If you have lived in Bryan-College Station for very long, you know that we have a booming market, not only in Real Estate, but as a whole. Recently, we have seen a decline in many industries, and though stronger than most every City in America, we too are starting to feel the decline. With interest rates back at the “all time lows” and all of these new tax advantages, how could we have any economy problems?
Values are holding steady, however, we have seen a large decline in the amount of qualified buyers. What this means for you if you are selling your home is that you are going to have to be the “BEST” to be the one sold! A Buyer’s market is when buyers are able to choose from many homes they love and get the lowest price on them because there are fewer buyers and more homes for sale. Where before if you found a house you loved, you should jump on it before it was gone at full price, now if you find it, many Real Estate Buyer’s Agents are urging their clients to make multiple low offers if they like more than one house and go with the one who gives them the best terms and price. This has actually happened on two of my listings recently. Buyers and their agents know that if they want a good deal, now is the time to get it. Prices are still high and not going down, but that isn’t too far in the future as far as we can tell. However, because the inventory is so great and the number of buyers are down, sellers MUST negotiate and give that good deal if they want to be the “winner!”
In the past years, buyers were able to get 100% financing, even with fair to mid credit scores. Now even with a above average credit score, you need 3%-5% down payment. And let’s not even talk about Small Business Owners who must have near perfect credit AND 10% down to even talk about getting Stated Income Loans, which used to be a self employed buyers best friend! In addition, buyers must have money for closing costs. A $100,000 home would require a buyer to come up with approx. $7500 for closing costs and down payment. That is about 8 times what their monthly payment will be! To set your home apart from others like yours, offer closing cost help or down payment assistance. There are many third party companies out there that will grant a buyer money, and then it is paid back by the seller. This is completely legal and simple, and almost necessary in so many cases for a buyer to be able to afford the money it takes now to get into a home. These programs, like Nehemiah and Genesis, enable the buyer to get into the home without their own funds, but the seller is having to include the money in the price. So if you are giving a buyer 6% back for down payment and closing costs and you sell the house for $100,000, then you are really selling for $94,000 before your own closing costs, fees, taxes and payoff. Many times you can put the price at the highest it can go and roll this in, as most buyers are willing to pay the top of the price range for a home if they are rolling in all of the money they need to buy. They know that without the sellers help, they would not be able to buy a home. So it is good to consider this when pricing your home, in case a buyer comes to you needing to roll in all of their expenses for closing. Many sellers have chosen not to do this. But keep in mind, just because a buyer does not have thousands in the bank to put down does not mean they don’t deserve to buy your home! If they need help with getting the financing and the bottom line puts you where you need to be, then everyone’s goal is met! A closed home for all!
Because so many buyers were able to buy with no money down the market was booming and we had a long never ending line of buyers waiting to buy YOUR homes! Now the buyers we have that can actually get approved for a loan without sellers help, have so much choice in this new “Buyers Market” that if you are not the best priced, best negotiator (make sure you have the right Realtor for this) and best looking home then you will take longer to sell. Most of the time it is best to take the offers you get and try to work them instead of getting upset at the lower price offered and turning it away. What you will save in selling now versus later will many times make up the difference!
Bottom line is that now that the tables are turned and there are more homes for sale than there are buyers, you must take action if you want to be the home sold. Remember, be the best looking, best priced and have the best Real Estate Agent working for you so that they can successfully guide you, negotiate for you and know the tools to market your home for a quicker, higher priced sale. Don’t be the one the buyers skip over! Make the right choices now when listing your home, and I look foward to seeing you at the closing table!