Housing Market Slowing?
Is the housing market slowing? That’s the question I’m hearing the most these days and the short answer is yes. Slowing compared to what? Homes right now are taking ten days to sell instead of four days, which was typical in spring and early summer. Listings right now receive two to three offers instead of ten offers. Today there are 2,500 houses on the market compared to 1,500 a few months ago (for reference, a normal, stable housing market falls around 6,000-8,000 homes).
So, the slowing market is a matter
of perspective.
Here is what I see.
While spring was a sizzling market
for sellers, June, July and August saw a bit of a slowdown for some homes. There were fewer buyers in the market. This summer, unlike last, people had more
activities to do, vacations to take and places to go. Also, many buyers got turned off by the
competitive market in the spring and decided to put house hunting on hold. Unless buyers had to be in a home, in a
specific school district, by late August, many buyers took a breath.
This summer I actually wrote a few
“traditional” contracts where all of the elements like inspection period,
remedies, and seller paid warranties were like we saw years ago in a more
balanced market.
The homes that are still getting
multiple offers, with well above asking price, are the ones that have been
decked out, freshly updated and upgraded.
Buyers are still paying above asking price for homes with new paint, new
flooring, new lights and new kitchens. For
these houses, they are paying well above asking price, allowing sellers to stay
in the house after closing, and buying them “as is.” Interestingly in our area,
many buyers are now asking to purchase furniture from the sellers. Buyers and sellers
are making bills of sale separately for furniture, which benefits both parties
because sellers don’t have to pay for expensive moving, and buyers don’t have
to wait months for back-ordered new furniture.
The houses that are sitting are
the “tired houses.” Houses with brass fixtures,
overgrown landscaping, Formica countertops, and outdated flooring will still sell
but rarely get multiple offers.
As most of you know, even as a
30-year agent, I still actually go out and show houses, write offers, negotiate
and do what it takes to get a buyer into a home. Most agents with this much experience have a team
and usually buyers are assigned to a buyer’s agents. While I have a team, I still personally go
and show houses when they become available, on a moments notice. If you wait until the weekend, the good ones
will be gone..still.
Being an agent that works on both
sides of a home purchase, I have valuable insight that some agents, who only
work on listings, may not have. I list
homes that get multiple offers, and my job is to negotiate not only the best
price but also the best terms for my sellers.
When evaluating multiple offers, price is only one part of the
equation. My listing experience helps me
guide sellers in knowing who good agents are to work with, how to evaluate
different buyer’s lenders, and to know who does fair inspections. All of
these things must be looked at when we assess the quality of an offer. For example, I know that some agents will
offer a higher price knowing that the house will not appraise, hoping to
renegotiate after the fact. I also know
which lenders don’t always make it to closing on time. The experience I have being on the selling
side helps me guide my buyer clients when making offers because I know what
type of offers are being accepted.
Many sellers are living in the
spring frenzy and not being realistic about the current market. Today’s market
is still fantastic, but unless there is a ton of upgrades, the good market will
have to be good enough. As always, the
market will determine the correct price and in a tight market, this has never
been truer. If you have a place to go,
or you need a place to go, now is a good time to give me a call to start the
conversation.
