July 24th, 2011 → 7:07 pm @ jaybowman
Here in Louisville, Kentucky I hear the same question over and over:
How’s the market?
It’s understandable. Everyone wants to know when to stop being afraid. When will it be ok to return to normal again? I don’t think a lot of people realize it won’t be the old normal again. We, and the rest of the world, are facing a new normal. More restricted banking laws, years to recover home equity lost, and devastation of people’s credit are just to name a few issues that the real estate community now is facing.
We expected the market to be better this spring than it was. We were hopeful. As of this post we have listed 37 properties through our flat fee MLS model. We sold or placed under contract 10 of those 37 listings and are currently in negotiations for number 11. We felt that people were going to be tired of being afraid and be more bold than they were; then the numbers didn’t get better, the middle east blew up and the sovereign debts of nations became the focal point of Europe and the US.
So how’s the market?
After a lot of discussion within 60 Day Realty and talking with other agents we’ve come to a conclusion concerning the market.
It’s not that buyers don’t believe that seller’s homes aren’t worth the reduced price that they’re asking; it’s that buyers don’t want to have anything to do with this market at all. They’re gonna sit it out until they feel safe again.
Fear has taken over.
What if the value drops another 10% after I buy it?
What if I lose my job?
What if something happens and I need that down payment for something else?
While all legitimate concerns I prefer the following mindset:
Audaces fortuna iuvat
Fortune favors the bold. Are you buying your house for a short term investment or for a long term home? Do you have a 6 month cushion of financial reserves prior to buying a home in case of a job loss? Won’t there always be possibly something catastrophic around the corner that you could use the money for?
Buyers will not in their lifetime find a better time to buy homes. Period. A lot of sellers tell me, “Get me the most you can, but in the end I just want out.” Buyers can find fantastic homes for great prices. Doesn’t matter if you’re looking at $50k or $500k homes, this is a perfect time to buy. Be reasonable, but be ready to pull the trigger.
So how’s the market?
The market is poor for sellers because some of them are taking a beating. The good news is if you have the best house at the best price in the best location your going to sell. Price too high and you’ll sit. Think too much of your homes condition: sit. Trying to get top dollar for a house on the railroad tracks? Answer: sit. Price your house according to its location, condition and market circumstances: a successful sale is in your future. Buyers are still there, you just have to fight for them.
The market is great for buyers. They have numerous hoops to jump through for lenders, but in the end they have the pick of the litter when it comes to home.
So how’s the market?
Audaces fortuna iuvat.
Sellers: Do the repairs you need and don’t expect a buyer to just let it slide. Think about that landscaping that you’ve avoided for the last few years. Still have brass door knobs on the doors and cabinets? Avoid fast food for a few weeks and spend the saved cash on a few minor updates. The internet is full of ideas on updating interior and exterior.
Buyers: Stop being afraid. The fear of buying is the blood of the vicious cycle our market is in. Be cautious, but determined. That seller that is willing to sell cheap today won’t be so cheap when you feel better about the market. That interest rate that looks so good will not be around when the markets return.
This isn’t the end of the world. The economy is bad but it won’t be this way forever. Opportunity is out there, take advantage when it presents itself. And remember, in the end, fortune favors the bold.
Jay Bowman, Broker/Owner
60 Day Realty
Louisville, KY
60 Day Realty is Louisville, KY’s premier flat fee MLS brokerage. They list homes for 60 days for a flat fee. It’s Selling Made Simple! Visit them at http://www.60dayrealty.com