If you’re thinking of selling your home in 2018, this one’s for you.
In 2017, most Richmond area sellers got good results:
- Their homes sold close to or above asking prices
- Average times on market continued to drop
- Selling prices continued their six year climb with the Richmond house price index just about at the record 2007 level
Some current house shoppers might be worried about that last point, since 2007 will go down in history as the great real estate bubble that burst in 2008, dragging down the whole economy. Are we now on the slippery surface of the next bubble?
Should Buyers worry about losing a big chunk of their equity if they buy this year? Well, there’s no guarantee that some people won’t make foolish decisions, but I don’t believe that a 2007-style bubble is imminent. That’s because the bubble that brought on the recession was largely a product of an irresponsible mortgage market — we should worry about a bubble when we see a widespread return to one year ARMs, interest-only mortgages or 100% LTV mortgages. Also, the home ownership rate back then reached a record high; today it’s at a 50 year low. So Buyers should breathe easy, do their homework and shop for their dream home at a good price based on prevailing market conditions.
A Sellers’ Bonanza?
At the time of this writing in January, 2018, the RVA real estate market is sending Sellers some very positive signals:
- Current inventory continues its fall to record lows
- There are fewer active listings than last winter, continuing a multi-year trend
- Even in the slow season, more than half the homes sold since December 1st were on the market for 21 days or less.
- More than half of them sold for 99% of their list price or more
- One in ten homes sold since December 1st was on the market for more than three months
- One in ten homes sold since December 1st sold for 89% or less of its original list price
- In the last 100 days, over 2,200 would-be sellers gave up without a sale
Yes, statistics can be used very selectively!
The bottom-line lesson is that success is not guaranteed. For starters, overall market statistics aren’t very relevant to individual Sellers because there’s no such thing as an overall market! An equine estate in Goochland, a new home in Hallsley and a Cape on Patterson Avenue are not competing in the same marketplace. So part of your expectation of success (however you define it) depends on the specific niche for your home.
The Good News
You can beat the odds (even when they’re good!) in a competitive market by precise execution of a winning strategy.
Specifically the most successful sellers
- sell when demand is highest
- meticulously prep their home
- have the best marketing plan
- have a list price that looks right on day one
Here are some tips on each of these success factors.
High Demand Season
Nearly 60% of sales close between April and September. Prices are also higher in the Spring, more folks are shopping and houses sell faster. Considering that most closings occur a month or two after contract signing, the surest way to capture the highest demand is to list in March or April.
I’ll address this one with a rhetorical question. Two identical houses are for sale side by side. One of them has immaculate landscaping,fresh paint inside and out in harmonious colors, every appliance, fixture and lightbulb is in perfect working order, the furnishings complement the home design, everything is sparkling like new.
Which one is most likely to sell first and for the highest price?
Aim for perfection the day the house goes on sale!
You know the old adage, “If you build it, they will come.” Well, if you have the most amazing home at the most amazing price, that might be true. Otherwise, I strongly recommend an excellent marketing plan tailored to your home. I’m assuming you want the best price, the best contract terms, the fewest days on market and the least hassles with your home sales experience. If so, you need to get an accurate representation of your home in front of the most financially-qualified, motivated Buyers who are going to fall in love with it. An effective marketing strategy has a lot of moving parts, and targets both Buyers and the Agents who are likely to show a home like yours. At One South, every listing is backed by a full-time marketing team and the collaborative knowledge of our entire sales force. Maybe that’s why we constantly beat the competition in sell through rate, days on market and closing price as a percentage of asking.
Art and Science of Pricing
Just about any agent can perform a basic Comparative Market Analysis (CMA) that grounds a price estimate in past sales. (Some even boost those estimates to put an extra gleam in the seller’s eye!) But effective pricing is grounded in the prediction of buyer behavior. That requires going beyond the past to consider current market conditions and near term forecasts based on immediate inventory and sales trends. If a discerning buyer is surprised by the listing price, you don’t want them to come away after the visit muttering, “Now I know why it was so cheap!” Better they should say, “Now that price doesn’t look high after all!” Best of all, we hope they’ll say, “That price still looks like a great value!” That happens when the home preparation, marketing and pricing all work together with the assistance of a great marketing and sales team!
My Offer to You
Invite me over for a preliminary conversation about your goals. I’ll tour your home and share some initial impressions about what might be needed to get ready for market. I’ll also walk you through the steps of the One South strategy and its remarkable success over the last ten years.
Even if you aren’t planning on listing until March, I recommend an early consult and pre-inspection to allow time for planning any work that needs to be done before listing. Remember, the best tradespeople get booked well in advance.
Martin Ahrens, Licensed Realtor Call or text: 804-658-7718
One South Realty Group Martin.Ahrens@OneSouthRealty.com
2314 West Main Street
Richmond, VA 23220