Is It a Good Time to Sell My Home? (v2)
Lately, as I talk with families about marketing
their home, one of their major questions seems to concern timing. In other words, they want to know: “Should we place our home on the market right now, or should we wait until Spring?”
Let’s recognize up front that I have a vested interest in their placing it on the market now. If they market the home today, then we sell it sooner and I get paid now, rather than later. Either way, I only get paid for selling their home in a difficult market, so having acknowledged that point, let’s set it aside.
I believe now is a good time to sell your home--or at least start the process. First, if you are considering selling in the Spring, now is the time to talk with me regarding which repairs should take precedence, what upgrades give you the best return on investment, and what needs to be done before listing. Go ahead and get started on those items now, so there won’t be such a rush in the Spring. If you are serious about selling, then now is better than later, in my opinion. Consider the following arguments with regard to entering the market now.
- You will be able to list it for more now rather than later. The market value of a home is what the market is willing to pay for it, plain and simple. Determining the market value involves looking at the previous 6 months comparable sales figures for the homes in the area similar to the property being sold. Right now, we are able to use the comparable figures for the past six months--this includes the height of the selling season. We are about to enter 2 down quarters of business revenues, negative news cycles, and continued stock market uncertainty. In the Spring, the comparable sales figures will most likely be lower than they are now. Yes, that means I expect sales prices to decline this Winter. However, discounting $260,000 is much better than discounting $250,000. Go ahead and take advantage of the higher starting point available today.
- Everyone else is waiting until Spring. I believe in being contrary to the prevailing herd mentality. This past week was a great time to buy stocks, simply because so many were being sold. If you market your home now, while inventory is low, you have a better chance of getting a higher price for it. Believe me, buyers know it is their market right now and when they make an offer, they often make one that is so low it can be offensive--and they expect sellers to meet them in the middle. If that is the case now, imagine until after the next 2 quarters of negative news passes.
- Sales figures (number sold) in the month of December are often as high as at the end of Summer. Over the next couple of months, the best minds in the advertising business are going to attempt to get people to spend money. Like it or not, the Christmas season is a time when people make buying decisions quickly. Take advantage of that. Additionally, people like to close over the Christmas break.
- If you decide to place your home on the market now and it is on the market a protracted period of time, then you can adjust pricing during the Spring. Redoubling your efforts in the Spring and making a price reduction then are more likely to see results than if you go into the market in the Spring, then have to redouble/reduce next Fall. At then end of 6 months on the market with no sale, you will be more encouraged to take a proactive stance in the bright days of Spring than if you are looking down the road to Winter.
- I conduct 2, sometimes 3 open houses each weekend and buyer traffic is great. As a matter of fact, the people I have met at open houses recently are serious about purchasing their next home--much more serious than the buyer traffic I witnessed in the late Summer.
- President-Elect Obama will take office in January. The news media will do everything in their power to make this transitional period appear positive. History shows that during the past 4 recessionary periods, when a new party took over the administration, then the economy recovered. Ideology and policy don’t seem to matter to the markets--what matters is predictability.
- Interest rates are going up and the Fed meets again soon. Every time the Fed has reduced the discount rate, there has been a corresponding increase in mortgage rates. That trend will continue. Additionally, we will see even higher interest rates in the Spring, due to increased inflationary pressures resulting from all the liquidity being forced into the markets recently.
So yes, I am confident that for a host of logical reasons, it is the best time to begin marketing your home.