The more I look at the news, the less I see what is really happening in the real state market. No matter how you filter the sensationalistic headlines, you cannot help but wonder how much the news media affects the psyche of their readers. Write it enough, and people will believe, even if it is not true.
Case in point, the market started to slump a year ago and the effect were felt in November, or at least here in Long Beach, as I witnessed. For these three months a year ago, the news was continuing its merry round of reporting how great everything was. Finally, March of this year, I witnessed some news talking about a slow down. Then in May, even the ever-enthusiastic NAR and CAR started to admit a softening of the market… six months after.
The summer is always an interesting time of the year. August can rake in the sales or leave you flat out. This August was not great. I hear from many clients that they are waiting to see where it goes. My answer is that what if it goes up? No one can tell anyway and you, the buyers, make the prices ultimately. But with rumors, experts and the news media talking about the end of times in real estate has given a lot of people cold feet.
In the end, what I see is still very clear. Sellers who are sincere and earnest in selling their homes come to professional and listen to them. They go on the market at a slightly lower price and end up with a great price, sometimes with multiple offers. A rare case in our days. Those who think they know what price their homes should go for, often sit months on end on the market, gathering up a negative image to finally have that fateful sign: "Price Reduced" and attracting bargaining sharks. This against the better judgment of their agents telling them to price it lower.
Let’s not talk about For Sales By Owners (FSBO), the numbers speak for themselves. Close to all FSBO take months, attract bargainers who want to cut the commission even deeper and ultimately sale for lower than an agent would, and take more time. Close to all cases, the money saved in commission was outweighed by the "bargain" price of the buyer by 15% to save a 6% commission. Hardly worth it.
Ironically, rith now is probably one of the best market where buyers and sellers stand on equal footing with enough leverage on both sides. I see buyers snapping up the right property at the right price because they can leverage. Wait too long and the balance might shift again.
All in all, we are returning to a normal market, despite what most news say. What we lived through the last few years was an abnormal appreciating market. Here’s to returning to a healthy one again.
