As homeowners, you are undoubtedly aware of the market, watching prices carefully and analyzing what is happening on a regular basis. You may be wondering where your own house fits into this tapestry of headlines, estimates, and the proliferation of local realtors “Just Sold” postcards.
The market is very up and down right now. If you are selling a beautiful 3-bedroom, 2-bath home or larger, with a decent yard, in a great neighborhood, so long as the floor plan is good, and you are not too high in the hills and have demonstrated that you can still get insurance without paying an arm and a leg, you will likely have a successful sale. That is, if your home looks like something out of House Beautiful or Architectural Digest. There is always that one house that is getting 15 offers, even now.
But for those of us with houses that are not perfect, we need to have patience and exhibit flair in order to get buyers to come.
Right now, with the real estate uncertainty in the news, and the interest rates staying high, there is not a lot of incentive to get buyers to buy anything, let alone your non-view house high up in the hills. You have to figure out a way to incentivize them to purchase.
One way is to offer to pay points to buy down the interest rate on their loan. Another is to offer to carry a second note.
Make sure you have sourced house insurance for the disclosure packet. Make sure you cover point-of-sale repairs like sewer laterals. Get an automatic gas shut-off valve if you don’t already have one. Upgrade your electrical if it is a knob and tube. Fix your roof if it needs it. Or at least provide bids as to what it will cost. Insurers are rejecting houses with knobs and tubes or any major system problems. Common sense ideas like these will play out well for you in the long run, whether you sell now or later.
On the commission side of things, I know all of you are reading that come July commissions become negotiable. The reality is that commissions have always been negotiable, and nothing is really changing except that the buyer’s agent will need to have a signed buyer/broker agreement that says the buyer will pay their agent in the event that the seller is offering a lower commission, or no commission. When buyer agents are compensated by proceeds of the sale directed by the sellers, those sales attract professional buyer agents and incentivize buyers to offer more for those homes in my experience.
One of the key benefits of the changes coming in July is that buyers and buyer agents are having clear, transparent conversations about compensation, and the roles and responsibilities of both the buyer’s agent and the buyer. Making the buyer understand this is a formal relationship, akin to the documents signed for a listing, it raises the bar for the entire profession.
There will always be complicated issues that come up in real estate. Remember 2007? We just went through an unprecedented increase in values for the past 12 years, and typically real estate runs in 10 year cycles. It is not realistic to think that the housing market will keep growing and growing every year by 4-6 percent. That is completely unsustainable.
Looking at the good that can come out of these issues that arise always takes our industry, and the standards we uphold, to a new professional level. As always, the best agents in this industry will be able to pivot and elevate their service. Agents who can’t will leave the business.
Please call or write to me with any questions or concerns!
