A Fall Real Estate Market Update
Last week, I compared the typical spring and fall housing markets in the western suburbs. This was mostly from the perspective of sellers. That is, when is the best time to market your home? When are buyers looking — or more importantly — buying?
For most of the summer, I have been making the case to sellers in my market that the fall has typically been a good time to market a home. Last year’s fall market had fewer listings than the following spring market, but the sales prices, ratios to asking prices, and market times were all virtually the same (I am omitting $1.2 million+ high-end sales, as those have been down almost everywhere). It is early in the 2011 fall market, but so far, anecdotally speaking, we are seeing more cautious buyers than we saw in the spring.
We have a median-priced Lexington listing, for example, that came on last week. We had showing appointments from the very minute the listing came on. We welcomed a few of the same buyers who came for each of the three days through the weekend. We hosted two busy open houses and continuous broker showings. Multiple brokers asked what our plan was for offer protocol. We told all interested parties that, as there seemed to be imminent offer activity, we would present any and all offers to the sellers on Monday evening. We had three offers that seemed certain. But the buyers all either got cold feet, looked elsewhere, or just held back for the moment. The brokers told me that they all feared a bidding situation and/or looked in other towns. We have little doubt that the well-priced, stylish house in a great neighborhood will sell for a price that the seller wishes, but who, in this 2011 economy, expects a house to have a bidding situation?
Well, we do. This phenomenon had ebbed from 2005-10 for the most part, but in 2011, my biz partner and I had at least five listings that went the first week, many with multiple bids. We are spoiled. The buyers who are looking this month are taking it a little easier. I can attest that this is the case with my own buyer clients. I am feeding them tons of data to help them determine value. In a few cases, we are looking at different towns and even condos versus detached single-family homes. But oftentimes buyers are also sellers and have to make careful decisions about shifting equity and synchronizing purchase dates, sale dates, and closings.
Money is cheap right now, with rates at historic lows. But buyers are still cautious, not wanting to be the ones who overpaid. Yet focusing on small percentages of a listing price often is losing the forest for the trees, with price increments offset by potentially rising interest rates (they might not go anywhere soon) or missing out on homes that go to another buyer willing to step up. Don’t get me wrong, when working as a buyer’s agent, I have nothing to gain from trying to convince a buyer to make the leap for a particular home. When I am a buyer’s agent, I am not in a hurry. I like to be a consultant, working with folks for as long as it takes for them to find the right house at the right price. But when I am a seller’s agent, we want our sellers to get a relatively quick sale for a price they feel good about.
It still is early, but the fall market is a short one. Let’s see how the story unfolds.