Here we are again at the most thankful time of the year! As I think about another holiday season coming up and consider changes in life, shake ups in the real estate market, and the general ups and downs of the day-to-day… I recall the 1989 film, Parenthood, with Steve Martin and a host of many of our ‘80’s favorites. If you haven’t seen it, you should. There is a scene where Martin’s character is feeling completely overwhelmed with the tumult of life with kids, wife, extended family; and "grandma" tells a story that is intended to help. She uses a metaphor that at first, appears to fly right over Martin’s head; describing the thrill of the "roller coaster" and how it is scary yet exhilarating at the same time; and yet, some prefer the "merry-go-round," which only goes around… As you look at life, which do you prefer?
Most of us, admittedly, enjoy the status quo. We prefer for things to go the way we want and/or expect. And yet, the reality is that we don’t always get to choose our "roller coaster" moments, and they often seem to just pop up on us at the most inconvenient times. But what if we had no ups and downs? How would we appreciate the "merry-go-round" seasons if we had no hills and valleys? How would we experience the victory of arriving on the other side of a challenge if our path was always level?
This year, I am thankful for the roller coaster. For all of the trials and triumphs we experience as we look to live out this short time on earth in a meaningful way. At the end of grandma’s story, Martin marvels at the supposed "wisdom" of grandma, as she is sitting in the neighbors’ car (ha!); to which his "unplanned pregnant" wife responds, "I happen to like the roller coaster." May we endeavor to embrace, and even find gratitude in, the roller coaster of life as we find resilience and a certain amount of exhilaration when we do. Have a Happy Thanksgiving and we will see you soon!
We have been getting a lot of questions around the shift that we see in our market, and many times the question becomes, "As I prepare to make a move in today’s real estate environment, how can I position myself to maximize the sale of my current property?" This is an excellent question, as the answer has certainly changed over the last year and especially over the last several months.
Home Prep? Yes. We are back to the days of seriously considering spending a few dollars to get many dollars in return. As you may notice, many listings are sitting on the market for 30 days or more right now. This is a great opportunity for buyers to negotiate a more opportunistic sale, of course. But it also causes us to marvel at the homes in all price points that are still "flying" off the market with multiple offers. What’s the difference? Home prep. And I am not just talking about a good clean up and some flowers on the front porch. This may include carpet replacement, professional painting rather than just touch up, staging that creates a "feel" that buyers want… basically, digging into the details where preparing a home for sale is concerned. This is not new; we just have not had to get so nitty gritty about home prep over the last several years. Therefore, sellers, and Realtors alike, have mostly forgotten how to truly maximize the sale of their properties.
This news may cause you to think… hmm… maybe I should just sell "as-is" to one of THOSE companies? This is certainly an option, if you are not concerned with maximizing the equity in your home and your plan does not require getting top dollar. For most of us, it hurts to give large chunks of money away when a tiny bit of concentrated work could net us a nice down payment for the next home. Of course, along with home prep comes deep-dive pricing analysis, deep-dive marketing strategy, and aggressive negotiation. We are experts in all of these, and we are happy to help make home prep as easy as it can possibly be, in order to get your money into your bank account. You need a team that is not taken aback by a market shift; a team who has solutions, not excuses. This is not our first rodeo! We have the experience and ability to make your move a success! Call/text/email, and let’s chat!
The question today is: What can cause a market to change from a seller’s market to a buyer’s market EVEN if we still have low inventory? Answer: Government intervention. Now, I am not here to get political... however, I recall the founder of our company, Gary Keller, discussing market shifts and the dynamics that surround them. What dynamics can we predicts and assess at any time in any given market? What dynamics will surprise us and are totally outside the realm of "the normal market tide?”
Predictable: Of course, we have the law of supply and demand, which assumes that if we have extremely low inventory, naturally, prices will rise and a seller’s market will prevail. Also, we can assume that as prices rise (and rise), some buyers will be relegated to the sidelines and unable to afford homeownership. We can also safely say that cyclical market dynamics such as these have been and always will be just that: cyclical. The tide rises and the tide falls.
(Somewhat) Unpredictable: Inflation reports that cause major disruption in the stock market which eventually makes its way into our local real estate market. And... Why? Of course, there are many factors. One factor: As the Fed raises the federal funds rate in an attempt to fight inflation, mortgage rates are often affected (whether directly or indirectly). Our market is experiencing an upward trend in mortgage rates, which restricts buyers’ purchase power and will likely lead to a multitude of changes in our local real estate market. We will get into some of those dynamics next month.
