During the worst of the COVID-19 pandemic, a couple of retired federal employees living in a ritzy suburb pondered the sale of their big Dutch Colonial. But the hassles of showing their property convinced them to postpone until this month.
Now, they regret the delay. In recent days, the once-frenzied selling market in their hamlet has slowed considerably. Indeed, 22 days into their listing, they’ve yet to receive their first offer.
Ivy Zelman, a Wall Street housing analyst, doesn’t know the couple in this true story. But she’s not surprised by the change in selling conditions in their community.
“I think the housing market is starting to show some moderation,“ says Zelman, author of the new book “Gimme Shelter.”
As home values continue to rise, she contends an increasing number of young families are so saddled with student loan expenses and child-care costs that they’re approaching a pricing ceiling.
“The continual upward pressure on home prices, which is not sustainable, is impacting affordability. We’re starting to see resistance by consumers who are not only questioning whether they can afford a house, but also whether they really want to buy at the top of the market,” she says.
Zelman isn’t predicting an immediate end to the strong seller’s market or even a slowing in home value increases. Available properties, especially starter homes, are still in short supply relative to demand. But going forward, that could change due to demographic factors, which could eventually lead to a reversal in the supply-demand ratio.
“Overall population and household growth is slowest since the 1930s,” she says.
Real estate specialists aren’t advising owners considering a property sale to alter their plans because of the macroeconomic forecasts. But they encourage those who are absolutely certain they want to move to be attentive to timing.
“As with any business transaction, timing can be critical when it comes to the sale of a property,” says Sid Davis, a veteran real estate broker and author of “A Survival Guide to Selling a Home.”
Here are a few pointers for sellers:
-- Don’t delay engaging the services of a listing agent.
When Davis first entered the real estate field several decades ago, he recalls how clients would typically call for help at least three months before they planned to move. Now, he says many wait until just a few weeks before they intend to sell.
Once you know you’re definitely going to sell, Davis says it’s prudent to begin interviewing prospective listing agents and then to promptly select the one you want to represent you.
“There are many advantages to picking your agent early, even if you do so a year before you intend to move,” Davis says.
An agent with ample notice of your selling plans can better determine the steps you should take to achieve the best possible outcome. The agent can also exercise more care in selecting the right listing date.
“Especially now with supply chain problems, arranging for contractors on a non-emergency basis can save you cash,” Davis says.
-- Investigate data on selling times.
Dorcas Helfant, a former president of the National Association of Realtors, recommends you ask your agent to give you statistics on average selling times for homes in your community.
“The only numbers that count are the ones for your immediate neighborhood. Beyond that, the statistics aren’t relevant,” Helfant says.
-- Pack your belongings promptly.
Besides painting and repairs, nearly all homes need a thorough decluttering to show well. Your first step should be to remove any excess furnishings that crowd your interior space. Then box up smaller items and place them in your garage or a rented storage unit.
“By beginning as early as possible to clear out clothes, furniture and other items that you rarely use, you enhance your chances of fully completing this task before your place goes up for sale. Trust me, you won’t miss all that stuff, even if it’s stored away for months,” Davis says.
-- Give yourself extra selling time when moving to a brand-new home.
These days it’s very rare -- but still possible -- for homebuilders to agree to a sales contract with a prospective buyer that’s conditional on the sale of the buyer’s property. This is called a “contingent contract.”
“A contract conditional on the sale of your present property may not obligate you to go through with the purchase. But if you can’t sell your house on time, you could lose the new property and your deposits could also go down the drain,” he notes.
Because it can take months to construct a new home -- and it’s not unusual for builders to take longer than they expect -- some new home buyers wait longer than they should before trying to sell their current property.
“But remember, this is a one-way street. The builder can be late, but you can’t, or you’ll be thrown in a risky situation financially,” Davis says.
Many real estate agents urge their home-selling clients to allow them extra marketing time when they’re buying a brand-new property with a contingent contract.
“People are scared they’ll be left homeless if they sell the old house before the new one is ready. But if this happens, the worst-case scenario is that they’ll have to move in with relatives or take a short-term rental. Either of those options is better than missing out on your dream house,” Davis says.
(To contact Ellen James Martin, email her at email@example.com.)