Jim Valentine on Real Estate
As interest rates moved up a couple of months ago, we kept getting asked what was going to happen in the market. While we keep a crystal ball on our desk, it rarely shows us more than a magnified view of what it is sitting on.
Now that we are down the road a bit, market trends are emerging. Most seem to be a reaction to hype and speculation, but buyers and sellers can and should still control their own destiny.
Some sellers have panicked and dropped their price substantially. Interestingly enough, they are sold for the most part. That simply proves that at the right price anything will sell. The local MLS, including Reno, Sparks, Carson City, Dayton, Carson Valley, etc., had the largest number of price reductions in the nation with 32.6 percent of the listed homes reducing their price. It isn’t as drastic as 2009, but it illustrates what group thinking can do.
The market inventory is growing as is to be expected when the average days on market increases. We’ve gone from an inventory of less than a month to a roughly six-month inventory. You will want to affirm the inventory status of the specific property type and location if you are evaluating a move in the market. A six-month inventory has traditionally been considered to be a neutral market, not a buyers or sellers’ market, but even. A longer time on the market isn’t a bad thing, in fact it is quite normal. The frenzy of the last 18-plus months has been very much an anomaly. Getting to normal is actually good so you can buy and sell at a normal pace with normal safety clauses and activities i.e., inspections, repair credits, etc.
Without knowing where the market is going, we see a lot of sellers wondering if they should sell now before it goes lower. Buyers ponder the future wondering if the prices will go substantially lower. It can cause some to be frozen from action while they watch things develop. The problem with this position is that when the market does adjust the many others doing the same thing will act at the same time, and you won’t necessarily be able to achieve your objective. What to do?
If you find a house that you want to buy, make an offer that suits your wants, needs, and worry factor. Yes, we can do that again, make an offer lower than asking price. It doesn’t mean that it will be accepted, but at least the seller will know of your interest and can make a decision themselves as to what they will sell for in today’s market with their own wants, needs and worry factors. You’ll never know if your offer can help a seller along in their life if you don’t make it. Put it in writing so they have all the terms of the offer with which to judge the merits of the offer. You might just be surprised at their response.
Sellers looking to move up or down in this market are swirling in a confused sea right now. Can you sell high and buy low? How long until the market drops sufficiently for your ego gratification, or can you achieve your wants and needs now and get on with your life? This is a good time to act as many people are watching the action wondering what to do. Identify your wants and needs, get with your agent, and execute your plan.
Buying and selling a home is a big investment and can be a very emotional experience. Make sure you are comfortable with what you want, and you can buy or sell in any market so as to keep your life off pause. One thing you can count on, the market will change. Where will you be when the change happens? Happy in or out of your home, or frustrated with the process as you encounter market competition when the market dynamics come in to focus for the casual observer? The active agents, buyers and sellers are always looking for market nuances that will help them make good choices.
Pay attention to reality, not the spin that you read, watch, and hear about. Your ideal transaction could be just a signature away. Sign the contract!
When it comes to choosing professionals to assist you with your Real Estate needs… Experience is Priceless! Jim Valentine, RE/MAX Realty Affiliates, BS.3481, 775-781-3704. email@example.com