It may seem like an odd question to ask your real estate agent when you plan to sell your home and upgrade. You may be surprised, but Leah and I have been asked this multiple times during this strange and unexpected housing market. The past two years have been difficult for buyers. First-time homebuyers may find it hard to win an offer and not feel like they are giving away their life savings. When you decide it’s time to move and hear the rumors of how hard it is to buy, you may start to question, worry, and think, “maybe I’ll stay in my home.”
So why do sellers feel they will be homeless if they sell their homes? Well, let’s look at what we have personally seen as Real Estate agents working with our clients:
- Low inventory: Buyers are having a hard time because Sellers are deciding to wait (precisely what we are talking about here)
- Contingencies: As a Buyer and Seller simultaneously, you are having a hard time having your offer accepted because there has been no action on selling your property.
- Cash is King: We have seen many cash buyers during the pandemic and investors during this interest rate hike giving them an advantage in competing offers
- High sales price: Many houses are selling above asking, multiple offers, waived contingencies.
You list your home to sell and get multiple offers in the first couple of days. The problem is that you haven’t even found a house you like to purchase yet. You start to worry that once you accept an offer, you’ll have to rush and pick a home for yourself that you aren’t too sure you love. Even worse, you’ll sell your home and be back in your parent’s basement! You may feel like you won’t be able to win an offer if you find your dream home. It takes a heavy toll mentally and emotionally. As the seller, in a way, you have more leverage than a buyer, simply by stating in your agreement, “contingent on Seller finding suitable housing.” That, right there, is your safety net. With that phrase, every party knows we cannot move forward until you find the house that works for you!
For example, a client recently had a hiccup at the tail end of their transaction. A minor, easy fix could have delayed us another week in purchasing their new home. The problem was that they were scheduled to close their current home in two hours! Would they end up homeless? No. “Contingent on seller finding suitable housing” was the saving grace. Don’t get me wrong, it would have been very upsetting to all parties involved, but no one would be homeless. Thankfully, we have a fantastic team that cleared that issue in a snap and was able to close on time!
Cash is King:
Every agent will tell you we love a client that can purchase a home with cash. Cash is King. The past two years have seen a strong seller’s market and increased cash buyers. We have certainly felt the disappointment in losing to a cash buyer because – did we say this already? – Cash is King.
A few months before the interest rate spike, clients of SSRG put offers on over 15 properties in just a few short months. All the offers were above asking, with excellent terms, and yet did not win. Things are starting to change, however! The end of this year is not the same as how it started. Our past sales have seen offers accepted. Any homes sold above asking have come back with an appraisal supporting it with no need to use the “appraisal gap contingency.” Gone are the days of a home with 50-80 offers, but you may still experience a bidding war on a smaller scale.
People need to realize that we saw unprecedented high sale prices and historically low rates in the last two years. With the interest rates rising, we are seeing the real estate market finally stabilize.
High Sales Price
Sellers during the past two years could take advantage of making a large profit selling their homes. However, buyers had a hard time battling with the decision not to pay more than the home was worth or miss out on the perfect home. Especially with the words “Market Crash” looming in the media.
Our final thoughts: Everyone’s situation is unique. Find an agent who makes you feel comfortable and protected. One that communicates with you and makes sure you know every fact and detail of the sale and purchase of your home. We are in the market to find people’s homes, not make them homeless. If you think you are ready to sell or purchase a home, call Leah and me. We can go over the next steps or answer any questions you may have in detail over coffee!
Here are 9 insights from NAR’s 2022 Home Buyer and Seller Generational Trend report that we wanted to share with you:
- First-time buyers made up 34% of all home buyers, up from 31% last year
- 60% percent of buyers were married, 19% were single females, 9% were single males, and 9% were unmarried couples
- 31% percent of buyers had children under 18 living at home
- 11% of buyers purchased a multigenerational home to care for & spend time with aging parents
- Baby Boomers make up the largest share of sellers at 42%
- 7% of buyers financed their home purchase
- 45% of Younger Millennials (ages 23-31) reported having student loans with a median loan balance of $28,000
- Gen Xers (ages 42-56) were the most racially diverse buyers in 2021 — 23% identified as Hispanic, Black, or Asian/Pacific Islander
If you’ve been paying attention to the to the housing market, I’m sure you’ve heard people’s fears of being “in a bubble” again or fearing the market will crash. Here is how we are calming our client’s nerves.
Housing experts predict the market will remain strong for several reasons:
- Ample Home Buyers: With most first-time buyers under 40 and the U.S. population nearing 170 million, there’s no shortage of buyers
- Low Inventory: Too many buyers. Too few homes. Experts say it will take at least several years to inject enough supply to balance out the market.
- Healthier Mortgages: Unlike the 2008 housing crash, tougher lending standards and modern mortgage regulations mean today’s homeowners are less likely to default than those who were approved in the pre-crisis lending period.
Wondering what the housing market will do this summer?
Here’s what experts are predicting:
- Inventory: Inventory is likely to peak in late summer or early fall. About 64% of prospective home sellers plan to list their properties by the end of August.
