The housing market is playing out a lot like a come back game for the underdogs.
Home sales were down in 26 metropolitan areas during the second quarter this year, compared to only 16 metros losing ground in prices during the first quarter, according to the National Association of Realtors.
The second quarter median condo price, measured in 57 metropolitan markets, was down 0.3 percent from a year earlier as 14 markets revealed price declines. Only five condo markets came in with price declines in the first quarter.
Speculators are rolling up their tents in once super-hot markets, investors are moving money to emerging markets and some potential first-time buyers, thwarted by higher energy costs, are opting for the rental market.
For the first in more than two years, the median condo price in metropolitan statistical areas (MSAs) is less than the median single-family price in metro areas.
That's a quantum shift in previous pricing anomaly that was caused by a concentration of condos in metro areas.
In a growing number of housing markets, selling a home is no longer a slam-dunk proposition. If you want to hear the net go 'swish' on your home sale, you'd better have some new moves.
Otherwise buyers will shut down your game.
"After half a decade of unprecedented growth in the housing market, it looks like home buyers are finally holding the cards as we move into a buyer's market," said Holly Slaughter, consumer experience expert at RealEstate.com.
Slaughter contacted us with a new game plan for sellers and we brought in some real estate agents from around the nation to help her coach.
If sellers want to stay in the game, here's what they'll have to do.
- Don't foul out. Price it right. Truly competitive prices that reflect market conditions are game winners. Slaughter suggests getting an appraisal to help set the asking price.
"The most important thing is pricing your property correctly. This can be done by contacting your real estate agent and having them perform a Comparative Market Analysis (CMA) for homes in your area that have sold or those that are on the market that are similar to the home that you are selling. A home that is priced too high for an area will not see a strong flow of interested buyers. Pricing your home too low may make buyers wonder if there are problems with the property," said, Brandon Green, owner and president of 40 Acres Realty Investments in Houston.
- Respect your opponent. Treat every consumer and every agent as if they were the person willing to pay the highest price for the property.
"Realize that in a declining market, a low offer today is likely to be a high offer in 60 days so give careful consideration to any offer even if less than you expected," said Richard Calhoun, San Jose-based Creekside Realty's broker.
- Give up some free throws. Negotiate with concessions and incentives.
"From a paint and carpet allowance to a new plasma TV. Creative extras may cost you a little up front, but are a great way to sweeten the deal," said Slaughter.
The market may be slowing, but home prices aren't cheap and buyers are cash-strapped.
"Pricing in New England is running about the same or just under it was a year ago, and settlement is coming in between 2 percent to 5 percent below asking. Sellers are offering to pay the property taxes for a year as an inducement to a buyer. Or giving free gasoline for a year. We have seen one developer offer a new BMW in the garage of any new house sold during a particular period. Some sellers are offering to pay the mortgage for the first year or two," said Dane Hahn, owner of EXIT 11 Real Estate, in Stratham, NH.
- Razzle, dazzle them with some new moves. Curb appeal enhances first impressions. Removing clutter sends impressions into overtime. Likewise, staging the game can put points on the board.
"Sellers in a changing market should consider the power of having a professional stage their home. If they are wary of being charged for these services, even just having a savvy real estate agent walk through and around the home and give suggestions on how the home could look better to potential buyers is huge," said Marcie Hahn, a real estate agent and Dane Hahn's daughter, at Williams Realty, in Salt Lake City.
"Many times the sellers don't see their home as others do because it's just that ... their home ... fresh eyes can be very powerful," she added.
- Shoot! Because so many consumers browse for housing, post plenty of high-quality photos of your home's interior and exterior online.
"Print out a nice report of your home. Add plenty of pictures, a detailed list of the home's amenities, a list of local amenities, third party information on schools, etc. Leave a couple of bottles of water for them to take (from the open house) as well," said Slaughter.
- Bring in an assistant coach. Hire an inspector.
"A large number of home sales fall apart after the inspection. Hire a professional to inspect your house from roof to basement before you put it on the market, giving you plenty of time to make repairs or price accordingly," said Slaughter.
- Know your way around the court. Know your neighborhood.
"Part of my listing presentation focuses on current market conditions. I educate them on the importance of competitive price, the average days-on-market in their area, and I make suggestions on the presentation of their home for potential buyers," said Shawneequa Badger, a real estate agent with Century 21-Alpha in San Jose.
- Sit on the bench. Most buyers want to feel comfortable when they're considering buying your home. Hanging around during the open house may run off potential buyers.
- Bring in some trick plays.
"I also suggest holding open house throughout the week instead of just the weekends. There is nothing better that will capture buyer's attention when you are the only open house in the area," said Badger.
