We’re in a seller’s market, words that every homeowner wants to hear. But even a seller’s market needs to be handled with care and respected; it can turn on a dime on so many factors, quickly depleting your pot of gold.
A seller’s market is defined as a real estate market that has more demand than supply, and that’s certainly true all over Manatee County. As of January, there was only 3.4 month’s supply of single-family properties for sale in Manatee County – a six-month supply of available properties is generally considered a healthy real estate market. Also, to be considered a seller’s market, sales prices grow above 4% a year. As of January, single-family homes in Manatee County grew 6.6% over January of last year.
So, what’s the best way to sell your property in a seller’s market? It’s recommended that in a good seller’s market a property can be priced about 5% higher than comparable properties. But since we all know that a homeowner’s perception of a comparable property may not be what buyers see relative to condition and location, you must be careful in pricing above the market and treat it as an experiment that may not work and may need to be quickly adjusted.
Here in Manatee County, we are seeing a lot of new construction competing with resales. We’re living in a funny world where, unlike previous generations, buyers don’t want to take on projects and may pay a premium for new construction but not your home. Do whatever you can to remove objections to your property including some renovations that may not get you all your money back but could sell your property a lot faster. Emphasize features in your home that new construction may not ever have including water views and mature landscaping.
If you’re selling an empty property, consider staging or at the very least virtually staging which will provide photos online showing how the home looks with furniture. This may not beat new construction decorator models, but it will give you an edge with other resales.
Nationally and locally, sale prices are picking up as inventory stays tight. The S&P CoreLogic Case-Shiller National Home Price Index, which measures average home prices in major metropolitan areas across the nation, reported that for November there was a 3.5% increase over a 12-month period. The growth continues in their analysis in December with the average home prices going up 3.8% during the previous 12-month period.
The housing market has been expected to be boosted by mortgage rates being at their lowest level in half a century. However, although sale prices are going up, sales numbers are going down. Inventory is limited and buyers are not moving forward because they can’t find what they want and/or the price points are too high. According to the National Association of Realtors, the housing inventory level was the lowest for January since 1999. Existing home sales fell 1.3% in January compared with December according to the National Association of Realtors.
Until this market gets into a more normal area, we’re stuck with a seller’s market, not always a good thing. So, no matter how low the inventory goes, buyers aren’t fools and won’t pay way above market value just because they don’t have a lot to choose from. They’ll sit out the market, continue living with mom and dad or rent.
Don’t you be a fool and take the market for granted. Protect your pot of gold – it may not always be there.