In the midst of the pandemic and beyond, selling a home was a smooth ride for many homeowners. In popular neighborhoods, potential purchasers lined up to visit open houses, and bidding wars, along with escalator clauses in contracts, were commonplace.
But longtime realty company owners are forecasting a change for 2024 housing markets. They’re sounding cautionary notes -- especially for owners contemplating a near-term sale.
“I think we’re in a period of unknowns, both for our economy and lifestyles. It’s a time of pessimism, and pessimists aren’t excited to buy a home. I foresee a tougher market for sellers,” says Fred Meyer, a real estate broker and appraiser who’s sold property near Harvard University for more than two decades.
Joan McLellan Tayler, who long owned a realty firm in a wealthy San Francisco suburb, is equally concerned about the dispirited mood of homebuyers.
“Malaise is the word I would use to describe the prevailing mood,” Tayler says.
Of course, homeowners intent on selling in 2024 also have several positives going for them. One factor is that numerous members of the millennial generation have yet to buy their first property. Moreover, there remains an overall shortage of listings in coveted communities.
“Home sellers have done well as prices continue to rise year-over-year,” says Lawrence Yun, chief economist for the National Association of Realtors (nar.realtor).
Even so, real estate pros caution sellers against hubris -- especially when it comes to pricing a property.
“Sellers who get haughty get punished. It’s an old story, and one that’s true in all sorts of markets. A shortage of inventory won’t bail you out if you’re greedy. These days, buyers are too smart to overpay,” Tayler says.
Here are a few pointers for 2024 home sellers:
-- Make sure your bidders are financially qualified.
Smart sellers are careful to check the financial standing of would-be purchasers.
“Who wants a deal to fall through because the buyers lack the wherewithal or credit to get it to the finish line?” says Eric Tyson, a personal finance expert and co-author of “House Selling for Dummies.”
Before accepting an offer, sellers should insist on seeing a genuine preapproval letter from a known lender, Tyson says. This should establish that the buyers have had their credit checked, their employment confirmed and their assets verified.
In addition, prospects can be asked to supply other details about their creditworthiness, such as their credit scores. The most common of these, known as FICO scores, range from 300 to 850. The higher that number, the more likely are borrowers to get the loan they need to close the deal.
“To avoid sleepless nights, look for buyers with scores of 700 or above,” Tyson says.
Bidders can obtain reports on their credit scores at myfico.com, a website of the Fair Isaac Corp.
-- Pick an experienced agent for your listing.
Tayler says too many sellers take a casual approach to choosing an agent -- noting that some make the mistake of hiring a relative, a friend or a young agent looking to get started.
“Many sellers fail to understand that no matter the strength of the market, it takes complex skills to do a great job selling real estate,” she says.
Tayler recommends that sellers opt for an agent with experience in handling lots of different deals. Those with a track record are most apt to sniff out problems before they happen.
“It’s foolish to hire a listing agent who lacks a fundamental grasp of the business or doesn’t know the local turf,” Tayler says.
If, for personal reasons, you’re determined to choose a newcomer, she suggests you ask that agent to share the listing with an established pro from the same office.
-- Look into issues that could arise during an inspection of your home.
These days, many purchasers exercise their right to a home inspection. And many use the process as leverage to renegotiate the deal.
Owners should never try to talk buyers out of a home inspection. But smart sellers will consider paying for their own inspection even before the property goes on the market.
“The person you hire for a presale inspection is unlikely to find all the same small problems that the buyer’s inspector will locate. But both should spot the really major problems,” Tyson says.
“Knowing the problems that lurk in your house is especially important if the place is more than 10 years old,” he says.
-- Try to avoid troublesome buyers.
Not all home sellers can be choosy about the offer they select. But if you’re reasonably certain you’ll have more than one bid from which to pick, Tyson says you should seek to avoid cutting a deal with difficult people.
You may not have any direct dealings with your prospective bidders. But your listing agent or others might observe them when they visit your place. And their behavior can be very telling.
One telltale sign of difficult people is that they often make negative remarks when visiting a property. Though you’re likely to not be present for showings, your listing agent should learn of these unpleasant comments and pass them on to you.
By avoiding such prospects, you could spare yourself a lot of grief.
“If you’re lucky enough to get multiple bids, you can be pickier about the buyers you choose. If possible, resist troublesome folks who might nickel-and-dime you all the way to closing,” Tyson says.
(To contact Ellen James Martin, email her at email@example.com.)