Selling in a transitional market requires special preparation and awareness of reality. The phrase, transitional market, refers to a period of time between a seller’s market and a buyer’s market. There are lots of posts that explain how to sell in a buyer’s or seller’s – but few that focus on what to expect and how to attract qualified buyers to your listing in a transitional market.
Identify the Direction of the Tansition and Respond Accordingly
Selling in a transitional market is not the same as in a sellers’ market so you need to be informed and prepared. Traditional markets aren’t just lulls. Rather, they are the bridge between a seller’s market and a buyer’s market, and you need to figure out which way the trends are moving so that you can respond accordingly. If today’s market is in fact shifting from a seller’s market to a buyer’s market, you need to prepare to be more competitive. Research the market and similar homes, price your home competitively and advertise aggressively. By preparing yourself to tackle competition head-on, you’re increasing your odds of getting a great outcome at closing. Even if the market is simply moving to a stable balanced market, don’t you want to be ahead of the transition?
The Sellers’ Market is Very Likely Over
Forget that seller’s market of last year. You know the market ….sellers often received several full-price offers quickly, and they could afford to be picky about what offers they accepted. Additionally, sellers could price their homes aggressively without worrying too much about scaring off prospective buyers. Conversely, during a buyer’s market, buyers may put in low offers on a home, and they may even end up haggling with the seller to get an even lower price.
In a transitional market, there tends to be less excitement on the part of buyers. As a result, you shouldn’t price your home too high as it may deter buyers. They will simply move on to more realistic sellers. In this market buyers are still reeling from the impact of the recent interest rate hikes that have so drastically changed their buying power so they are not lining up to over pay.
Price is Key in a Transitional Market
Selling in a transitional market requires that you get the price right. The price of the home is the driving factor that determines how quickly – or even if the home sells. While its tempting to price the home above the market value in your attempt to get the most money possible, it can be self defeating to do so. A home’s value is no secret. Any real estate agent can run a quick comparative market analysis and advise their buyers that a home is overpriced. These homes don’t get shown. They sit. They just languish and eventually the seller has to drop the price just to get any nibbles.
Cleanliness is Crucial
Nobody wants to look at a dirty house, let alone pay good money to live in it. Study after study has shown that homebuyers want a turn key home so that they can move in without having to clean up after the former owner.
If cleaning isn’t your thing, hire a company to come in and get your soon-to-be for sale home in shape. If you don’t, you risk having your home sit while your neighbor’s house gets all the attention. As the market shifts and listings take longer to sell, then it is important to have that cleaning crew go back in a month to make sure that your home is still in picture perfect shape.
Condition Is Key
It is always important to have your home in good condition in any market, but selling in a transitional market makes condition even more important. Sellers who put a home on the market without taking the time to fix it up are going to be on the market longer and sell for less. Go through the property and look at all the dings and nicks that you have been ignoring. Get a handiman in to fix all those items on your honey do list. Look at your MLS photos as a buyer would to see if there is anything distracting in the photos, such as an overgrown plant drooping over the corner cupboard or trashcans in the front yard. Use the listing photos to identify issues in your home that may discourage a buyer from marking it as a favorite on line.
If your home is not selling in the transitional market, then ask your agent to show you what is included in the marketing plan. Print marketing doesn’t bring a lot of buyers in these days (except for a few categories) but social media definitely does. Is your agent marketing your home on Facebook, Instagram, Pinterest and other locations? Are the pictures quality professional photos? Is there video available and floorplans? As we transition to a different market, it is reasonable to expect your realtor to actively market your home.
Be Realistic and Patient
Having just said that agents need to shift with this transitioning market to being more proactive, it is also important for sellers to shift their expectations too. As we come out of a red hot sellers’ market, homeowners are discovering that the price they expected to get is not attracting buyers. Homeowners are dropping their list prices and considering concessions such as closing cost help that they would not have imagined six months ago. Fortunately most sellers are in a position to be able to make those changes since they are sitting on significant equity gained over the last few years.
It would be wonderful to be able to time the market perfectly and to have sold at the peak of the market last year. Most of us do not have that ability.
A changing market does not prevent homes from selling. It may take a bit longer for them to sell than it did a few months ago. There is less opportunity to try out a price and hope that you get it. This is the time to ask yourself as a seller what is your motivation to sell. Chances are that the market in 2023 is not going to bounce back this year to last year’s activity levels. If you want to sell this year or next then you should position yourself to make that happen.