This is easily the most common question asked of Realtors today. And my typical answer is this: “Why do you ask?” Because the answer varies depending on whether you are coming from a buyer’s or a seller’s perspective.
photo by: 401(K)2013
Most of the time, we have what I might call a “Tale of Two Markets.” Both a buyer and a seller can be participating in the same market — possibly even the same transaction — and have totally different perceptions of market conditions.
Let me explain.
Here’s how a buyer might interpret the market today: The number of homes for sale in our MLS was down 23 percent for the month of December versus the same month in 2011. This drop in inventory has not only created more multiple-offer situations, it has also caused values to hold steady — and in some areas of town even increase.
Yes, I said increase.
Therefore, a buyer in today’s market might feel more of a sense of urgency to purchase before they have to pay more. The days of dragging your feet are slipping away now that supply and demand are more in balance. In a nutshell, good homes are selling quickly so buyers need to stay informed and be ready to “pull the trigger” when they find the home they’re looking for.
And here’s how a seller might interpret the market today: “Happy days are here again!”
Ok, that might be a little over the top, but it’s not far off. Unlike buyers, with inventory down today’s sellers are feeling more confident. The long buyer’s market that we were in for the past five years left quite a few sellers feeling like they were at the mercy of the market — while buyers felt like kings. Not anymore. With homes staying on the market 20 percent shorter than they did a year ago — down to just 92 days, on average — homes are selling more quickly. And they’re selling for 93 of original list price, on average. To be clear, the buying and selling process is still a “price war” and a “beauty contest,” so professional staging and strategic pricing are still crucial to succeed as a seller today.
From my vantage point, our market is clearly improving. If you are a prospective buyer, I encourage you to stay educated, know your “non-negotiables” for a future home and be ready to confidently “pull the trigger” when it comes on the market.
And if you are a prospective seller, the best advice is get in early in an inclining market like ours. As the good news spreads, more and more sellers will decide to get in the game. Last year the Spring market started in February. This year shouldn’t be much different, so don’t delay.