| Market
conditions will affect virtually every aspect of your purchase or
sale, including availability, price, and negotiating leverage. It's
always a good idea to research the status of the market when planning
a move. |
| |
Keep
Your Head
Don't get overly discouraged if market conditions seem stacked
against you. Conditions are rarely as extreme as they are often
made to seem by the media. Homes sell during busts and can sit
on the market during booms, so make sure your decisions are
based on reason and judgment and not on fear or excitement.
|
|
|
|
Evaluating
Real Estate Markets
Real estate markets are extremely cyclical,
and pricing and demand are highly influenced by interest rates and economic
conditions. Flexible buyers and sellers can often do very well by timing
their entry into the market.
Choose a Weak or Strong Market?
Most people who sell a home also have one to buy. Thus, except for those
palnning to rent it can be difficult to choose the optimum time to sell.
It's important to consider all aspects of the transaction - the homes
being bought and sold, interest rates, time pressure, etc. - to determine
what is best for you.
When is a Weak Market Best?
Generally, it is advisable to act during a weaker market when moving up
- purchasing a more expensive home - since a bargain on an expensive new
home will offset losses on the old one.
When is a Strong Market Best?
If you are downsizing - moving to a smaller home - you may want to act
during a strong market to maximize gains on your larger current home.
Retirees and empty nesters are primary members of this group. Since a
home is a major asset, choosing the right time to sell and buy a smaller
property can have a major impact on retirement savings.
Signs of a Weak Market
A weak market is characterized by large numbers of homes on the market
and stable or declining prices. During weak periods homes tend to sit
on the market for fairly long periods, and sellers may have difficulty
finding buyers. While it's obviously not an ideal time to be selling,
there are a few things you can do to cope
with a slow market.
Signs of a Strong Market
A strong market is characterized by appreciating prices, tight inventories,
and short selling times. Sellers may find a buyer quickly - and at a high
price. A strong market is a seller's dream, so consider these tips for
maximizing
the benefits.
Signs of an Overheated Market
Overheated markets are characterized by rapidly increasing prices, extremely
low levels of inventory, and bidding wars for attractive properties. While
obviously an ideal time to sell a home, sellers should act quickly in
this environment - prices almost always contact sharply when the economy
falters.
Market Lag
Popular
perceptions and pricing often lag behind the actual turn of a market.
For example, prices are often slow to react to the onset of adverse economic
conditions, as sellers and agents are reluctant to accept the change until
properties have languished on the market long enough to force price reductions.
|
