March 7th, 2013 12:08 PM by Taydus Taydus, AHWD, CNE, CRS, GRI
We are seeing the market change here locally - a lack of inventory and high buyer demand is driving home prices up!
This is GREAT news if you are considering listing and selling your home, however here is a tip to keep in mind when trying to determine a realistic list price for your home:
Don't get greedy! It doesn't not always pay off in the long run. Because of demand you may think that pricing your home $50,000 over the highest comparable property in the area is fabulous when you get that full-price offer, but remember chances are your buyer will still need to qualify for a home loan. This means that your home will need to appraise...and appraisals are based on recent comps. With home prices climbing with the demand, we are still on the edge of increasing market values. That said, you may be the first to sell a home of your size and condition, in your area, for and increased market price so there may not be many (or any) comps to support the price. That means if you get greedy on the price, your home may not appraise and your home sale could fall apart when a potential buyer is unable to secure financing. Talk to your Realtor, go over the comps together when you are trying to determine the best list price for your home, and rely on your Realtor's expertise (remember they want to see your home sell for the highest price as well!)
Being realistic and working with a Realtor that is familiar with the local market will make all the difference, and it will help insure that your home is priced right for the current market conditions.
In a recent online article it said: "National home prices in January were up 9.7 percent from a year ago, the biggest annual increase since April 2006...read more.
Buyers just because the market is increasing does not mean that you should wait to buy. Interest rates are still low (but are slowing inching up!) and why not buy now and take advantage of the home values increasing, thus increasing the value of your new home!
However this lack of inventory DOES mean that you need to be ready to submit a strong offer with a strong prequalifcation letter when you find the right house. We are seeing multiple offers on homes in desirable locations. Fence sitting will cost you the home of your desire in today's market.