BUT! Don’t fear. We are staying on top if the market daily, and will remain your local specialist, even as we enter a time of changing tides in our market. No change is ALL bad (or ALL good, for that matter); it is all a matter of perspective and evaluation of your specific goals and needs. Let’s chat! I am happy to help you determine whether this market is the right market for you to make your move.
Everyone is wondering about the buyer situation, as we notice the market twisting and turning. So, are things getting better for buyers?
Although our local stats will not reveal the real "feel" of the market as we see prices still rising and inventory still at an all time low, yes, things are getting better for buyers. Active buyers, that is. You see, the rising prices and interest rates have edged many of our buyers out of the market, leaving fewer buyers for each listing. Rather than 20 offers on a particular listing, we may see 3-5 offers and sometimes only 1 offer! It’s true!
We recently wrote an offer for a client and we were the only offer and secured the property at the list price. Granted, this listing had previously been overpriced for the shifting market, and yet, because we were willing to be patient and wise about our approach, we got it with no hassle-and both buyer and seller are elated!
Buyer opportunity dynamics are in constant flux, but the bottom line remains: buyers have a great opportunity to buy with less stress this year than last. Sure, interest rates have creeped up, but they are still historically low. None of us thought we’d ever see 5% when I entered the market in 2002, and we have seen much lower than that! Interest rates are always in flux, so when there is an opportunity in our market, and you are looking to move… take it! Call to discuss. We are always happy to help!
The question that everyone is asking, as our interest rates rise: "Will prices come down? Have they come down already?" A loaded question, indeed! Well, the answer is, of course, "yes and no."
According to our local stats, pulled from Northstar MLS, June of 2022 records the median sales price to be just about equal to that of May 2022, which was up slightly from the month before. But what does median (or a average, for that matter) sales price across the whole Twin Cities tell us, really? Well, not much.
As a local professional, I always turn to a more micro-market approach when identifying trends in pricing, as real estate is what we would call, "hyper-local." One neighborhood may stay steady while others decline or even increase as interest rates change. Price ranges and property types will vary where these dynamics are concerned, as well. Have I noticed a decrease in price on specific property types in specific areas on specific days? Yes. Do I consider this to be the trend overall? Yes, no and maybe.
Often times, we find that prices continue to climb as interest rates begin to rise. Buyers who were formerly on the sidelines will often jump into the market to make their move before rates go any higher. Considering our inventory shortage, which is still very real, I do believe that though prices may ease in their rapid climb, we will still see them continuing to move upward in many of our micro-markets. Pricing is both an art and a science, and a deeper analysis of each unique situation is required now more than ever.
If you would like to know how your home will fare as you consider your upcoming move, give me a call and I can share a hyper-local perspective that takes into account all of the dynamics we are currently experiencing in our local market. I am always happy to help! -Angela
Many of our clients are calling to ask whether now is still a good time to sell and make the move they are planning. Most of them are aware of the subtle shift we have been experiencing in our local market due to the rising interest rate environment we have found ourselves in. Indeed, the craze has slowed a bit, as payment minded buyers realize they can afford quite a bit less than they could just a few months ago. So, what can sellers expect? And is this still a good time to sell? Here are a few things to consider:
1) Low inventory: Our data points still suggest that there is a shortage of homes for the number of buyers who want to buy. This means sellers are still selling quickly, though many may not see the "5-15 offers on the first day craze" that we have experienced over the past couple of years.
2) Rising interest rates: Most buyers are payment driven and that means that when the interest rates change, their mindset changes, as well. As they look at paying substantially more (monthly) for the same house they could have paid less for (monthly) just a few short months ago, many buyers pause and reconsider the urgency with which they will submit an offer. They will also begin to expect a more move-in ready product if they are going to pay the same prices that we have seen over the recent months.
3) Price adjustment?: The big ticket question is always, "will prices come down?" Historically we have seen prices increase as interest rates increase-at first. Slowly, the market adjusts to the interest rate environment, assuming rates continue to climb, and we see prices level out. We are in a unique situation currently, as we have massive a shortage of homes, while rates are rising. As some buyers get edged out of the market, we may see inventory increase, which will continue to shift pricing in the market.
