Consumers and professionals know that today's real estate market is kind for buyers but very harsh on sellers. The vast inventory and the impact of distressed properties are stringing out the present market and projecting a course that is likely to be around for a good long time. One prominent presenter at the national Real Estate Educators Association conference a few days ago in San Antonio remarked that if there was not another house built it would take seven years to sell off the current inventory that is on the market in America today.
Sellers working through the buyer's market must be realistic with the market conditions, especially the valuation aspect of the process, if the seller hopes to see a sale that shows any favor toward to seller. Appraisals are coming in quite conservative. There is major pressure on appraisers by regulation and it is going to increase. The property must be in good market condition, dressed for market show, and priced to get the purchase nod, or the seller's property will stay on the shelf. And in our current conditions, it may be there for some time.
As buyers position themselves to take advantage of current market conditions which generally favor the buyer side of the venture, there are a few basic and common events that are present and recurring bringing a purchase to the benefit of the buyer. Obviously, the stronger the buyer's financial condition, then stronger the buyer's bargaining ability. In the buyer's market, it is important to keep up-to-date on price adjustments. Right now, there are some large cuts in pricing on select properties.
It is also important to shop around for mortgage terms that are not only competitive, but advantage to the buyer's position. When offers are made, it is quite common today to see various contingencies in the offer beneficial to the buyer. Often, sellers are asked to contribute money toward buyer's closing costs or fees.
Buyer's offers now typically have a short time period for acceptance. The offer also asks for the seller to provide inspections and home warranties at the seller's expense. It is quite common that a buyer will have a certain price in mind that when in the process of negotiating the offer and counter offers, if that price is not met by the seller, the buyer will walk away from the process and leave the seller wondering "where did the buyer go?"
Since the real estate market is a reflection of people and their property interests as owners and investor/want-to-be-owners, the market dynamics are ever sharpened. Sellers who have a very strong desire, a have to or must sell situation, obviously are impacted directly by the demands of buyers. Some sellers are able to absorb the deep discounting of price in order to get a buyer and be able to move on to their next property or destination. Buyers who are well qualified and able to borrow in today's lending climate will be able to take advantage of the current conditions.
This market reflects all aspects of real estate marketing and selling principles that have been around for decades. However, conditions are exacerbated today because of the deep economic impact and the far reaching affects upon essentially all levels of society. We are also seeing government intervention and regulation that we are unaccustomed to and have not seen during recent times and extending back for a long time. As this good, bad and ugly market plays through, there will be big time winners and devastated losers as the fittest survive and the pool of have-nots increases.
St. George REALTOR® Jim Coleman is Associate Broker and Partner/Owner of ERA Brokers Consolidated. He Specializes in Residential, Investment and Commercial Real Estate, holding National Designations of Accredited Buyers Representative (ABR), Certified Residential Specialist (CRS), Resort and Second Home Property Specialist (RSPS), Seniors Real Estate Specialist (SRES), Certified International Property Specialist (CIPS), GREEN Property Specialist, and Certified Short Sale and Foreclosure Resource Specialist (SFR). You can contact him by e-mail at Jim@JimColeman4Homes.com. Call: (435) 627-5411; or write: Jim Coleman, 201 East St. George Boulevard, St. George, Utah 84770. This and other columns are available at www.WinningTalk.com/articles.