Even if you are living under a rock you can’t help hearing about the real estate market and how crazy it is.
Perhaps if you are a seller, though, it has taken a little bit longer to realize that it no longer is a seller’s market where you get to call the shots.
So seller beware! It is a buyer’s market and the buyers know it.
I was out with a new buyer the other day and we were viewing a great house that was very well priced.
The buyer turns to me and says, “What would you offer on this? My friends told me you should offer at least 10 percent below the asking price.”
I think her friends must have read the same article I have sitting on my desk, written for buyers. The first thing it suggests a buyer should do in this market is offer 10 percent below asking price.
But wait. What if the house’s asking price is already a screaming deal? What if the sellers are completely on board that it’s a bad market and they priced accordingly? Doesn’t matter! Seller beware. It’s a buyer’s market and the media says 10 percent below is the magic number.
But surely if a buyer is willing to put an offer on a home they must truly love it and picture themselves living there. There must be some sort of emotional attachment, right? Wrong! Seller beware. It’s a buyer’s market and decisions are no longer wrapped in emotion. Buyers’ decisions are driven by the best deal they can get – how low they can get the seller to go. I’ve seen many “lowball” offers come through and sellers countering back at reasonable prices (closer to the offer than the asking price) – ready to play the negotiating game and find that middle ground.
But instead of jumping in the ring and playing with the sellers, buyers are walking: “If you don’t meet my price, I am going to move on to the next one. I have plenty of options.”
And let’s suppose you get past this first hurdle of settling on an appropriate price. Then comes the inspection period. Even the age of the home and the fabulous price they negotiated for the home will not deter buyers from asking for every teensy-weensy little repair to be done, and then some.
Typically, sellers are expected to take care of health-and-safety issues, and sometimes deferred maintenance items are addressed. But in this new market where the buyers are in the driver’s seat, they are asking for the stars and the moon.
I recently had a transaction involving a 30-year-old home where the buyer requested every little tiny thing be brought up to excellent, like-new conditions, including the insulation, despite the home’s history of low energy bills.
So seller beware. Many buyers in today’s market expect not only repairs to be done, but upgrades, too!
What can you do as a seller to help make this all go more smoothly?
First, be realistic. Don’t believe that you will be the chosen one to be spared from this. Be prepared for the reality.
Next, have a good agent to help navigate you through the twists and turns of this crazy market. Find someone with good negotiating skills and the ability to hold things together – even if it is by a fine thread.
Also, work with your Realtor to prepare in advance for some of these issues. Price accordingly, and perhaps have some inspections done up front so you know what you’re getting into or to set the tone at the time of the initial offer, communicating a cap on repairs.
It always helps to know your limits in advance and plan your course of action accordingly.
To all you sellers out there: I’m not typically one for jumping on the “doom and gloom” bandwagon that the media portrays, but I think it’s important to occasionally take a ride on the reality train.
Seller Beware! It’s a buyer’s market and buyers know it!
Lara Wells Osborn is a Redding native. After traveling and working around the world she has returned to Redding with her husband and three children. Lara was the No. 1 producer in her office for the first quarter this year and was in the top 7 percent of Coldwell Banker agents nationwide in 2007.
Contact Lara Wells Osborn at Coldwell Banker C&C Properties – Westside, 1801 Buenaventura Blvd., Redding, CA 96001. Cell: (530) 276-3026. Fax: (530) 419-1167. E-mail: laraosborn@ccproperties.com or www.larawellsosborn.com.
