This month, we thought we’d tackle a frequently asked question from both buyers and sellers.
Buyer Question: is now a good time to find a deal or am I better off waiting until the new year?
Answer: This is a more nuanced question than most buyers realize. Options are very different than deals. If you’re looking to pull the trigger and you haven’t found a property to your liking, then waiting until inventory picks up in the new year is likely a good idea. You are likely to have more options that might make your heart pitter patter when more sellers decide to finally list. That said, and here’s the rub: if you’re looking for a real deal, waiting may not be your best option.
Why? First because the new year’s inventory increase is also likely to bring with it competition in the form of new buyers who have chosen to sit out the market until the election and holiday dust settles. This means that those very same properties that might move you to act are likely to be the ones prompting other buyers to act, reducing your likelihood of getting a “deal”. More importantly, however, these new buyers are also likely to consider properties they’ve never before seen and may, themselves, be looking for bargains. That property that’s been lingering on the market for the last 5 months? That’s the one that you can likely negotiate to its most attractive levels now, when you have less competition and when sellers are really sweating it out. Trust us: if a seller’s property is 5-6 months old, they are not stress-free. This is not to say that a seller is financially stressed but likely to negotiate in order to sell.
It may be worth your while to revisit properties you’ve seen before but passed on, and burnish your negotiations stamina so you can get the deal moving. Sellers know that this means their properties are unlikely to trade until January or February at this pace, so they may be more willing partners in the transaction. Remember: finding the property is only a fraction of the battle. You’re working with a broker partner to help you navigate the entire process and, most importantly, negotiate on your behalf. Endless research studies have shown that we are our own worst negotiators; don’t let YOU get in your own way! We can sift through the influx of information you are receiving, help you make sense of it all, devise a disciplined purchase strategy and hold your hand when the going gets tough (as it almost always does).
Seller Question: How do I know if I’m holding on to a property that I should consider selling right now? (i.e. What’s selling?)
Answer: If you are thinking of selling, this is what we recommend based on what we’re seeing buyers looking for right now:
Millennials defining demand: studios and 1-bedrooms are moving! If you’re considering listing your studio or 1-bedroom, this may well be the right time as it is the hottest segment and represents the largest buyer base at this time. Most of the demand in this market segment is driven by millennials, most of whom are looking for turnkey apartments. What does this mean for you? If your property is dated or stale, it may be worth investing in a quick renovation and some sprucing up of appliances and finishes to make it move-in ready and effectively woo this demographic. Putting some money into your unit will pay off in terms of fewer days on market and a potentially higher valuation.
Pricing sensitivity for larger footprints: conversely, properties with 2+ bedrooms are currently defined by increased price sensitivity. Unlike the potential bells and whistles that may work for smaller properties, across all larger bedroom counts we’re seeing the themes of price, price and price rule. This is regardless of whether or not your home sits on the market for longer than you’d like. So make sure you do your homework, get a very specific and granular set of comps, price accordingly, and keep track of competitive properties as they emerge.