Richard Courtney recently published his monthly column, and it was good validation for my own take on what’s happening in our market.
When I made a deposit at the bank today, the teller asked if my business is doing OK. I told her that we certainly could feel a “cooling” coming on but that my business was moving along just fine. I mentioned that lack of inventory, a natural seasonal ebb, and the National Political and economic shenanigans were all contributing factors.
It’s tough to sell a house to a willing and able Buyer when the supply of available houses is near zero.
I asked her how SHE knew the market was tapering, and she replied that Mortgage applications have fallen precipitously in the past month . . . Projected December closed loans are currently WAY below par.
It was then that I realized my phone has been ringing more with Lenders and Title companies soliciting my business.
So . . . Here’s my take on what’s happening Here in Middle TN:
The sky is NOT falling.
Yes! We are experiencing a break in the action, but let’s consider a few things.
It was about this time of year in 2012 when our market awakened from a long and painfully slow slumber. Inventory was HIGH . . . TOO MANY houses on the market, and values were slimmer than most Home Sellers liked.
The Buyers came out of their hibernation and began absorbing the inventory and before we knew what was happening, we found ourselves in a frenzy of home Buying . . . each month was statistically 25-30% higher in houses sold over the same month of 2011 . . . and this continued for 9 straight months.
We ran out of inventory . . . Scarcity of condos AND houses.
The builders were building as fast as they could but were starting from behind and could not secure financing for building speculative houses . . . As the inventory shrank, the value of the land began increasing . . . as the builders were building more houses, the material suppliers were not able to supply the increased demand . . . so material costs INCREASED . . . Labor costs also rose . . . and the rate of rising house values was squelched because there were not sufficient comparable sales . . . the profit margins for the Builders was being squeezed from all sides.
Instead of building condominiums, the commercial builders commenced construction on several large apartment developments.
All of this has created a “Zero inventory market” which lends itself well to an environment of Multiple offers and frustrated buyers.
Statistically, we are now comparing our 2013 months entering the naturally cooling season with the months in 2012 when the market was heating up.
The Buyers who don’t like to play THAT game have thrown their hands up in disgust and QUIT . . . either staying in their current house or finding an apartment in which to roost until the environment becomes more buyer friendly.
We all DO have a choice. We don’t have to play by the rules of accepting it’s a “cooling market” and hunkering down for winter hibernation.
What we do is CREATE INVENTORY!
In my 20+ years as a Real Estate Sales Professional and Broker, I believe NOW is possibly the BEST time EVER to list a house for sale . . . The market is waiting in anticipation of YOU putting YOUR house on the market.
You can’t just throw it out there “As-Is” because the buyers who are out there looking have very discriminating taste and expectations . . . they want up-dated, tasteful decor, zero deferred maintenance, and hassle free availability.
All of this takes some time, work, money, and inconvenience for the Seller, but these Buyers are willing to pay TOP DOLLAR for a house they can move into quickly with minimal hassle.
there now . . . I said it . . .
If you have a house you have ANY inkling whatsoever to sell, connect with me and let’s work together to position it perfectly in the market.
I think you’ll like the results.