Why is buyer demand down from 2014?
I’ve had a very successful but tough year thus far and now drawing toward the end of season, I along with many other agents continue to do our best to manage some frustrated sellers expectations; “I thought the market was improving? Where are the buyers this year? What will it take to get my home sold? Why must I reduce my price? What do you think will happen over the summer?
There are various reasons why the overall number of sales this year have dropped off from 2014, when we all expected the market to continue to improve. As we look back in history, moving closer to presidential elections can tend to slow sales down, along with concern over the economy. As the market gradually improved and more homeowners decided to sell based on positive signs in market momentum and growth, many sellers and agents simply set their expectations too high. Many overpriced properties slowed the momentum in the market and inventory simply outpaced demand. The fact is an overpriced home today will likely sit unsold. Price is and always will be the #1 factor in selling your home, it simply has to make sense to a real buyer based on current market conditions, comparable offerings, and recently Sold properties. If you are not getting enough showings, not getting offers, and continue to sit unsold, create a meaningful price reduction campaign in an effort to protect your equity, and at the same time show buyers you want your home SOLD.
As I have reiterated in the past, I believe high levels of inventory and slow selling price pockets (example $700,000 to $1 Million) have not only concerned and frustrated sellers, its concerns buyers as well. Not only are there less buyers, there are little to no emotional buyers. Cash buyers know “cash is king” and great for negotiating better terms, along with very attractive mortgage rates & products. Pragmatic serious buyers understand this is a good time to buy, and want to buy right. They also know that Inventory levels will likely drop over the next year, and mortgage rates cannot stay low forever… so do not panic. As usual much of the seasonal inventory will drop off the market for the summer, and many serious buyers will very likely continue to hunt the desert in high-heat to lock up good buys.
The low and high-ends of the market are performing best which makes buying in the mid-line pricing crème of the crop, and a total buyers’ market. If you’re thinking of selling and buying another home; either stepping up or down in how size, now is a very good time to make your move. You may sell slightly lower that you would like, but you can count on very likely getting a great buy on your purchase side… so it’s a trade off or lateral move. Click here to see an example of a killer deal in South Palm Desert.
In closing, I have some listings that have not yet sold this season with sellers that definitely want to sell, and do not want to accumulate the number of “day of market” through the summer. If I do not sell these homes by the end of June, I’ll be holding some of them as “pocket listings” (not in the MLS) throughout the summer in a continued effort to help get them Sold.
If you know anyone thinking of buying or selling, have them reach out to me and I will be sure to look after their best interest.
Have an awesome Memorial Day weekend ahead!