What are you crazy? Sell now in this market?

Thinking of selling now or in the future? 

Every day that goes by in a declining market, a property loses a bit of its value.  So the longer the property is on the market, the more the seller is chasing the market down.  A property must be priced right from
the very beginning or risk becoming stale and simply not selling at all. A SELLER in a buyer's market really has to be motivated to sell and understand that they will not get what they would have gotten in the
seller's market a few years ago.  This is a fact that one has to accept. If you think the market still has further down to go, then the decision to sell becomes a question of predicting how long the market will take to recover. Is it 2 years, 4 years?  In a declining market, a seller gets their best price NOW, not in the future. 

The best strategy is to price the property right from the beginning.  In many cases, this will mean 5% under the recent comparables.  This ensures that the property has its best chance of selling NOW because in a declining market, the in the future you will get LESS not more.

If you are considering selling your property and purchasing another, it is good to pay careful attention to interest rates.  For example, a rise interest rates erases declines in the market.  A 10% drop in home prices is nullified by just a 1% increase in interest rates.  For example - if the home price is 200K
and the interest rate is 6%, the payment for a 30 year mortgage is $1199.  If the home price dropped 10% to $180K but the interest rate increased a point to 7%, the payment is $1198, or exactly equal!

I guess the bottom line is - its a great time to buy, not a great time to sell.  What would I do?  For me it
comes down to where I would want to be long term and if I could stomach pricing my current place to sell quickly (which in a declining market, you want it to sell quickly, because that is the best price you will
EVER get until the market starts upward).  If you are trading up, this is a great time to buy but that's for another post..........

Comment Notification

Subscribe to this post's comments using RSS