WITH record prices being achieved and buyers swarming open houses like seagulls on a chip it’s safe to say the market is now firmly in good shape.
Many people may think that due to this competition the pressure is only on the buyers. But of course that isn’t true.
When you look at the three parties in most transactions you see buyers, sellers and the agents, all three will face pressure of some sort during a sale.
But for buyers the pressure is obvious. You see the number of people walking through inspections or the other paddles in the air at auctions.
Many buyers will be submitting offers with ‘multiple offer’ forms, which are documents that are signed when there is another buyer submitting an offer at the same time for the property.
The competition adds an organic wave of pressure, but because you can see it most buyers accept it.
In fact it is this visibility that gives confidence to buyers to buy and in many cases pay more. This is what drives the market forward. It gives weight to the expression “when the market is going up people feel like it will never stop going up and when it’s going down they feel like it will never stop going down’.
Both are wrong.
This obvious competition should also make it easy for sellers and agents. But what can now come into play are unrealistic expectations. Sellers who want more than the record prices on offer. They too feel that if they wait they will get more and maybe they will. But real estate is a now business. You can only get what you can get now. Buyers don’t pay today for tomorrow’s profits, that’s why they are buying today. If you wait and get more, likely you will pay more for your next place too. If you wait and get less, you will have to deal with that equation too.
For the agents it’s all about evidence of activity and market feedback. If an agent is not providing you with constant feedback, conducting regular inspections, generating activity on your property then any seller will likely question the validity of any offer as ‘the best in the market’. A fast market means agents must work even faster because in many cases the early offers are the best ones.
If they don’t have an owner’s trust they will likely reject the offers and regret that decision in the weeks and months ahead.
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