On March 4, 2015 I wrote this article discussing the issue of decreasing available inventories. I made some recommendations at that time and those recommendations are STILL true to this day. Call to find out the BEST way to take advantage of these great market conditions.
Those that have done business with me or that have ever had a real estate conversation with me know that I love to talk about the numbers in real estate. By definition, trends are discovered over a sample amount of time. From those trends we can make
predictions, important decisions, and potentially- make some money!
Comparing the previous two years to each other, there is a trend in the works that has been very noticeable on the surface. This trend follows and proves one of the most elementary laws of economics: Supply and Demand
. As an agent working in
the trenches everyday, I have made quite public my opinions and observations
on the lack of listing inventory in Shiawassee County.
The one thing I was not quite sure of, until now, was whether or not prices have began to creep up as a result of increased demand and lower supply. The statistics derived from the Greater Shiawassee Association of REALTORS Multiple Listing Service
show just that.
I am a firm believer that if a writer or advertiser is going to cite sources for statistics that you should
always cite the exact
source. “The internet”
or “MLS Statistics”
should never be taken as an actual or specific source to be cited.
Listings Taken 597
Listing Volume $60,137,223
Average List Price $100,732
Closed Volume $28,003,805
Avg Sales Price $84,348
Listings Taken 540
Average List Price
Closed Volume $24,697,467
So the trend is simple to see….maybe even to the untrained eye: Listing inventory has continued to decline from year to year. As do units sold. The good news? According to the Law of Supply and Demand; prices
have increased 14.7%
from 2013 to 2014.
So now we have to decide what to do with these discoveries. I believe it is quite simple and I believe we have to look at it from two perspectives. We have to look at the numbers as a buyer
and we have to look at the numbers as a seller
. Both potential parties that will be effected by the above trend.
While prices are currently on the rise, we don’t know how long this trend will continue. We do know that right now
, because of the season and because of overall
declining inventory, there is very little competition for your home currently on the market.
- If you have tried to sell your home in the past three to four years- now is the time to talk to a professional
about how the current market conditions have affected your ability to sell your home.
- If you have considered the idea of selling your home sometime in the recent past or have considered it in the near future- now is the time to talk to a professional about how the current market conditions have affected your ability to sell your home.
These are new and relatively unique market conditions that this area has not seen in at least 10 years. It is more accurate to say we haven’t seen conditions such as these in 20 years. Even then, interest rates were not anywhere near as low
as they are now. In order to maximize your benefit from entering this market as a seller, you are going to need to find an agent that understands the “ins and outs” of a market like this. You would also benefit from speaking with an agent
that is also able to identify the potential pitfalls in entering this kind of market as a seller.
Marketing strategies, pricing, and market knowledge are key to understanding how you can best benefit from a transitioning and improving market.
to enter the market as a home buyer under these conditions takes careful thought, consideration, and planning. Timing is everything.
I often tell my clients; “You don’t make money when you sell a home, you make your money when you buy
The two key factors in this market from a buyer’s perspective are inventory/supply
and interest rates
There is so much to consider as a buyer when supply is low:
- Will you be paying more than necessary because there are fewer options available?
- Will I be forced to “settle” on a house I don’t love because there are less options available?
- If I hang around long enough, will more houses become available that I will eventually fall in love with?
- Will I end up paying more for a home because I end up in a bidding war against another buyer?
Regarding interest rates hovering at all-time lows for the 5th consecutive year:
- Are interest rates stable at the moment or will they begin to rapidly rise as the housing market and economy recover?
- Am I really in a financial or credit rating position to even take full advantage of these historically low interest rates?
None of these questions or considerations should be taken lightly. The best way to fully understand if you are in a position to fully take advantage of the low interest rates and the waning supply of available homes is to speak with a professional
real estate agent who knows and understands this market, the lending conditions, and the specific supply of homes available that meet your criteria.
The key to determining whether or not you have timed the market correctly is whether you bought “at the bottom” or whether or not you sold while conditions were optimal for you to maximize the combination of profit and time on the market.
Of course, these determinations may not be known until well after you have made the purchase or executed a successful sale of your home.
You may also consider the professional network of the agent you choose to speak with. While timing is critical in making the best decisions; a real estate agent that has the right professional network to aid in making the right decisions can
be critical to your success as a buyer or as a seller.
Here is the takeaway from all of this: now is the time to talk to a professional about how the current market conditions have affected your ability to sell your home as well as how the market has affected your ability to purchase a home and at a great price.
To be contacted about benefiting from my market and industry knowledge and the most effective and innovative marketing plan in Mid-Michigan please visit the following link and leave your contact information and I guarantee a Rapid Response®:
–Gotta Get Movin’