Most of us follow the ups and downs of real estate over time, largely because of our own vested interests, but also because we view the market for homes as a gauge of how the economy is performing in general. If we are not buying or selling today, we all expect to be in the market sometime in the future because of a wide range of life-changing events and other reasons.
We experienced (some more critically than others) how problems with real estate financing and investments can explode into serious depression-like symptoms in our nation’s economy.Today, however, we are many years past the worst of the mortgage melt-down, interest rates remain at all-time lows, and there are significant numbers of potential buyers anxious to own a home. In many parts of the U.S., the market for homes has largely recovered. Yet, in significant portions of the country the real estate market remains relatively anemic with low inventories, disappointing price rises, and longer selling times, known in the business as “days on the market”.
Depending on who you talk to or what you read, there are several theories for the condition of the current real estate market.Below are some of those theories:
–Lasting effects from the mortgage crisis that affected attitudes and confidence in real estate in addition to growing financial conservatism
–While qualification criteria for mortgages have eased somewhat since the housing crisis, it remains difficult for many low income and first-time buyers to qualify.
–The U.S. economy shows promising signs of strength but remains sluggish
–Uncertainty surrounding the upcoming presidential election
–Limited inventory. If owners aren’t selling, there are fewer homes for purchase
–Lower wage increases
–Corporations holding on to cash reserves thus limiting support available to spur the economy
–Large increases in outstanding student loans, affecting the ability of millennials (a high potential source of home buyers) to afford homes
There are some positive signs that may help the growth of real estate in the future:
–Interest rates remain low. Even if rates rise somewhat in response to Fed monetary policy, rates should remain relatively low.
–New home construction is on the rise
–Despite industry ups and downs, home ownership remains a goal for most families
–Even in slow markets, homes will sell if prepared and staged correctly and are priced to sell.
The bottom line is that real estate remains likely to improve in terms of the number of sales and selling prices, although the rate of climb may not be what we would like.
So, what can we do as homeowners to help our homes sell quickly and for a good price when we are ready to move?
- Start the process early.Making repairs and updating the décor can often take weeks or months.
- Partner with a real estate agent that you are comfortable with and can trust.There are many pitfalls and your agent is your best ally.
- De-clutter your home by removing excess furniture, photos or other family items.Rent a storage unit if you simply can’t part with all of it.Doing so will make your home appear more spacious and neat.
- Selectively update your home’s features to reflect what buyers are looking for in today’s homes.Hire a decorator to help if you can.
- Make sure you have professional photographs taken for your listing.Since most home searches are conducted online, if the photos don’t capture the attention of potential buyers in the first few seconds, it’s on to the next one.Professional photos are one of the biggest “bang for your buck” in real estate.
- Most importantly, use the resources of your agent to set the selling price.It is tempting to ask for a higher amount thinking it will give you more room to negotiate or hoping that a family will love your home enough to pay your higher price.That is always possible, but the odds are much better in your favor to set the price at the market level.The way buyers search for homes today is frequently online by specifying a price range.If you set your price too high, you could miss a good buyer even though you might be willing to sell at the high point of their range.