Hot market cooling off? Whatchu talkin bout, Willis?
Cast your mind back…
Picture it—Late summer. The last gasps of a Midwestern August. A mall just outside of Chicago. The anticipation was almost more than I could handle. My mom, my older sister, and I had spent the night in a hotel so we could get there early. Given our lifestyle at the time, this was a pretty big deal.
Now, finally, walking into the biggest mall I’d ever seen, it was about to happen. All the waiting was over and my one desire was within my grasp. I was finally going to own my first pair of parachute pants.
I was 100% certain that these pants would define my wardrobe and be a staple for life. I was 101% certain that pants this cool would never…could never, ever go out of style. Ah, the shattered dreams of childhood. Growing up sucks sometimes.
Why am I daydreaming about the most extraordinary fashion movement since the beret?
Because my devastating lesson about the fickle nature of trends serves as a cautionary tale.
For months in early 2020, sellers came to me in a frenzy. They were worried that this hot market was going to end before they could get their home out there. They were worried about missing out on the greatest seller party since Herbie Hancock opened for Prince.
High demand and record-low supply created a perfect storm for the housing market. Just like bread before a blizzard, panic buying set in and the real estate shelves were bare. Homebuyers were left scrambling and the seller party was at full rave status.
As with all cycles, this market won’t and can’t last forever. It’s simply not sustainable and some people are starting to realize this. Buyers are getting savvier (see my last post) and as night follows day, sellers are starting to “expect” certain things. Never a good sign. Seriously… don’t be that guy.
Over the past few weeks, I’ve noticed sellers building their entire weekend around the prospect of a few days of showings, one or two open houses, and instant multiple offers. Friends, when you push your expectations this high, you’re setting yourself up for “Caddyshack 2” level disappointment.
When sellers are 101% certain that they will have buyers fighting over their home and they purposely priced it high expecting offers to be higher, that tells me we are nearing the end. That’s right—the beer is running low and the only snacks left are the stupid rice cakes. Who brought those, anyway??
The point is that when buyers are already backed into a corner, forced to pay record-high prices for homes, pushing even further is going to cause them to seek alternatives. We are seeing a huge wave of buyers electing to wait it out, rent, build—anything but buying an existing home.
I have some advice for anyone getting ready to sell your property:
If you want the party to keep going, do not piss off the market. When the market sees someone trying to manipulate or take unfair advantage of the situation, well…let’s just say I pity the fool for the punishment they are about to endure. No showings. No offers. No big bucks–just whammy’s. (You might have to Google that one.)
Don’t get me wrong—the market is still very hot and there are a lot of buyers still desperate to find their next place. You can still generate multiple offers and get top market value for your property. You just need to avoid the arrogance trap and keep your expectations somewhere near reality.
If you price it right and market correctly, you will have the proverbial line of buyers and a very successful sale. We are still seeing plenty of properties pulling in multiple offers with escalations.
Just keep in mind my #1 law: The market never lies—not ever. One parallel law I may need to add is that the market will not let anyone else lie either.
The same success formula still holds true:
- Prep the home so it’s ready to sell
- Price it slightly below the current market price
- Use our “Shock and Awe” method of marketing
- Negotiate like Reagan ending the Cold War.
The only thing you’ll need to worry about? What to wear to the after-party. Might I make a suggestion…
If you agree, let me hear it. Tell me your stories and tell me what worked and what didn’t work for you.
If you disagree, come at me like Hulk Hogan with your reasons and logic. Don’t worry—I don’t bite and as you may have guessed, I love a good argument and I always keep plenty of Grey Poupon handy for unexpected visitors. Hit me up HERE with your thoughts and comments. I read and respond to every email…eventually.
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