FOR SALE

If you have been looking to buy or sell real estate recently, then the term "Sellers’ Market" is one you have probably heard. What is A Sellers’ Market? It is real estate jargon for a climate that GENERALLY favors sellers. Such a market exists when the number of qualified buyers seeking homes GENERALLY exceeds the available inventory. In other words, it’s a case of Supply and Demand, with the demand of buyers out-pacing the supply of homes.

Factors such as a particularly desirable geographic location, or an ample supply of good jobs, may be responsible for creating localized Sellers’ Markets. However, wide-spread Sellers’ Markets are usually the products of low interest rates and good economic conditions. These factors tip the scales in favor of sellers, across the board. When attempting to bid on a house in a Seller’s Market, buyers sometimes vie with other purchasers for the same property. Because of increased competition, buyers realize they must be prepared to bid quickly, and with a good offer, once they find the house they want.

While at first glance, these conditions might appear to be perfect, GENERALLY, for anyone considering selling a home, this is not always SPECIFICALLY the case.

GENERALLY vs. SPECIFICALLY

The problem with a term like "Sellers’ Market" is this: while the expression was created to describe conditions that GENERALLY occur when certain factors are present, every seller immediately attributes the phrase SPECIFICALLY to his property, and his situation. This mindset can have unfortunate consequences for a homeowner.

Yes, a Sellers’ Market is a good time to offer a home for sale. However, it does NOT mean: Consumers will automatically line up, taking deli numbers, to buy any house. A seller will automatically get all his terms, as well as his asking price. The house will sell in a week, for full price. The condition of the house doesn’t matter.

While market conditions may favor sellers with increased opportunities, converting these opportunities into a viable sale is not a "given". The conversion requires a willingness to compromise. In addition, it requires realistic expectations, as well as an appreciation of the other guy (the buyer).

Telling It Like It Is

The most oft heard complaint from real estate professionals during a Sellers’ Market is that homeowners tend to be unrealistic about the worth of their properties. Actually, that description is tactful. What listing agents really say is that some sellers have absolute Delusions of Grandeur. Unfortunately, market conditions often feed a seller’s great expectations in the beginning. Here is a common sequence of events:

A property goes on the market, and immediately generates interest. A flurry of calls, and a number of showings, occur within the first week. Soon, there is an offer on the table. While the offer is neither full price, nor contains all the conditions the seller wants, it represents a good starting point. It is a viable offer with genuine possibilities. The listing agent is excited, and believes the offer can be negotiated, and a binding contract achieved. The sellers not only want to counter at full price, but also inform the agent they are thinking of raising the asking price! After all, they reason, with all the interest the property is attracting, they probably under-priced it !

Perhaps the single biggest mistake sellers make is in not seriously considering, and working with, the first offer they receive on their property. By failing to realize that their "newness" on the market is what attracted the flurry, and that the best offer is sometimes the first one, sellers do themselves a disservice.