How Can The Market “Come Back” If It Never Left?

This morning a young gas station attendant noticed the real estate signs in the back seat of my car. He was very excited as he said “The market is really coming back!” Although the market never left, I knew what he meant as a consumer who learns what he can from the news media. The market consists of a property, a seller, and a buyer period. Properties are bought and sold every day everywhere. Factors such as the economy, supply and demand may affect the market, but the market itself goes on like “Old Man River”.

One key point that appears to be misunderstood by many consumers is the fact that the increase in market activity does not mean increase in home prices. It means increase in the number of homes that are being sold now. Home prices will increase again, but those prices will not be increasing anytime soon. “Real Trends” (http://www.realtrends.com/) is a resource upon which Wall Street and the Real Estate industry rely for accurate research data. The CEO is Steve Murray who found that the prices of 2005 will not be seen again until about 2020. “Standard and Poors” estimates that the price of a property purchased in 2003 has returned to about that same value right now in 2009.

During the height of the market in 2005, a listing Realtor could hang a Purchase and Sale contract out the car window and buyers would chase that car down the street in bidding wars to entice the seller to accept over-asking prices for the high priced properties. In the years that have followed that hay day, the inventory has increased with over priced properties that have languished on the declining market for longer periods of time. In addition, as a direct result of the irresponsible lending practices over the past several years, we have seen the tidal wave of short sales and foreclosures that have contributed to declining prices.

The pricing overall has been corrected and homes are more affordable now than ever. The very low interest rates and tax credits for first time homebuyers have enticed consumers to act now, hence the increasing market activity of homes being purchased.

If your present home no longer meets your needs, price it intelligently, not “hopefully” and it will sell to a buyer who will purchase it intelligently not “dopefully”. One of the most common concerns voiced by sellers is “I don’t want to give my house away and then have to pay too much for the house I buy.” The market exists and continues across the board. All home prices were high in the hot sellers’ market, and all prices began to fall in the buyers’ market. If you sell at a lower price than you had hoped for, know that the seller of the home you wish to purchase has had to do the same with you.

Another common concern voiced by sellers is “I don’t want to put my house on the market until I know which home I will be purchasing.” The key to a successful move is to focus on the sequence of events that must take place for the most successful outcome. Unless you are able to carry two mortgages until your home sells, you must sell your home before you can purchase another. Being on the market can be very stressful for a number of reasons, so here are some tips to navigate from one address to the other and minimize the stress. You must have a plan.
Put your property on the market and price it intelligently with your chosen trusted advisor.
Looking for the right home can be a full time job. Work with your trusted advisor to narrow your search and save countless hours.

Be sure you have an updated pre approval letter from your lender.
Have a contingency plan in place in the event that your home sells before you find your next one. (Selling your home is the biggest hurdle and it should be a cause for celebration, not concern.) Many folks can rent storage and stay with family. One other increasingly popular option for that “in between” time are short term rentals at major complexes and huge hotel townhouse accommodations for relatively affordable costs. These interim accommodation places are on the rise in response to the growing need of consumers. (Ask us here at the “Crossroads” about discounted rates that a major hotel chain offers to our clients who use our name).

Know that when you put the cart before the horse, you will inevitably walk into the house of your dreams only to find that it will be purchased by another buyer who took that leap of faith and got his property sold first. No seller wants to wait until you sell your property when there is a ready willing and able buyer standing next to you at the open house.

The market is not “coming back” because it never left in the first place. Take that intelligent leap of faith and know that every home sells at the right price and time without exception. Good luck and we’ll be here to take that leap with you!