to if you want to keep up with our ever-evolving conditions:
1. List price. If you’re selling your home, pay attention to your list price. Home prices have begun to flatten out over the last 60 to 120 days. When you’re coming up with your list price, make sure your agent isn’t just looking at sold data but also pendings and actives. As the market continues to shift and inventory grows, it’s more important than ever to price your home competitively.
2. Sales price. The days of homeowners selling for hundreds of thousands of dollars over list price are behind us. Expect your sales price to be more in line with your list price than it would have been six months to a year ago. If you price your home in line with the market, you’re more likely to see multiple strong offers.
3. Days on market. Where homes once sold in just 24 hours (or quicker), they may now take several days. But don’t worry—if your home takes a week or two to sell, that doesn’t mean there’s anything wrong with it. Interest rates have gone up, which shrank the buying pool. That has had the effect of cooling down activity. Be sure to communicate with your agent about your area’s activity and market trends.
4. Terms of the offer. The terms of the offers you’re liable to receive will likely change, so be ready. Buyers once were willing to waive inspection and appraisal contingencies, but since the market has cooled, you may begin to see offers that include those contingencies. However, that’s not a bad thing—those contingencies protect the buyer. This shows a sort of equalization of the playing field between buyers and sellers, which means that we’re in a healthy market.
5. Financing. If you’re planning to buy a home, you need to pay attention to the numbers. As rates continue to fluctuate, be mindful of your buying power and communicate with your lender about what options you have. For example, adjustable-rate mortgages are very popular right now since their initial rates are lower than the standard 30-year mortgage. If you’re selling, be advised that you won’t see as many cash offers as you might have in the past.
6. Condition. Last year, sellers didn’t have to worry as much about the condition of their homes; the competition was so heated that many buyers were willing to purchase homes as is. Now that the market has calmed down, however, buyers have more license to be selective regarding a home’s condition. Spending a little time, money, and effort sprucing up your property will help it sell quickly and for top dollar. Work with your agent to ensure that your home is in top sales condition.
Whether you’re planning to buy or sell a home, if you have any questions or need assistance, give us a call or send us an email. We’d love to help you.