Buyers Lament

Today's buyer is in a tough spot. Just a few short months ago, he had his pick of any and all available properties in his price range. He could dictate the terms under which he would purchase the home, and the concessions he expected from the seller.

Back then it was a buyers market. Funny thing is, buyers were not buying. Despite the fact that a home sold during this time could be purchased for less then it could be built for. And, that interest rates were (and still are) outrageously low.

Today's buyer has a different reality. Not only does he not get to dictate terms, he does not even get to say "yes I will pay your price" and be assured that the home will sell. In today's market many neighborhoods are seeing homes sell for ten percent or more over list price (which in many cases is over appraised value already) and they are being asked to waive their right to an appraisal contingency which when in place gives the buyer the right to cancel the transaction if the home does not appraise.

To make it worse, in some cases sellers are refusing to offer the traditional repairs such as health and safety issues, termite clearance, etc. It is not pretty out there for today's buyer. In fact, it is downright ugly.

The buyer of today is a winner if he gets an offer accepted. In most cases, sellers are receiving twenty or more offers in the first few minutes that a listing goes on the market. If you do not like their terms, you still have to agree to them or face the daunting task of finding another home.

All of this is being fueled by a lower than usual inventory of available homes coupled with an ever increasing demand for them. For many the fear of being priced out of the market is forcing them to get outside of their comfort level and pay the price of homeownership or risk once again being priced out because they did not act fast or, aggressively enough.

Sellers on the other hand are not rushing to market. They see that values are increasing dramatically in month to month and year to year comparative analysis. And, they do not want to leave anything on the table. This could be a good strategy in the short term if you are not intent on re-buying anytime soon.

However, if you selling to move up or down in home scale, than you may gain added value on your home of today. But those gains certainly are likely to be absorbed (lost) in your new purchase.

The wiser strategy would be to sell today while our price trend line is still rising. because, anything you buy today will continue to increase in value and therein your equity in your new home will continue to grow exponentially.

As for the buyer who is thinking that his best strategy would be to wait for the market to crash before dipping back into the waters of homeownership. That too could be a risky approach. You see, no one at this time is thinking that we should see a dramatic change downward in our market for the foreseeable future. Your wait could cost you thousands of dollars of lost equity potential. And, several years of your life before this strategy could pay off.

So the five million dollar question I am always asked is this "Is Today Good Time To Buy Or Sell Real Estate?" And my answer is ABSOLUTELY!

See you in escrow.

 

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