Back in the day when I was a Realtor, there was a certain mantra about the fall season that was preached time and time again. “When the leaves fall, so do the home prices.” I don’t think it’s any secret that the housing market, at least here in the upper Midwest, is slowing down. But it is slowing at a rate that doesn’t seem to be alarming anyone either. It is simply our seasonal slowdown. It happens every year.
Why does this happen? What does it mean for anyone looking to buy or sell? Read on and I’ll give you some insight.
“So why don’t people want to move in the fall?”
More accurately, it’s the people that are shopping and signing purchase contracts in the fall. As the system rolls, from purchase contract to closing is probably going to be at least 45 days. As I write, were you to sign a purchase contract now, you would actually be moving in to your new home right around the end of November.
Not to mention the Holidays, you could be carrying all of that furniture through below-freezing temperatures, driving snow, or possibly over ice-covered sidewalks. Doesn’t that sound like moving-day-fun? Then, you need to keep the front door of your new home wide open for hours of moving, allowing your furnace to try and heat the outside as well as the inside of your new home.
Oh yeah – if you have kids, there’s the whole moving schools/new teachers/making friends mid-year thing too.
“So why would anyone want to move this time of year?”
Good question. For some, it just might be the right time. Their lease on an apartment is ending, they are newly married/divorced, they finally have enough savings or have their credit cleaned up. And then there is that whole “When the leaves fall….” thing. It may be an opportunity to get a better deal on a home. While the selection may be down a little, there are probably also fewer buyers out there looking.
“But what if we have one to sell first? Won’t we get less for it?”
Well, yes. Quite possibly. But unless you are going to sell in the spring/summer and then either rent or be homeless for a few months until the prices fall, there is going to be a bit of a trade-off. While you may not get quite as much for your current home, you will probably get a similar deal on your new one. In this instance, it is going to be factors other than prices that determine whether or not it is time for you to move.
“So you’re saying it may be a good time to sell.”
Yes, it could be. If you have a home in great condition in a market with fewer options, the ability to stand out may actually allow you to keep the price a little higher. But the home has to be ready-to-go. We may well be on our last days of shingling and exterior painting for this year. If you don’t have those done yet, it may be too late. So what do you have going on this weekend?
If you need a little extra time to shop for the next home of your own, you can negotiate for that in the purchase contract of your current home. While most purchases are taking at least 45 days from contract to close, that is the minimum. You can negotiate for longer if you need it. But then you are pushing all of the closing and moving excitement right up into Christmas.
Maybe you can convince your extended family that helping you unpack is kind of like opening presents…. that they don’t get to keep…. unless it’s one of those plastic singing fish that hangs on the wall….
Reading back, I realize some of this (or a lot of it) may sound a little non-committal. You would think my voice would be just a bit higher from all of the fence straddling I’ve done. But that’s the reality of the housing market this time of year. The weather changes every day and it can have a big impact on buyers’ and sellers’ mentality.
In short, if you are even considering it, talk to a good Realtor about your home, the market, and your options.
“How do you know who the good ones are?”
I get it. In the last week I’ve had contact with two different situations that most likely involved ethical violations. But those are only two of many, many Realtors out there. There are some excellent Realtors who would like nothing more than to give you the best information and then let you make up your own mind.
The best way to find a good Realtor or any other professional is to ask around. Ask people you know that actually like you. They will tell you who they used and, as long as they like you, don’t want you to get hooked by the bad ones. Ask a lot of questions of both your friends and family as well as the Realtor you may possibly sign with. Only sign papers with them if you are comfortable and trust them.
A good Realtor will give you the skinny on where your home sits in the market, what will probably happen if you try to sell it, and what your prospects are for buying what you want in the next one.
There’s one more piece to figuring out this home-buying process. The Center for Financial Resources offers Homebuyer Express. The free class covers many home-buying topics to help you be better prepared for the process. Depending on where you close, it may even help you qualify for closing cost credits.
To reserve your spot in the class, you can either call 605-330-2700 or visit our website to register.
written by Breck Miller
image courtesy freedigitalimages.net