Two weeks ago we explored whether you’re in a Buyer’s or Seller’s Market when it comes to real estate, what it really means, and if it even matters. I’ll link to that video here, in case you missed it. It may help to put things into perspective for this video.
This week I’m taking a more focused approach and sharing tips for selling your house when you’re in a seller’s market, and tips for selling your house when you’re in a buyer’s market.
Your approach to selling your home can and SHOULD change depending on the current state of the market, so let’s talk about what you can do.
If this is your first time here, welcome! If you’ve been here before, thank you so much for spending your time with me. My name is Lindsay and I‘m a proud Anthem resident and your local REALTOR® with the Wise Move AZ Team at Realty ONE Group. On our YouTube channel and blog we have a lot of fun talking about all things Anthem and real estate every single Thursday, and we absolutely love having you along for the ride.
Timing the Market…
As I discussed in our previous video, I don’t know that there is a lot of value in the average consumer trying to time the market. It’s really about making the most of the current market and playing to the strength of your position in it.
So, my plan is to start with my tips for selling your home in a buyer’s market, because that’s usually the more common question we get, but after that I am going to jump straight into my tips for selling in a seller’s market. Although it may be less asked about, I feel strongly that it’s equally important.
Tips for Selling in a Buyer’s Market
As a quick reminder, a Buyer’s market is a market that tends to favor buyers. Prices may be decreasing, homes may be taking longer to sell, there may be more homes on the market, and so on. Generally, there are fewer buyers in the market for your home… Ouch!
Tip #1: Price your Home Well
It’s so important to price your home well, right out of the chute. This is typically not the time or place to start high and hope that someone will make an offer and you can just ‘meet in the middle’. Many buyer’s don’t want to waste their time making an offer that won’t go anywhere. They also don’t want to risk offending you or they just don’t want to work with a seller who has unrealistic expectations. Either way, pricing your home too high can be a serious ‘turn off’ to potential buyers.
Work with your agent to carefully review the comps and set a reasonable price. You may find articles online or other videos that encourage you to under price your home when you hit the market to spark competition. This can be a successful strategy but only in certain markets. It depends on the demand in your area and the nature of the buyers. It can be a risky approach that requires some serious forethought and conversations with your agent.
Tip #2: Make it Sparkle
You want your home to stand out against the competition in all the right ways. The good news is, this doesn’t have to cost a fortune, either. Consider doing the following:
- Declutter: If the Buyers can’t see past your stuff, it’s going to be tricky for them to visualize themselves there. Make your home as open and inviting as possible.
- Deep Clean: Top to bottom, inside and out! Clean right before it’s listed and then keep on top of it, if you happen to be on the market for a while.
- Up your Curb Appeal: Buyers may pass by your home if it looks drab on the outside. In a couple of weeks we will be releasing a video solely on increasing your curb appeal, so subscribe to our YouTube Channel and hit the bell icon below if you would like to be notified when that’s released.
- Make Obvious Repairs: You really don’t want buyer’s to be come in and focus on deferred maintenance. Hire a handyman for a couple of hours and take care of the obvious things.
We address these points and SO MUCH MORE in our video on getting your home ready to list in 30 days or less, so I will like to that here, in case you would like to check it out.
Tip #3: Consider Professional Staging
According to the National Association of REALTORS®:
“One quarter of buyer’s agents said that staging a home increased the dollar value offered between one and five percent, compared to other similar homes on the market that are not staged”
Now, do I think that ALL homes need to be staged before they hit the market? No, but I definitely think it’s something worth exploring when you’re in a strong buyer’s market.
You could consider hiring an agent that offers staging services. Most importantly though, you need to know your competition. Look at similar homes currently on the market. Do they look staged? How does your home and interior décor stack up? Be honest with yourself, and if you can’t be honest with yourself bring in a friend that can be (we all have at least one).
Tip #4: Show it Off
Getting your home ready to sell and listing it is a lot of work. You’ve got my full sympathy. Now that you’ve put in all this work, it’s time to show it off. In a buyer’s market you want to make your home as easy as possible to show. Homes that have limited showing times or other restrictions may get crossed off the list right away. Remember, in a buyer’s market there are usually lots of options.
In addition to making it easy to show you want the showing experience to be a pleasant one. When possible turn on the lights, open blinds, turn on water features, and so on. You may also want to consider playing light music, and offering a small snack and water. The goal is to have potential buyers falling in love and spending time in your home.
Tip #5: Get Creative with your Counter Offers
It’s possible that you will receive a ‘low-ball’ offer in a buyer’s market. Don’t get disheartened. You certainly don’t have to respond, but before you toss it away I encourage you to consider your options. With any offer, I recommend that you have your agent draw up a net sheet, so that you have a good idea of what you will walk away with. While your counter may address the purchase price, it could also provide ways to sweeten the pot for the buyers in ways that don’t directly impact your bottom line.
