Every year, Ilyce and Sam offer their readers New Year’s resolutions for home buyers, sellers and their personal finances. These are their 2023 Home Seller Resolutions.
We feel like a broken record, but 2022 was still one of the best years on record for home sellers.
Despite mortgage interest rates rising at an all-time blistering pace, according to the Federal Reserve Bank of Dallas, home prices continued to rise all year. According to the National Association of Realtors, a massive U.S. housing shortage meant that there were still not enough homes to buy.
It’s simply a question of supply and demand, as the economists like to say.
But times might be changing, at least a little. As we end 2022, mortgage interest rates have come down a bit from recent highs, and in some places, home values seem to be declining as well. It can be tough to tell what’s really happening with housing prices, since the average could swing significantly if more high-end homes or lower-end homes are sold.
The real question for real estate industry observers is what will happen if the Federal Reserve moves the federal funds rate higher. The Federal Reserve Bank has indicated it will continue to raise the federal funds rate in 2023, though perhaps at a reduced pace. Fitch Ratings, a registered Nationally Recognized Statistical Rating Organization (NASRO), expects the Federal Reserve to bump up the federal funds rate by 25 basis points (a quarter of a percent) at its February 2023 and March 2023 meetings.
Mortgage interest rates may go higher as a result. But because of the lack of demand, sellers will be in the driver’s seat for some time to come. That’s not good news for home buyers. Or for the agents and brokerage firms who represent them. But, it’s good for anyone thinking about selling (as long as you don’t have to turn around and buy on the other side).
To maximize your sales price, here are some home seller resolutions you may want to adopt:
Home Seller Resolution #1: Price your home correctly to generate the most interest
Bidding wars were extremely common during the pandemic. While those are declining, you can still generate significant interest by pricing your home competitively. Pay attention to the options your listing agent brings to the table.
Pricing your home competitively may generate a number of offers in excess of the list price. Or, you may just get the right buyer to your door within a short period of time. What you want is to generate interest and showings and a “pie in the sky” price won’t do that, even with the dearth of homes for sale.
Home Seller Resolution #2: Adjust your expectation to meet market demand
During the pandemic, everyone heard stories of their friends, relatives and neighbors selling in a bidding war within hours of listing the property. And, in many cases, that’s what happened. But as we near the end of the third year of the pandemic, rising interest rates have scaled back demand somewhat. While homes still sell briskly, don’t expect to sell yours in minutes, hours or even days of listing it.
Try to adjust your expectations to meet local market conditions. Talk with your agent about how quickly or slowly homes like yours are selling. Think carefully about the list price (and ultimate sales price) of comparable properties and where your home fits into the picture. Then, take a deep breath. Selling a home can generate a tremendous amount of anxiety, especially if you’re trying to buy a home at the same time.
Home Seller Resolution #3: Create a standout online presence for your home (even if you’re selling it vacant)
There may not be a crowd of homes for sale, but you want yours noticed for all the right reasons. And the way you’ll get noticed is to create an online presence for your property that stands out from the crowd.
Almost every buyer starts their search online. More are closing the loop digitally as well, making offers sight unseen for properties they’ve come across on the web. Anyone looking in your neighborhood will see that your home is for sale if you have a robust online presence.
What does that mean? If possible, paint the walls white, remove extraneous furniture, artwork and knick-knacks. Stage your home with neutral furnishings, do a deep clean and replace carpet as needed. Replace old fixtures with modern LED lights. Open or remove window shades and clean the windows. Charming exteriors will get noticed faster, so don’t forget to give your garden an upgraded spring cleaning and plant colorful flowers. Repaint where needed.
Make sure the online description of your home includes the correct keywords and as many photos as possible. Any agent worth their salt will know how to get that listing seen in as many places as possible.
Home Seller Resolution #4: Decide in advance what is the minimum acceptable sales price – and then stick to it
When it comes to selling your home, getting greedy is one of the biggest mistakes a home seller can make. Fighting tooth and nail over every last dime is a fast way to kill a deal, even in a relatively hot seller’s market. At some point, the buyer will stop caring about your home and withdraw. And, then you’re back to square one.
The best thing you can do is decide what is the minimum sales price you’re willing to accept. Write that number down and when the first offer rolls in, look at that piece of paper and see how it compares to the offer. If you’re at or above your minimum acceptable price, you’re in good shape. Everything else is gravy. And, if you get your minimum acceptable price, we think you should relax and feel good about the deal.
We believe that the best real estate deals happen when everyone walks away happy. As a seller in 2023, resolve to move on graciously, grateful for the time you’ve spent within those four walls, and for the buyer who will care for your home going forward.
Happy New Year!!