How long has that sign been in your yard? Are you advertising for your agent or are you selling your home? The January sales figures are out and they are not good if you look at them for raw numbers. If you dig a little deeper you see three different stories developing.
The first story line is aggressive agents promising low commissions and high prices to get signs up. This makes them look busy and makes them look like they "own" part of an area. At the end of the day though, most of those "sellers" are simply advertising for the agent whether they realize it or not.
During a recent meeting with a potential seller, he asked "How come {Agent X} has so many more listings than your whole office?". My answer was simple. "How many days have those signs been up and when was the last time you saw one of our signs go over a couple of months?" We sell homes, the other agent lists homes. The more agents I talk to around the country, the more we are seeing this phenomenon. It might be partially the sellers fault though.
The second story line is about the sellers. The average listing price per square foot took a big leap at the end of the year, and the number of new listings dropped. Some sellers saw a market rise last year and simply said "Hey if I can get $XXX for my home, I'll sell it." so some agent slapped up a sign and there it sits. Other sellers decided that it was a good time to sit and wait a bit longer while prices keep rising. Fewer listings and fewer sales equals a stalled market.
The third story line is about the buyers and their banks. New rules limit how much a house can go up in value when an investor buys it to sell it in less than six months. The quick clean and flip is essentially gone. Also the FHA changed the minimum down payment to 5% but does allow a "gift". Some banks are using seller points to offer some similar programs that help with closing costs and down payments.
The real problem here is a combination of cash and credit. Even with rates hovering in the 4% range, banks are still quite cautious about a buyers real income, and many buyers simply don't qualify. More simply don't have the spare cash for closing fees and a downpayment making it an excellent investment market for those who do. Rents in many areas are very close to PITI payments on the day of closing. Normally it takes 5 years or more to get positive cash flow out of a rental. Now If you buy right you can have positive cash flow day one.
If you want to sell your house, the NAR statistics show a couple of interesting trends. The homes that are priced right sell within 10 days or 10 showings. If they don't, they are overpriced. If you want a top of the market price, you are likely going to pay top of the market commissions for a very aggressive marketing campaign by your agent or you are going to end up being a billboard for them.
Another option is to price low and take the high offer. The risk here is not paying enough commission for great marketing to get the best price. The MLS alone won't do it.
At the end of the day as a seller, it is your choice.
For more information about buying or selling a home feel free to call, email or post a question on my Facebook page.
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