- Interest Rates: All signs point to interest rates growing further in 2022, with the Fed planning hikes after each of its remaining 2022 meetings.
Don’t give up now, get paperwork ready, and stay positive.
Your home is out there, just waiting for you to discover it!
A common mistake people make is to spend a lot of money – renovations, new roof, remodeling. While buyers will be impressed with these things, spending $5000 on remodeling will not add $5000 to your sale. Spend as little money as possible, and spend it on cosmetic, readily seen features like interior painting. The time to remodel is when you plan to stay in the house, not when you’re going to sell.
If you think about everything that needs to be done to sell your house, you might throw your hands up in despair, or at least feel some anxiety. Take one step at a time, one small task at a time. Break it down to manageable-sized chores and you’ll have better results.
First things first – have a garage sale. Whatever doesn’t sell can be set out for Green Drop. Once the clutter is cleared away, it will be easier to see what needs to be done.
This is your first impression, so it had better be a good one.
Edge, mow and fertilize the lawn regularly. Make sure it’s well watered and reseed any sparse areas.
Trim hedges, weed lawns and flowerbeds, and prune trees regularly. Cut back overgrown shrubbery that looks scraggly or keeps light out of the house.
Buy a new welcome mat.
Check the foundation, steps, walkways, walls and patios for cracks and crumbling, and reseal if possible.
If you have siding or brick, power-wash it. If you have a painted exterior, consider repainting in a neutral shade. This is especially important if there is any peeling.
Make sure the porch light works.
Clean and align gutters and downspouts.
Inspect and clean the chimney.
If the doorbell doesn’t work, repair or replace it.
Repair and replace loose or damaged roof shingles.
Repair and repaint loose siding and caulking.
Remove oil stains from driveway and garage.
If you’re selling in the winter, keep walks neatly cleared of snow and ice. Otherwise, keep the walks and driveway swept.
Repair broken outdoor steps.
Spring for some brightly colored potted outdoor flower arrangements for the front yard near the entrance. It really helps the curb appeal!
Keep your garage door closed.
Wash the windows inside and out.
Store RVs, boats and extra vehicles (anything that can’t be parked in the garage) elsewhere while the house is on the market.
Paint the front door.
If prospective buyers walk into your house greeted by the smell of cat litter, cigarette smoke, mildew or pet accidents, there is little chance that even a reduced sales price will persuade them to buy. So the first thing to do:
Clean, clean, clean. This includes walls, floors, inside closets and cabinets – everything. Consider even hiring a cleaning service to come in and do the job.
Get rid of clutter. Put away appliances you normally leave on countertops. This alone will make your house appear bigger and brighter. Clean out your closets, garage, basement and attic.
Paint the walls and ceilings a neutral color – off white or beige.
Repair cracks, holes and damage to plaster, wallboard, wallpaper, paint, and tiles.
Replace broken or cracked windowpanes, moldings and other woodwork.
Repair dripping faucets and showerheads.
Buy new cabinet knobs and curtains for the kitchen.
Shampoo all carpets, scrub and wax linoleum, wash and wax wood floors.
Unclog slowly draining sinks and tubs.
Clean out the fireplace and lay some logs in it.
Mend torn screens. Clean out all window tracks.
Check to see that all windows will open and close.
Replace burned-out light bulbs. Use brighter light bulbs.
Make sure every light switch works.
Nail down any creaking boards or stair treads (drive two long finishing nails at opposing angles through the floor and sub-floor into the joist).
Oil any squeaking doors
Remove excess, worn or unattractive furniture.
Thoroughly clean all appliances (especially refrigerator and oven).
Replace old toilet seats and shower curtains.
Clear all cobwebs from corners and doorways.
Wash all light switches, handrails and doorknobs.
On Showing Days
Keep draperies and shades open to let in the light.
Place fresh flowers throughout the house.
Have your home well-lit during showing.
At night, turn on porch light and outdoor lighting in back if you have it.
Set out colorful, clean towels in the bathroom.
Avoid having dirty dishes in the sink or on counters.
Keep any toys in the children’s rooms, bikes, wagons and skateboards in the garage.
Play pleasant music at low volume.
Spend the day of an open house away from home.
Leave pets locked in a secure cage or remove them with you for showings.
Unless you’re selling it yourself, let the agent show your house, and don’t tag along.
This can all seem very overwhelming when you’re first getting started. Remember to tackle the job in small chunks for the best results!
It’s with incredible excitement that I announce
Smith and Smith Realty Group!
My husband Ben and I have created our team with Coldwell Banker Realty Moorestown and we are so excited to move forward in our real estate career, together.
We look forward to working with you!
Let’s meet Ben
Ben has joined his wife Leah at Coldwell Banker Realty to create Smith and Smith Realty Group. Before real estate, Ben was a Director of Rehab in sub acute facilities. Leading a team of rehab therapists through the pandemic, Ben knows his way around difficult situations, negotiations, and stress. A perfect mix for a career in real estate 😉
Ben lives in Merchantville with his family. He loves to play hockey and is a devout tortured Philadelphia sports fan. He shares his wife’s addiction to coffee and good food.
Reach out to Ben to start discussing your next steps in selling your home!