In today’s highly competitive seller’s market where there are more buyers than there are listings for them to purchase, some sellers may feel like the ball is in their court.
And they would be right when it comes to choosing which offer to accept, the closing date, or even which improvements the seller is willing to make to the home prior to selling.
One thing to remember though is that there is always a line that shouldn’t be crossed.
Interest rates could change, financing might not go through, the appraisal might not come back at the price that you have agreed to. These are all opportunities to work with your buyer to make sure that the sale still happens.
You may think that because buyer demand is high right now, that you could choose to make your buyer jump through hoops. But what happens if they reach their limit and need to walk away? You’re starting over… weeks, maybe months later… and other buyers may wonder what’s wrong with the house that the deal fell through.
The Golden Rule
We were all taught from a young age to “treat others as you would like to be treated”. This shouldn’t change once you have a buyer who seems as though they would do anything to buy your home.
With home prices expected to appreciate by over 5% this year, some are beginning to worry about a new housing bubble forming. Warren Buffet addressed this issue last week in an article by Fortune Magazine. He simply explained:
“I don’t see a nationwide bubble in real estate right now at all.”
Later, when questioned whether real estate and/or mortgaging could present the same challenges for the economy as they did in 2008, Buffet said:
“I don’t think we will have a repeat of that.”
What factors are driving home prices up?
It is easily explained by the theory of supply and demand. There is a lack of housing inventory for sale while demand for that inventory is very strong. According to a recent survey of agents by the National Association of Realtors (NAR), buyer traffic was seen as either “strong” or “very strong” in 44 of the 50 states (the exceptions being: Alaska, Wyoming, North Dakota, West Virginia, Connecticut and Delaware).
Also, in NAR’s latest Pending Home Sales Report, it was revealed that the index was the highest it has been in a year.
What does the future bring?
As prices rise, more families will have increased equity in their homes which will enable them to put their home on the market. As more listings come to market, price increases should slow to more normal levels.
Anand Nallathambi, President & CEO of CoreLogic, recently addressed the issue:
“Home price gains have clearly been a driving force in building positive equity for homeowners. Longer term, we anticipate a better balance of supply and demand in many markets which will help sustain healthy & affordable home values into the future.”