“Best” Time for the “Worst”

Written by Posted On Tuesday, 18 May 2021 00:00

While many real estate markets continue to burn hot, this is a great time for sellers of special, unusual, or unique properties to jump in and cash out.

• Sellers who “paid too much” for their real estate in the last boom or who ended up with a budget-breaking construction or renovation project that priced their home out of pre-boom markets.

• Sellers who did not apply the “location, location, location” value mantra and bought on a “lesser” street, a less popular neighborhood, or in a less-urban community where properties typically appreciate in value more slowly.

• Sellers who do not want to invest the time and thousands it would take to modernize their home. This includes those who bought a home they loved except for the necessary reno to solve the too small kitchen/missing ensuite/lack of playroom, but then never did that reno and won’t do it now.

• Sellers who don’t live near the best schools or popular amenities and who’s property value was usually penalized for this.

• Sellers who live on busy streets or on the edge of commercial areas.

• Sellers who have a second home or recreational property they can move to if they can’t find exactly what they want to buy or rent next because prices in their preferred buying or rental area are already too high.

• Sellers who have concerns about climate change and how it may devalue their property. Those with waterfront or flood-prone properties may want to relocate while their real estate holds its enhanced value.

• Sellers who face other necessary or painful reasons why they must move now even if they don’t really want to.

Sellers in preferred locations and with modernized homes can jump into the real estate market whenever they choose because theirs are the properties buyers most favor. Homeowners with properties that need TLC or which are not located where selective buyers choose to live may find achieving their desired selling price is a challenge in typical markets.

When there’s a shortage of listings, buyers with limited time or specific goals to achieve and who must buy now will search further afield and may be prepared to compromise on location or other property features. They must choose from what’s available.

In Covid times, many potential sellers are holding back from listing because they want to see how their job situation resolves itself, they want more choice shopping for their next home, or because of a wide range of personal reasons. When listings are low in many areas, buyers who can’t wait are forced to broaden their search and compromise on their “must haves.”

Sellers should not see this hot-market opportunity as a time to take advantage of buyers. Real estate professionals will ensure the property is properly presented. The edge here for owners of typically-less-preferred properties lies in buyer eagerness taking the spotlight off imperfections or lesser features. The focus here is on buyers intent on satisfying their immediate need for a home—move-in-ready or ready-for-renovation.

These properties may not always sell for significantly over-asking, but they could bring better prices than in less demanding markets or in buyers’ choice markets—and more quickly.

The cautions for these sellers are similar to those for any homeowner who jumps into a hot market:

1. What’s Next?

First make sure you can afford the housing you’d like to move to next. Often, when sellers can get more for their homes, the real estate they would like to buy or rent will have gone up in price too.

2. Mortgage Fit

Mortgage lenders do not provide buyers with a mortgage based on sale price. Lenders provide financing based on the appraised value of the real estate, which is typically a price that represents a sale in a less frantic market. Real estate professionals are aware of the potential gap between a multiple-offer sale price and the appraised value and will bring this to their seller’s or client’s attention during the transaction.     

3. Reasonable Expectations

Pay attention to the sales information provided by the real estate professional who will list the home for sale. Comparisons with previous sales should be with very similar properties. Consider carefully and from a target buyer’s perspective what the marketable list price should be. Listing under market value to attract a bidding war works when the home makes an emotional connection with buyers. This “must have” buyer reaction usually involves at least a cosmetic do-over or clever staging, both of which may cost the seller if these services are not included in the listing fee.

4. Driven to Succeed

Interview real estate professionals to find the right fit. In the unique situation of an atypical home, this usually involves the professional being genuinely enthusiastic about the sales potential of the property and about how to market it to the “BEST” advantage.

For more on making a confident decision to sell, read PJ Wade’s RT articles:

1. Five Key Questions For Home Sellers

2. Five Questions for a Fresh Seller Perspective

3. Are Sellers Crazy Not to Sell Now?

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PJ Wade —       Decisions & Communities

Futurist and Achievement Strategist PJ WADE is “The Catalyst”—intent on Challenging The Best to Become Even Better. A dynamic problem solver and author of 8 books and more than 2800 published articles, PJ concentrates on the knowledge, insight, communication prowess, and special decision-making skills essential for professionals and their clients who are determined to thrive in the 21st-Century vortex of change.

PJ Wade's latest business bookWhat's Your Point? Cut The Crap, Hit The Mark & Stick!—further proves PJ's forward-thinking expertise and her on-point ability to explain technical, even non-verbal, communication details in practical, actionable terms. Print publication: Fall 2022.

PJ: “What's Your Point?the pivotal 21st-Century business question—must be answered before you open your mouth, hit a key, tap anything or swipe. Too often 'Your Point' is not clear to you and communication remains an expensive illusion.”

As The Catalyst, PJ concentrates on enhancing communication ROI for experienced advisors, executives, entrepreneurs, business owners, and other savvy professionals, who may not have received as much formal training in communication as they have in their own field.

Onward & Upward—The directions that really matter! Reach PJ at pjwade@TheCatalyst.com and visit her What's Your Point? Blog. Keep up-to-date with PJ's popular column  Decisions & Communities

https://www.thecatalyst.com

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