“Luck Is What Happens When Preparation Meets Opportunity” This quote, by Roman philosopher Seneca, reminds us that we make our own luck. Selling Houses in any market is no different if you and your house are prepared for the moment, selling a house in Sacramento should be relatively easy.
Over the past 4 years home values have risen dramatically leaving most homeowners with more equity than most people imagined possible. For the most part that is a good thing, as sellers can look to the future and know that they can parlay that equity from one house to the next.
The question that I’d have for most homeowners though is… are you and your house up to the task? Sellers market or not, the most common mistake people make is thinking that no matter what the condition of their house, the buyers are going to come in droves competing for their houses. It is just not true.
While a sellers market can provide the advantage to the seller, there’s more to it than just having a house for sale within a housing market that has a limited supply. Advantages are not guarantees and if you are serious about selling your house fast in Sacramento, it means exploiting that advantage and targeting the right buyers.
Since the great recession just 11 years ago, buyers have changed their habits, in large part due to the new lending rules and regulations that are not allowing first time buyers, with conventional loans or other wise to buy fixer uppers. Today’s lending standards only allow houses that pass livability standards and if your buyers are seeking funding from government backed loans like FHA or VA, the rules are even more stringent. It doesn’t matter that you have found the one buyer that wants a fixer upper, if they need a loan, the lender is calling the shots and your house is most likely off limits and may not qualify for the loan.
What is a Seller to Do?
Homeowners, today more than ever, need to start looking at their homes in a different light. I am not saying that houses cannot be sold with defects that buyers will have to deal with, but the notion that you can sell your house that needs a lot of work to just anyone especially if it requires financing is not a reality. The truth is if your house needs more than just a little bit of work and you want to sell it fast, stop marketing your house to the wrong buyers. You need cash home buyers in Sacramento, Stockton and Modesto. The Sell My House Fast in Sacramento ideal is a great objective, but call the right people.
Pretty houses, ugly houses the principles are all the same. Whether its a buyers market or a sellers market, selling a house is all about marketing, the targeting and the pricing. In order to sell your house fast in Sacramento you need to be realistic about your house, its location, its age and its condition. Those are the drivers and if your house is not selling, something is wrong with either one or all three.
Even the ugliest of houses have value. If marketed and priced properly, they receive offers as well. Sometimes even multiple offers. But, if your house has a collapsing front porch, fire damage to the garage and flooding to the kitchen and you are marketing it conventionally to buyers that want move in ready your house will just sit. There is no way that you can successfully market the house as “Move in Ready with an Opportunity for Improvements.” It isn’t going to attract any one. Likewise, you can’t price the same house at top of market value and expect any offers to roll in.
Targeting means that you need to advertise in the places that will attract buyers for your House. Here is the perfect analogy. If you want to sell your car, you are not going to advertise it in the real estate section of craigslist. That would be like putting a for sale sign on the windshield and closing the garage door. Who is going to see it?
All I am saying is that special needs houses need special needs marketing. Cash Buyer do not comb through the MLS looking for bargains anmore. The Market has changed and so have the Buyers habits.
Home Buyers Have Changed:
Lenders are driving much of the market now and with prices hitting record highs buyers are demanding move in ready with as many of the amenities as they can afford. As a result, I think it’s fair to say that the homebuying landscape in Sacramento has changed and that buyers today are looking for move in ready. I have written about this before. 98% of all buyers are going to order at least one and as many as 5 home inspections.
- Wood Destroying Pest (Termite)
- General Home Inspection
- Roof Inspection
- Mechanical Inspection (Electrical, HVAC and Plumbing)
- Structural Inspection (Foundation and Subfloor)
Buying houses is not very complicated, but in today’s market, the buyers are demanding that you fix everything before they will close. Even if sellers agree, there is still a chance that the lender with decline the loan before closing and the seller is stuck with those additional cost of repairs.
Understanding the Sellers Market
In a seller’s market, there are more buyers than sellers and n a buyer’s market, there are more sellers than there are buyers. Supply and demand and the scarcity of product create higher demand and drives prices up. It really is that simple and if you are a seller you have the advantage already of having less houses than there are buyers.
I think that there is a big misconception out there that just because it is a sellers market that you can dictate all of the terms and thus buyers are just going to roll over. What it means is that you have one thing less huge thing that you have to worry about. It means less competition in other houses competing. It doesn’t mean you can afford to be less competitive. You have an opportunity to stand out and it is up to you to take it. Now is the time to take off the gloves and really shine. If you do, the market and the buyers are yours. It will all happen very fast and you’ll wonder all the way to the bank why everyone is wringing their hands about selling their house in Sacramento.
Sell My House Fast how to take advantage of a seller’s market in Sacramento.
Advantage #1 Home Prices Tend to be Higher
Following the simple rule of supply and demand, your house got an automatic bump in price because of the scarcity houses for sale in Sacramento. Buyers are scrambling from the bay area to get what’s left of a California bargain. Renters are realizing that even though local governments talking rent control, it is becoming cheaper to make a house payment than the rent. Finally, there is no new affordable housing. Construction of houses under $400,000 is non existent. The only thing that can happen is that prices will go up.
Even for the ugliest of homes.
Every sale begins with a house. Remember there are roughly 4 criteria that make your house a great product. It all starts with its age, its location, its condition and its price. If one or more of these criteria are out of synch with the others it is a recipe for failure. Even in a sellers market, there is only so much deferred maintenance that can be overlooked by buyers and lenders. When that happens, the targeting of the marketing has failed and at that point it is the sellers fault. Be realistic about what you want. Sure you can ask for a high price but if your house is just sitting, you may already know the answer.
