“I don’t need to sell”…”I’ll just hold it and wait for the market to improve”…”These aren't comparable”. In a very few short months, home sellers have their swagger back. While many are exploiting favorable market conditions, many others are repeating the sins of the past – ignoring the data. Oddly, the really overconfident sellers tend to be those that have had expired listings; never mind that the home failed to sell at $X, with the rebounding market it’ll now sell at $X+15%. We saw this challenge coming last fall; we hoped we would be wrong. Many of the highly desirable Atlanta metro areas are experiencing a shortage of quality listings. Homes accurately priced, well presented and well situated are selling; and they’re selling quickly for very high sale to list ratios.
There are many reasons for this market surge – most are not attributing it to the economy but rather to a combination of things:
- Low rates that bumped and kick started buyers
- A shortage of quality inventory
- Return of boomerang buyers – those that lost homes early in the crash
- Regular seasonal cycles
- Institutional investors influencing the market
- Rising rents making buying more attractive
- Significantly increased use of FHA and FNMA Homepath mortgages
However, despite conversation about loosening the lending environment for buyers, mortgage underwriting and appraisals continue to be an obstacle. Some
estimates have about 50% of Atlanta homeowners “underwater”, while they might like to sell they are unable as they cannot cover the gap between likely purchase price and what they owe. Some sellers however, well they just chose not to consider the current data. Over the last few weeks, we have had the opportunity to meet with several owners of homes that were previously listed but failed to sell. All were sound, in areas that are experiencing increased activity and all have appealing features that will attract attention. In every situation, the seller was walked through the process that a buyer’s agent AND appraiser will use; a road map for success was laid out. No listings were taken; but some very interesting statements were made.
“I just put 30K into the house; I have to get it out”. Words of another previously listed owner as he waved his hands over the data. This was listed 15% higher than it expired at and a good 25% over the community.
“The power lines have never been an issue”. Said by the owner as we walked the yard in the rain and the arcing on the wires sounded like corn popping. Dismiss the clear, recent data demonstrating a good 20% negative value influence, never mind public perception. Just keep hoping to find that 1 in a 100 buyer that's OK with the wires.
The market has shifted to sellers; that is clear. However, buyers are well educated and lenders remain cautious; the Wild West days of the real estate boom are not being repeated. Sellers that fail to understand they will find themselves sitting in homes that become stigmatized with buyers asking “what’s wrong with that house that it’s been on the market for so long?” When questions like that start being asked, nothing good happens.
Selling a home is not rocket science; price it accurately, make certain it’s appealing, present and expose it well to both buyers and agents and actually sell it – follow up and be attentive. The market ultimately determines the market value of a home, nothing else.
Associate Broker & Certified Appraiser
Atlanta Communities
www.hmtatlanta.com
678-428-2876
