How to address the Market FRENZY!!
I am sure you have heard by now, through the media or the experiences of your family and friends, or perhaps maybe you yourself have experienced it personally there is a lack of inventory in many local markets.
Ultimately these markets are considered a Sellers’ Market. A Sellers’ Market is considered less than 4 months of inventory available. Though as I see it there are starting to be some signs of within some local pockets a balanced market ahead. (Inventory levels between 4-8 months). But for the time being many of us are still sitting in these fast paced Sellers markets. In some extreme cases homes priced and marketed correctly are selling within days!
As a result of this frenzy we are seeing some of the following developments:
- 1)Offer Amounts Rise/Days on Market Drops – With the low inventory levels we are seeing homes selling quicker and values are increasing as the vast number of buyers is looking to get an edge. More and more cases in a lot of markets we are seeing home
- 2)Bidding Wars – The buying frenzy has been causing buyers and their agents to get aggressive in their offers. They are going above list prices and at times are adding escalation clauses that will continue to raise their offer price above any and all offers by a certain amount
- 3)Appraisals coming in short – Over the last year we have been seeing more and more appraisals come in under the purchase contract price. As a result this is either killing deals or simply bringing them back to the negotiation table.
- 4)“Nothing is available” – This seems to be the mind set not just of active buyers, but potential sellers. As a result they are staying out of the game. Therefor inventory levels are remaining low.
To be best prepared for this market, whether a buyer or seller, it is important to understand your options and the tactics to get you to your ultimate goal.
So, finally, you have found your home. Perhaps you visited the open house, you saw it very crowded, filled with potential buyers and their real estate agents. Maybe you have lost in a previous bidding war, maybe not, but you are sure you want to win this one! You want to make sure you can provide a strong offer from the start. In the recent past most multiple offers would result in the seller countering to all offers requesting “best and final.” In many cases in most local markets this is no longer the norm. I make sure my buyers know they need to go in strong from the beginning.
So how do we strengthen that offer? READ THE REST OF THIS BLOG AT LETOURNEAURE.COM
Written By: Mark Letourneau
Mark is a leading realtor working with Keller Williams Realty and Lead Agent on The Letourneau Real Estate Group. Mark has been working within real estate since 2007 and established The Letourneau Real Estate Group in 2012. For more information or questions please contact Mark at [email protected]