Regardless of the condition of your house, now may be the best time ever to sell. You can ask a higher price (and often get it) because buyers don’t have as many choices available to them. So the first way to take advantage of the seller’s market is to simply ask for more money, but make sure you are talking to the right market.
Pretty House = Conventional Buyers with Financing and Contingencies with extended Sales cycles and longer Closing time frames
Ugly House = Real Estate Investors in Sacramento or Cash home buyers. Typically all Cash, with No Contingencies, No Inspections and Fast Closing Dates
Advantage #2 Buyers Remove Contingencies Earlier
Price is just one component of selling a house. So are the location, it,s age and condition. All four need to be in synch for the sale to occur.
Buyer’s that are interested make offers that are conditioned. These conditions are called contingencies and they include financing, inspections, repairs, updates, home warranties, down payment assistance, closing credits and appliances that will remain in place. But these are what the buyer might ask for. As a seller, you can ask for certain conditions, too but make sure that what you want is conducive to making the sale rather than just getting a tit for a tat.
For example, if your house was just remodeled why not ask the buyers to remove the inspection contingency early. Why not ask for all inspections to be completed within 10 days?
You need to understand that these contingencies are the buyer merely hedging their bet with conditions that they place on the sale so that if something comes up they can back out without losing their deposit. You read that right… in today’s real estate world, even in a sellers market, the seller is the only one that has any risk because the buyer can and often does change their mind. Unfortunately it is very common and it happens a lot.
Advantage #3 Competition Often Generates Multiple Offers
Multiple offers are great, but dont think for a moment that all offers are created equal. In today’s world, the majority of buyers want move in ready and that means that they want a lot of other things as well. Some are reasonable and some are just … pie in the sky. As the seller you dont have to indulge them. You just need to understand them and respond accordingly.
You also need to understand that there are a lot of buyers that didn’t get the memo about the sellers market. There are some that want to buy a house so bad that they want the seller to participate in every step, make every repair and update, lower the price and HELP them with the down payment. Imagine that being your first offer. Now imagine it being a different iteration of the same theme with three offers? You begin to wonder if there is a conspiracy or if they are for real. But dont despair, even though they are for real, you can always negotiate the terms that you want with a well crafted Counter Offer. (See Below)
Advantage #4 Ask for a Fast Closing Date
Everything happens in time and in real estate it is no different. Escrow periods generally last 30 to 45 days because that is what most real estate agents, lenders and title companies have accepted. Like every other industry real estate has a set of conventions that become unspoken rules and when you breach that convention you are sort of scolded or chastised. Real estate agents are great at telling you how things work in their world. They dont know what they just know that it’s the way it is.
As a buyer or seller I have never been big on following the convention and the truth be told I’m not really interested in stories why other people dont or can’t get done any faster. Things can always be done more quickly and efficiently and what I have found is that the people that dont like my attitude don’t want to work with me. But, what I have really found is that most people see me coming and the expectation is already set that I am going to want it done as fast as possible. The ones that resit have a hared time. Most dont.
Time is money and as the seller you have holding cost such as mortgage cost, insurance payments, utilities and others. Ask for a closing date of 30 days or less. It works 99.9% of the time. Ruffling feathers? Who cares if the money is in the bank?
Advantage #5 The Counter Offer Puts the Seller Back in Charge
Because it is a sellers market, your advantage increases. If you have a great house at a great price you can put together a Counter Offer and set the world correctly back on its axis.
A lot of buyers will ask for the world and you’d be amazed how many come back to reality with a well crafted Counter offer. Strategically speaking, a counter offer is a sort of cleansing that brings buyers and sellers back to ground floor. Caution however, if you are receiving multiple offers with a reduced price and no takers on your counter offer. Your Price is the problem… even in this sellers market. Counter offer are the real way to get to the bottom line and a Pending Sale Sign in the yard.
Advantage #6 Target the Right Buyers for the House that You Have
The biggest problem with selling houses is the one size fits all mentality of real estate agents. It’s a commission thing and a bad marketing thing.
Here is the deal, some Houses are have special needs and special buyers. I am talking about the ugly houses that need an insane amount of work. Unless there is something really special about your real estate agent, you are just giving your equity away in the form of a commission. Save your money… Google… “Who Buys Houses in Sacramento” and make 5 to 10 phone calls. You’ll find a cash home buyer in Sacramento. Or Just call Peter Westbrook at (209)481-7780 and we’ll make you a cash offer today!
Summary
There are many different components to a sale of a house. From beginning to end it is supposed to be a grueling process to make sure that the house can pass a series of tests. Every house has its positive and negative attributes. Along the way you have the buyers hoping that the house passes every test thrown at it, on the other side the sellers hoping for the same. In the end it’s a matter of everything coming together to make that happen.
Your house, its condition, its location, the offers, the contingencies, the counter offers, the inspections, the repairs, the appraisals and the lender conditions. They collectively are tests and roadblocks. By design, they are meant to give pause to excited buyers and sellers. In spite of it all, roughly 75% of all houses that get this far make it through. In this market the advantage goes to the seller. It certainly is no guarantee, but in a sellers market your house has more attention and it did get a pricing bump. Be thankful. Now in order to take advantage of the seller’s market implement these tips to to your advantage and position your house to be its best. Then negotiate bigger returns, the removal of contingencies, and enjoy multiple offers to choose from.
If none of that excites you or if your house is in need of a lot of repairs don’t forget that we’ are cash home buyers in Sacramento and we’d love to give you a fair all-cash offer to buy your house today.
There’s no obligation so doesn’t it make sense to at least see how much we’d pay? Get in touch with us by phone at (209)481-7780 or by clicking here and filling out the form.
