In A Market Like This BOTH Buyers And Sellers Need To Adjust Their Expectations
I can’t believe Summer is almost over and it’s back to school season! And while the change in seasons was gradual the shift in our market was dramatic. Buyer frenzy slowed significantly as the inevitable clash of rising prices and interest rates coupled with an increase in inventory took its toll. Buyers have more options and a little more leverage.
But in our area it's like a tale of two markets - Eastside vs Seattle. During the pandemic, Seattle experienced a downturn while the Eastside saw major uptick. Now, as employers expect more in-office work and recent city elections promising to address some of the city's problems, we are seeing a Seahawks style 4th quarter comeback for Seattle. In fact, in some areas of Seattle, I'm in multiple offer & bidding war situations. But, on the Eastside 3 of my recent listings either settled for less than asking or had to reduce their price before going pending, a consistent theme on this side of the lake.
In a market like this BOTH buyers and sellers need to adjust their expectations.
Sellers should expect to negotiate on price and receive offers with contingencies. But buyers also need to be realistic and understand that while sellers may be motivated it does not mean they are desperate. On two different listings I've received calls from agents wanting to offer between 15 and 20 % below list price – even though the data shows an average final sale price between 3% and 7.5% below list. Buyers, it’s true with higher rates your money doesn’t go as far as it used to but that is not the seller’s burden. As I discussed in last month’s market minute, buyers would be better served negotiating a little on price while also asking for seller credit to use to reduce their interest rate so that their payment is effectively the same as if they’d negotiated a substantial discount.
Buyers, the bottom line is, it’s important to work with an agent who can manage your expectations and analyze the market to help you make an informed offer strategy, and more importantly - one that keeps the negotiations moving in a positive direction vs. shutting down the dialogue completely. Sellers, pricing your home attractively out of the gate and being patient are key but so is having a plan B - whether that is to rent out your home or wait until January to re-list when there is less inventory so yours stands out.
A final note, while the market is changing it is not in a free fall or approaching bubble territory. Not only are experts forecasting home prices will continue to appreciate, but most of them also actually increased their projections for home price appreciation from their original 2022 forecasts and predicting an average of 7.5% price growth by end of 2023.
So if homeownership is a goal of yours, let’s talk today to help you make that dream a reality.
Call/text or email me anytime! ginam@windermere.com.
