Reaching motivated sellers can be difficult when the market is in flux. With Cole’s powerful lead lists, we help you find people who are ready to sell.
In an ever-changing economy, trying to reassure your clients and predict what’s happening in the housing market can make you feel like a psychic without a crystal ball. Even if you had a crystal ball, knowing the temperature of the local market is more critical now than ever as we all navigate these difficult market fluctuations. Where are people buying and why? Why are people selling and giving up record-low interest rates? With the housing market changing literally daily, it can be hard to reassure sellers and find the most up-to-date information on the hot and cool national housing markets. Let’s dive in and gain some insight into what is really going on in the real estate market right now.
Is it a seller’s market or a buyer’s market?
With unprecedentedly high-interest rates cooling down home sales, it’s a difficult time for sellers, yet home values remain steady in most major markets in spite of a steep three-month peak-to-trough decline of 2.6% in the early fall of 2022.
With a housing market landscape unseen since 2009, it’s a grim outlook for both buyers and sellers as many sellers make desperate pricing decisions hoping to motivate a sale and buyers try to be strategic about timing their home purchase around an unpredictable economy (again, that crystal ball would really come in handy).
Buyers and sellers have never been so out of sync and with inventory also at an all-time low, choices are limited as some 51% of homeowners had interest rates below 4% just earlier in the year and plan to stay put, hoping to ride out inflation.
Offers are slow to come in, even with a lower-than-average inventory. Gone are the days of bidding wars and homes selling for more than asking. Yet, it’s still, technically a seller’s market, even with homes sitting on the market for much longer than in previous years.
Where is the housing market still growing?
Though the nation is seeing a severe slowdown in most markets, the Mountain West, specifically Salt Lake City and Boise continue the trend of being attractive and growing housing markets for multiple reasons. With a lower cost of living, unlimited outdoor beauty, recreational activities, and a housing market that is still affordable, these areas attract remote workers and people working in the abundant tech scene in nearby Utah County.
The Salt Lake Metro area saw a 15% increase in sales YoY as more people trade the inflated housing market of Silicon Valley for the powder-covered Silicon Slopes of the Salt Lake Valley’s up-and-coming tech scene.
We know what’s attracting buyers in these areas but what is motivating sellers to sell?
Top reasons sellers are selling
What motivates someone to sell is relative to the seller and their unique life stage. For most, the reasons are financial or location-based. With the prevalence of remote work, more people are moving to areas they want to live, rather than areas they have to live. This can mean moving closer to aging relatives or moving closer to caregivers for the elderly or families with small children. Often, we see a highly concentrated pocket of sellers in one hyper-local area due to many original homeowners who bought at the same time and at the same life stage retiring and downsizing. No matter what motivates someone to sell during a tough economy that shows no signs of improving over the next year, connecting with prospective buyers on a hyper-local level
How to reassure sellers during a tough selling climate.
No matter what the motivation is for selling during a less-than-ideal time, for many, they have no choice, and time is not a luxury they can afford. Even in more stable economic circumstances, selling a home is one of the three most stressful events of a person’s life.
As a seller’s agent, it’s up to you to be empathetic to their situation and provide guidance to help them navigate this stressful time. Here are our top 3 tips on how to be an ally in the selling process right now.
- Be realistic with expectations. The days of crazy cash offers of thousands of dollars over asking and bidding wars over homes that spent one day on the market are a distant memory. Homes are spending a longer than average number of days on the market before getting any offers and many have taken several price cuts out of desperation. Setting the expectations early on in the process can ease some of the stress when homes reach longer than average days on the market and prevent unnecessary price reductions. The real metric to gauge whether or not a home needs to take a price reduction is if the home is still getting showings after 30+ days on market but no offers.
- Make a plan and be flexible. Part of being an ally is making a solid plan but leaving some flexibility, especially when it comes to sales terms and pricing. Anything that can sweeten the deal for the buyers should be on the table, especially if the sellers are pressed for time. Sellers may feel that waiting out inflation and rising rates is the course they want to take, but there’s no guarantee that home prices will stay stable in the interim.
- Be patient. The process can take a bit longer, even with fewer homes on the market. It’s crucial that sellers know that they may be looking at staying in their home or putting off shopping for a new home a little longer than they expected. It’s important to stress the importance of patience during the process.
You may not be an oracle able to predict the state of the housing market in the years to come but starting out strong by connecting with the right sellers can keep you top of mind when they feel ready to take the next step. Having a powerful lead list may very well be the crystal ball that gives you the advantage over other agents, no matter what the market does.