The bottom line for sellers? If you will be making a move in the near future, we should get together and make a plan to prepare the house to shine in a market where buyers are getting picky, and inventory may begin to rise. You will want your house to be the best of the best in a shifting market, and I would be happy to help you to position your home to be a "YES!" to the buyer pool that is out there looking today. Call me and let's get started-the market is still amazing for sellers who are positioned to win!
How has life changed over the past 2 years? Well, our clients have let us know that their space needs have certainly changed, where their homes are concerned. How have your needs changed where YOUR home is concerned?
Many of our clients are looking for a home that better fits their family’s lifestyle as well as fitting their unique work situations. We are finding that many clients are loving a loft space on the upper level for gaming, toy areas or just a relaxing space that is out of the way of the main level “hustle and bustle.” Some of our clients are continuing to work part-time or full-time from home, which has necessitated a bit of a changeup, where their floorplan is concerned, as well. We are finding that an upper or lower-level office space is preferable, for many who have focus work to do, whereas a main level work station is great for quick catch up type work.
What are some of the changes you are noticing in your own lifestyle? Are there ways to adjust your spaces in your current home or might a move be on the horizon? Call me if you would like to discuss, and we can figure out a plan that makes sense for your lifestyle and overall needs!
As promised, we want to address your questions around the issue of low inventory; and we need to look at both seller and buyer considerations. As a seller, you have the opportunity to be in the driver's seat when low inventory markets arise. Most of our sellers, however, will also be buyers in the same "low inventory market." Let's talk about some things you might want to start thinking about, as you plan for your move.
These are just a few of the biggies, as we explore buyer considerations in a low inventory market. Do you have questions as you prepare to jump into this market? Call me, and let's chat about your unique situation and how we can position you to win the home you love!
Well, it’s that time of year again, when I start receiving calls from clients and friends who are intending to make a move this year. What do I do to prepare for a smooth move? How can I prepare my home to realize the greatest gain when I sell? How am I going to find my next home; what options are even out there right now? Never fear! I am here to help and my team is ready to help you in 2022! This month, we will discuss top tips for listing prep and we will get to your other questions over the next two newsletters (or you are welcome to give me a call to discuss, if you are anxious to get rolling!).
Top Tips for Prepping Your Home for Sale:
1) You know it… declutter! This is the least costly and most impactful improvement you can make. packing up items you don’t need right now (especially small knickknack items and antiques), putting away anything "extra," and removing extra furniture is a way to make your spaces look bigger and avoid distracting potential buyers.
2) Next… De-Home! Do your best to "de-home the home" by simplifying décor (think Pottery Barn). Take your personal style out as much as possible unless you have a very neutral style (again, think Pottery Barn). If you need help with artwork or rearranging ideas, just give me a call and we can work together to get you prepped and ready!
3) Super important… Call me and let’s do a preliminary listing conversation. I am happy to answer all of your questions and make sure that your listing process is simple, smooth and profitable. Don’t hesitate to reach out today and let’s get started.
We will chat next month about buying options and what the market outlook is for 2022. I guarantee you; if you decide to move, we will find a wonderful home for you and your family. In the meantime, let us know what you need when you need it; we are happy to help!
Wow! I think I say this every year, but WOW! I cannot believe we are on the precipice of another new year. As we enjoy the Christmas Season, our thoughts often turn to all of the things we have to do and all the presents we have to buy. But I wonder... maybe this year, we could allow our thoughts to turn to all of the people we care about?
As I open Christmas Greetings from family and friend and see posts and photos on social media with all of the people that are dear to me, I am hoping that this year I can take just a moment or two to consider the gift that those people are to me. I don't know about you, but for me, this requires a purposeful pause. As I look at this year's family photos (I love the "family photo Christmas Card", by the way!), I would like to pause, thank God for each one in those photos, and consider the ways they have contributed to my life.
I have much to be grateful for: A wonderful husband, the love of family and friends, amazing team members that I could not do this without, the BEST clients, prayerful ministry partners, and the Word that became flesh and dwelt among us. I could go on and on, but I won't. Suffice it to say, I am grateful everyday (even on my crabby days) and you are part of what I am grateful for.
This Christmas Season, my wish for you is that you would also purposefully pause... and consider those who mean the most to you. Spend a few minutes here and there (as you check off those to-do's) considering the people who bless your life. Merry Christmas and many blessings to you in the 2022!
Welcome to our blog. We hope to be able to provide you with some valuable resources about selling and buying a home in the Twin Cities. We may also include a favorite recipe of ours from time to time, so check back often.