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The definition of confusion is waitstaff serving my Mother. One might as well order in Mandarin. It kind of goes like this. “What is the Salmon cooked in? Is it saucy? Is the sauce creamy or heavy? Is there spice to it? Hmmm, I’ll just have the Salmon but want it cooked in Pam. Plain No oil or butter. I’ll have the broccoli side. No make that the asparagus side but just steamed. Do they salt it? I don’t want salt. Oh, can I do a baked potato? Can you butterfly it on the grill? No butter, no sour cream no chives. No salt. Wait, can you change that to just steamed and forget the butterfly grilled.” Then Mom calls the waiter back and changes everything to a just lettuce with Salmon on it but grill the Salmon and the dressing on the side with but back to the potato butterfly grilled and with some BBQ sauce on the side.
That is basically how the buyer, seller, and Realtor are approaching the real estate market right now. This week I was on CBS 12 talking about this confusion. Watch the CBS 12 Interview on State of Real Estate Market.
What does the new housing shift mean for locals? When are good buys available? When do I go up in price and when should I stick to the original price? What is going to happen to mortgage rates and home prices? I’ll unpack everything for you (hint – it depends) and you don’t even have to tip me like the poor waiter or waitress serving my Mom (sorry Mom!)
For the most part it’s a sellers’ market and especially for remodeled homes, homes with good lot locations, and those with good floor plans. Bidding wars and speed are still critical if hard to find or you are in a need situation. On the flip side, there is now opportunity for a buyer. Higher rates, no more stimulus, inflation, snowbirds not staying for the summer have all brought more normalcy to the marketplace. A buyer can stand their ground and have much more negotiation power in certain situations. It’s not all black and white and up up up like before…. although sometimes it is.
As a rule of thumb, a house hunter should increase their budget when the property is hot, it’s a low inventory situation, or if you are in a need situation and can’t afford to lose.
Stick to your price when replacement inventory is available, if you are not rushed on time, and when overpriced
However, I don’t see it turning into a full buyer’s party because supply has flattened since the pioneer stage of our local market is over, and there is no land for new product available east of the turnpike and 95. The demand and population of new buyers moving here because of our 0% tax base, weather, lifestyle and large base of relatives, friends, job opportunities far exceeds supply. Supply problems have also hampered new construction from replacing the shortage of “shelter” needed throughout the country. There are also lots of replacement buyers in play. Buyers who would rather stay local instead of moving out of county/state and Millennials and younger generations waiting in the wings if prices drop.
Furthermore, there wasn’t wild investments like in 2005 and bad loans. The market evening out is very healthy. Prices should go up with the rate of inflation and in some cases more. There are also new incentives for essential workers, which I’ll get into next week.
What this means is it’s very back to basics for Sellers. Staging, lots of marketing, and not flippantly responding to offers and repair requests are important. If a mortgage is involved, preapprovals need to be updated weekly at minimum because what one can afford or qualify for can change overnight. Strategy is much more nuanced in this market.
It’s far more important to have an aggressive and Guaranteed marketing plan in writing if you are selling and hire an agent who has been in different markets and has lots of strategies up their sleeve.
Mom- are we still in on for our shopping date at the mall ?!?
Jeff Lichtenstein is owner and broker of Echo Fine Properties, a luxury real estate brokerage selling real estate in Jupiter and homes in Palm Beach Gardens, Florida. He has 20 years of real estate experience, has closed over 1,000 transactions, and manages over 70 agents in a non-traditional model of real estate that mimics a traditional business model. Some publications he has been quoted in.
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