Friday, August 12, 2005

Need to Sell Before The End Of Year?

The best way to find out what is happening in the Real Estate market is to talk with agents not read headlines in the Daily Breeze or LA Times or even the WSJ. Real Estate is local and local agents know the market.
While some properties are still "hot" and selling fast a lot of inventory is sitting. Many of these wallflowers are just priced too high and the marketplace doesn't see value in them at their current price. Picking the right price in this market is tricky. Sellers and buyers don't always have the same value perception. A shade too high and no one loves you. We are seeing an increase in inventory in the last month. As inventory increases buyers will be more selective in their property choices. In our area buyers have the funds and financial stability to purchase. If they are stepping back it is because they feel the prices are too high and they will not buy until prices reach an acceptable level. A good example is condo/townhome sales in Hermosa Beach and Manhattan Beach. This market was so hot a few months ago that nothing stayed on the market beyond a few days. Prices shot up and now there is lots of inventory. I know a property that sold last month(July) and is back on the market for $120,000 more then it sold for two weeks ago. I suspect this one will be around for some time. Other sub-markets are reflecting the same conditions.
So what does this mean to a seller? You can't just throw a price out there and think buyers will step up and pay anything for a home. They won't and aren't.. We saw the same phenomena about this time last year and prices actually dropped about 10% by the end of the year. Too often sellers think that if they "lower" their asking price they are getting less then it is worth. No so, you are just pricing the property where it should be not where you were hoping it might be. If your property has been on the market longer then 30 days and no one is looking or writing offers then it is overpriced. If you need to sell by the end of the year it may be time to realistically price your property.
Real Estate is highly competitve which is why prices rise when the consumer sees the value to be appropriate and lags when good value is not perceived.

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