Pricing & Selling Your Home In The Current Housing Market
July 17th, 2010
Since the expiration of the federal tax credit, there is little or less incentive for home buyers to make the plunge. This notion makes it more challenging for current home sellers in making a sale.
Home sellers may have to price their homes more competitively so as to compete with other foreclosures in the market. A large percentage of sellers are already cutting their asking prices to lure potential buyers. 24% of home listings on the market as of the first half of 2010 had experienced at least a price reduction.
Slashed prices are more
common in certain markets if compared to others. In
With the disappearance and the expiration of the federal tax credit, a price reduction is the only weapon available to home sellers in order to lure potential buyers therefore drawing their attention.
Tara Nelson, a consumer educator for Trulia.com says that currently, there are not a lot of perks for buyers to purchase since there is no urgency. Mortgage rates have remained relatively low for quite some time and many are not worried about missing out on the opportunity to purchase.
Sit And Wait
Summer Greene, a real estate
broker for Better Homes and Gardens Real Estate Brokerage in
If it’s worth three to five percent to wait and they don’t have any urgent reasons to relocate, they can wait till 2011.
Housing Forecast For 2011-2012
Moody’s Analytics suggests that the market should continue to fall right through 2011 and is scheduled to bottom by spring of 2011. Celia Chen, senior director of housing economics for Moody’s Analytics says from the 1st quarter of 2010 till 1st quarter of 2011, home prices are scheduled to fall about 5%.
From the start of 2011 till the end of the year, prices are expected to rise less than 1%. Prices are forecasted to catapult and leap 4% from the end of 2011 till the end of 2012. According to Chen, since foreclosures and short-sales are factored in the equation of the market, it will prevent prices from rising rapidly for the next few years.
Chen says that it’s not going to make much of a difference even if you waited a year to sell the home given what’s indicated above. What could possibly change in a year is the increased demand and interest of home buyers which makes it easier to sell the home more quickly.
Currently the market is being pinned down by high unemployment and the sagging demand for housing. She hopes to see the unemployment rate improve by 2011 which will hopefully result in better demand for homes.
If you decided that you are not going to wait out the storm and have the urgency of relocating, it is important to price your home correctly from the start. According to Greene, if the property was priced low enough, you may get several bidders or more than what you had hoped for. She said to do what the banks are currently doing with foreclosures as their goal is to price aggressively and receive many offers.
Tara Nelson of Trulia.com advises sellers not to be afraid in slashing their price if they haven’t received any bites. In addition, if your home has been in the market for longer than average or you are receiving comments that your home is over-valued, consider dropping the price tag.
She further elaborated that small decrements of $1,000 to $2,000 is not going to make an impact unless it represents considerably a large percentage of the asking price. If it’s not a big cut, buyers may sit in and wait for another cut.
Sellers may also want to incorporate online-search in their strategy. Sellers should see if their asking price is bordering between 2 price categories. For example, a price reduction from the above $250,000 category will open up to a much larger audience for the below $250,000 category.
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