It is great time to sell your home if your area is experiencing a seller’s market. Your days on the market will likely be fewer and you probably will receive multiple offers—potentially driving up the sales price. Pent-up demand drives competition, so if demand is high and the number of homes for sale is low, take advantage of it. Homes that are considered unique and difficult to sell will generally have a better chance of selling in a seller’s market. The nicest homes will attract the most attention, but the not-so-nice homes will sell, too, because there aren’t many options.
Seven strategies that will help your sale be easier and more profitable in a seller’s market:
- Sell while mortgage rates are still competitive
Though mortgage rates are higher right now than they were at any point in 2021, from a historical perspective they’re still competitive. But if rates continue to rise, buyers may become more hesitant to purchase homes. If you know you want to sell your home, it pays to list your property ASAP.
- Plan your next move before you sell
In a seller’s market, homeowners are often surprised to find their property sells more quickly than they anticipated. When you make plans to list your home, plan your next move at the same time. Start packing whatever you’re taking to your next home, and sell, donate or dispose of what you don’t want.
Begin searching for your next home. Have a backup plan in place in case your home sells even more quickly than predicted. You may consider renting for a bit so you can take your time finding the right property. You can also negotiate a seller rent-back in order to remain in your home as a renter after you sell it.
- Invest in repairs over upgrades
In a seller’s market, you’re better off focusing on home repairs rather than upgrades. Clean your home thoroughly. Replace leaky faucets with newer ones, but don’t replace kitchen cabinets or countertops if there’s nothing wrong with them. If you feel you must make some upgrades, carpet and paint are the cheapest repairs and yield the most value for the price. Limit carpeting to bedrooms and consider a hardwood look elsewhere.
Some quick and easy ways to make your home more inviting without spending a lot of money are:
- Paint the main living areas a neutral gray or beige
- Store loose items or put them in decorative bins
- Keep electrical cords and wires out of sight
- Put away photographs and other personal items
- Let Citywide recommend a top real estate agent who knows your neighborhood
Choosing the right real estate agent could be the most important decision you’ll make in a seller’s market. Working with a knowledgeable agent can make the process of selling your home less stressful. He or she can:
- help you price your home appropriately for the market—not too high or too low—especially when it’s fluctuating in your area,
- help you stage your home in such a way that it might sell more quickly for a higher price,
- use social media and other marketing techniques to draw attention to your home,
- tell you when the best time is to have showings,
- help you navigate and make the most of a bidding war,
- help you review offers and choose the best one,
- advise you on appraisal issues, if your property appraises below the asking price.
- Compare these factors and concessions when considering seller’s market offers with your real estate agent:
- The amount of the earnest money deposit
- Whether the offer is all cash—or if financed, the proposed type of financing
- Amount of down payment: A buyer with a large down payment has to borrow less, reducing the risk they won’t qualify for their loan.
- Waiver of standard buyer inspections or other contingencies
- Unusual requests: some buyers appeal to your emotions by a sending letter explaining why they want to buy the home and including photographs of themselves, their children &/or pets. Read them carefully to determine whether they are real letters or just copied from the internet.
- An offer to cover closing costs that the seller would customarily pay
- The buyer is willing to give you the time you need to move out or negotiate a rent-back
- More about contingencies
A contingency is a requirement in the purchase agreement that must be met for the sale to close. If the buyer’s contingencies are not satisfied, they can walk away from the deal with their earnest money. Fewer contingencies make a better offer for the seller, because they can slow down the sale and make it easier for buyers to back out. In a seller’s market, buyers are more likely to remove contingencies, especially if there are competing offers.
The most common contingencies include:
Appraisal: The home must appraise for an equal or higher value than the buyer’s offer.
Financing: The buyer can back out of the deal if they are unable to secure financing.
Home sale: The buyer purchases the property only if their own home sells.
Inspection: The buyer requires a home inspection and may cancel the sale if the seller does not agree to complete or pay for necessary repairs.
- Before accepting an offer
Consider all the factors under #s 5 & 6 above. Let your agent guide you through your options as the seller. The highest offer is not always the best. You can:
- Accept the offer you like the best
- Issue a counterofferto one buyer or more than one buyer
- Ask all buyers to resubmit their highest and best offers
- Adjust the sales price, and look for more offers
Waiting for the right time to sell? In a seller’s market, there’s no time like the present! Low inventory and high buyer demand make seller’s market conditions the ideal time to sell. With a bit of preparation for a quick sale, expert agent guidance, and the patience to explore multiple offers, sellers can get the best deal possible for their property.
Sources:
4 Tips for Selling Your Home in 2022 (fool.com)
Buyer’s Market or Seller’s Market in the US 2022 | Mashvisor
Selling Your Home in a Seller’s Market (thebalance.com)
Selling in a Seller’s Market? Maximize Price While Buyer Demand is High (homelight.com)