Buckle Up…
The last 4 weeks has brought what we might look back on as the steepest, most aggressive influx of new buyers in the market in the history of our city. With interest rates holding strong at historic lows, and out-of-state buyers entering our market with bull-ish confidence, we are poised for the strongest Spring market we have ever seen--hard to believe in the wake of the last few years. You would think this is a broken record...but it’s not, the record is just speeding up through the electric surge of low interest rates, and an exodus of transplants out of states like California, New York, and Illinois.
SELLERS should be prepared to enter the market with great confidence, but should avoid the idea that preparing their property to list should take LESS work, when, in fact, the opposite is true. Because the out-of-state buyer market is so strong, online media is more important than ever. Quality brokers will continue to advise that sellers stage properties (literally,, and virtually), execute high-end digital marketing, and have a plan in place BEFORE-HAND for the event of multiple offers. Earnest money and appraisal contingencies will be the talk of this Spring market, but more on that in a minute.
BUYERS should be prepared to enter the market eagerly to capture the low interest rates and ride the upward wave of the market. Buyers should beware that in the early spring market many listings will be priced based on “comps” from November/December and the rapid rise of new buyers entering the market (even in the last 30 days) means purchase prices will rise above what will be justifiable looking at a comparative market analysis from the past 90 days. Don’t trust the sticker price...that home you’re standing in is likely going to sell for more than it is marketed for. Meaning, it is WORTH more than what it is being marketed for. That means we will likely see many appraisers struggle to justify these aggressive purchase prices. Quality listing agents will anticipate this and prepare their sellers to seek a contract with no appraisal contingency to avoid this risk of needing to re-negotiate a deal 15 days into a contract. Above all, ASSURANCE is what sellers are looking for. Coinciding with this, sellers will likely look for buyers to have skin in the game from the moment of contract and not be tied down with buyer-favored contingencies, such as inspections. As a buyer, if you are willing to pay $20,000 above the List Price on a property, but aren’t willing to have your earnest money (at least, a portion thereof) be non-refundable at the moment of an accepted, binding contract, sellers might be wary of your viability to make it to closing day if you have an inspection contingency--even a shorter-than-average period for inspections. Show sellers you are serious. This will help you stand-out amid a flood of offers, and STANDING OUT is what is going to matter in this market.
Buckle up...this year is just getting started. We are already executing these strategies for our clients with great success. Nashville is Strong.
Don’t get distracted, get focused.
Don’t be a victim, be a player.
Get off the bench, and onto the field.