If you are going to counter an offer I encourage you to learn as much about the buyers as you can.
Would a particular closing date work better for them?
Are their items of personal property that they are interested in, that you could include at a higher price?
Could you offer a carpet allowance?
You want to try and find a win-win, knowing that you’ll probably have to give a little to keep the buyer from moving on to the next house.
Selling in a Seller’s Market
Alright, so that was the hard part, but what if you’re lucky enough to be selling in a seller’s market. Life’s good right?! You can just stick and sign in the yard and those buyers will be climbing over each other to buy your house, right?!
Ehhh, not quite! You may have a leg up, but there are definitely some things to consider.
As a quick reminder, a Seller’s market is a market that tends to favor sellers. Prices may be increasing, homes may be selling quicker, there may be fewer homes on the market, and you may be seeing more multiple offer situations.
Tip #1: Create a Buzz
If possible you want your home to hit the market with a bang and go under contract quickly! The less time you have to put up with showings and negotiations, the better, right? Usually we recommend listing on a Thursday night or Friday morning so that you’re at the top of the feed when buyers are planning their tours for the weekend. Your agent may even recommend hosting an open house if that makes sense in your market.
You may want to consider getting out of town for the weekend or staying with friends so that you don’t have to put up with the traffic and you can get as many showings as possible in. Often the best offers come early in the process, so make it easy to show in the early days and let the offers flow!
Tip #2: Price it Right
Just because it’s a Seller’s market doesn’t mean that buyers will pay any amount for your home. Buyers are smart and they’ll see right through your greed if you price your home way too high to start. A well-priced home can spark competition among buyers, generate interest, and lead to multiple offers.
Work with your agent to price the home intentionally and appropriately right from the start.
Tip #3: Review Offers Carefully
Being a Seller in a Seller’s market is exciting! Buyer’s want your home and in some cases they’re competing for it. It’s quite possible that you will find yourself in a multiple offer situation, congratulations! You might be tempted to just sign off on the one with the highest price and pop the champagne, but hold on! I hate to be a buzz kill, but popping the champagne will feel so much better when you have carefully and thoughtfully reviewed the offers against what you really want.
Have your agent draft up a net sheet for each of the offers, so that you know how much you can pocket from each. Once you’ve reviewed that, I want you to think about the other aspects of the contract that don’t impact the bottom line.
Does the closing date work for you?
Are they asking for items of personal property you don’t want to part with?
Alternatively, would it be helpful if they gave you the ability to leave items of personal property behind?
Would it help if you could rent the property back from the Buyer after closing for a couple of months?
Don’t be afraid to ask the buyers if they would be willing to accommodate these requests.
Additionally, you want to make sure that the buyer is capable of closing the deal. Are they paying cash? Did they include proof of funds? If they are getting a loan, consider having your agent talk to the lender about their situation and getting confirmation that they can move forward. Is their offer contingent on the sale of their existing home? We did a whole video addressing whether or not sellers should accept contingent offers. If you would like to check that out, I will link to it in the cards for this video.
Tip #4: Be Careful about Calling for ‘Highest and Best’
Sometimes in a multiple offer situation you hear of Sellers putting out a call for ‘Highest and Best’. This means that if you’ve already submitted an offer, you are encouraged to submit your best offer.
I personally don’t like this approach as it can really turn off buyers. Many sophisticated buyers see this as a way to make them negotiate against themselves and they aren’t willing to participate.
If you find yourself in a multiple offer situation and you want to counter, I strongly encourage you to use the Multiple Counter Offer form. This is designed specifically for this situation and it allows you to tailor your counter to each offer. It’s a little more work but I personally feel that it’s worth the effort. You don’t have to counter every offer and it keeps everything on the up and up.
Tip #5: Act Quickly
You might be thinking, ‘wait a second, I thought as a Seller in a Seller’s market I was in a position of power. Why do I need to rush?’ The problem for buyers in a seller’s market is that it can be a bit frantic for them. They may need to put out several offers at the same time just to snag a house, depending on how competitive it is. If you drag your feet responding to offers, those buyers may have gone under contract with another seller already. I don’t want you to rush, but I do want you to approach all negotiations with a sense of urgency and importance.
So, there you have it! What do you think? Are you ready to sell with confidence regardless of the status of the market?
Also, in the interest of making sure that you are totally ready to list your home you’re going to want to click here to watch our video on getting your home ready to sell in 30 days or less, or click here to watch a video where we fully explain the difference between a buyer’s and seller’s market and whether it even matters.
Enjoy those and I’ll see YOU next Thursday!