December is usually a consultative month for me. Lots of people call to have me come over and take a look at their homes, as they’re thinking about selling in the spring. This December was no different in that respect, I received calls and went on my appointments.
However, there was one major difference this year. I spent quite a bit of the time quietly feeling like a jerk. Usually when I went back to see people with my completed market analysis, I wasn’t delivering very good news. The people that lived in their homes for 10+ years were fine in most cases, but there were several people I met with that have lived in their homes for 5 years or less. Their news was not so good. Many of them, if they do choose to sell, will most likely need to bring money with them to closing. There will not be enough equity in their home sale to cover their closing costs (commission fees, conveyance taxes, attorney fees, etc.) and pay off their existing mortgage(s). A few years ago when home prices were rising rapidly, this almost never would have been the case. Today, it is very common.
The one surprising result from many of my conversations was that sellers understood and, in most cases, agreed with the analysis I presented. Data about the current market for their town and neighborhood, as well as recent sales and homes currently for sale in their proposed price range seemed to resonate well and bring some reality to the situation. They did not think I was being a jerk or try to shoot the messenger. I was just a relayer of what’s going on in the market.
If anything, our meetings helped them understand what to expect in the spring and what they could be doing now in order to get their home in the best shape possible so it will sell quickly and (hopefully) at the top of my recommended price range.
Some of these folks will choose to sell their homes next year and some will stay put for awhile longer. There are many others going through the same iterations with their real estate agents right now. In 2009, the sellers that will be successful will price reasonably and react quickly to market changes. Otherwise you may be holding on to your house, whether you’d like to or not.
