According to the real estate tracker, CoreLogic, San Diego County’s median home price reached $515,000 in March of this year…the highest it’s been in over a decade! It’s still below the peak we saw in 2005, but it is incredibly close. Real estate analysts state that the reason for these high prices can be directly correlated with the lack of homes available on the market. With fewer homes for sale, buyers are having to fight for every bit of real estate available.
A seller’s market is typically a really great thing for sellers. In a seller’s market, or “hot market,” there are more buyers hunting for properties than there are homes available on the market. That tight inventory and lack of availability is a big player in the rising home prices we are seeing here in San Diego County. Some months, we are seeing inventory as low as just two months! For reference, a 6-month inventory is considered a hot market. So compared to other markets, San Diego is blazing on fire. If you’re a homeowner and are interested in selling during this hot market, these things probably all sound amazing so far, right? And ultimately, YES, a seller’s market will mean a higher price paid for your home. It is absolutely an amazing time to sell in San Diego County, there is no doubt about that. But, you must price your home to sell. If you do this, it will sell. With that being said, not everything will be candy, unicorns and rainbows. Here are some things to look out for in a seller’s market in San Diego.
Don’t Get Burned By A Hot Real Estate Market
Here are some of the challenges that sellers can face when it comes to a hot market:
- Selling too fast? It doesn’t sound like a problem, but in fact it can be. When you list your house “For Sale” and then it is “Sold” far quicker than you anticipated, you may find yourself in a pickle when it comes to finding a place to move in to. This is especially difficult if your goal was to move into a new house you were aiming to buy, but that house hasn’t been found yet. So if you haven’t found your next house, your current home selling quickly can be tricky.
- Low appraisals? While your home may get offers above market or list price, buyers could potentially get scared away if they see a lower home appraisal than what they offered (this is common). In this case, you can try to get a second appraisal, or just hope that your buyer sticks through it without asking for any price reductions.
- Loose offers: With so many buyers in the same hunt, it’s not uncommon for people to place loose offers on homes sight unseen or before they do all of their due diligence. Inventory is so tight that people get desperate and start putting out offers without very much thought. This could end up meaning a lot of offers being terminated shortly after they are made, which is disappointing to an eager seller.
- 1031 Clock: If you’re looking to sell your investment property while the market is hot, we get it, but also be mindful of the clock that starts ticking to buy the replacement investment property. If you don’t find one within 45 days, you will have to pay taxes on the sale of your investment property.
- Too Optimistic: In a seller’s market, sellers can become overly confident in the price they should get for their home. Rather than looking at comps in their area, they list their home higher and expect that the market will support the listing price. Sometimes it does, and sometimes it doesn’t. In other cases, sellers receive strong offers in the beginning, but don’t accept because they are awaiting the “grand finale” of offers. If this doesn’t happen, then your home will sit, become stale, and the offer you end up with may not be as high as the first.
Reasons Why Your Home Isn’t Selling in A Seller’s Market
According to a recent real estate news article, here are some of the most common reasons why homes don’t sell in a seller’s market:
- You’re pricing the home too high (as mentioned above)
- Your home isn’t appealing to buyers (too dark or cluttered)
- Prospective buyers can’t get in to see it (restricted showing times)
- The photos of the home aren’t great (bad first impression)
- The home is dated, but your price doesn’t account for that
- The property can’t be insured (due to condition, making it difficult for buyers who can’t renovate it)
- Lenders aren’t approving financing (buyers are having a hard time qualifying for the home loan)
A Guarantee to Sell with Under Any Market Condition in San Diego
Some may say that there is absolutely no guarantee that your home will sell. And if we’re talking about when you list your home traditionally, that is 100% correct….there is NO guarantee. Even IF you’re in a seller’s market. But, you do have a guarantee to sell by selling directly to a cash buyer like us. It doesn’t matter what the condition of the home is, we won’t run into any trouble with financing or insurance because we will buy the house for cash and pay to fix any problems that would flag insurance. If this sounds like something you’d like to take advantage of while the market is hot, we’d be happy to provide you with a no-obligation cash offer.Views: 8