Why You Need an Agent To Set the Right Asking Price
Why You Need an Agent to Set the Right Asking Price When it comes to selling your home, one of the most critical decisions you'll face is setting the right asking price. It’s a delicate balance—price it too high, and you risk turning away potential buyers; price it too low, and you could leave money on the table. According to a recent study, 58% of sellers find determining the right price to be the most challenging part of the selling process. Here’s why this step is so important and how a knowledgeable real estate agent can help you find that sweet spot. The Most Challenging Task for Sellers Setting the right price tops the list of challenges for home sellers, outpacing other concerns such as: Understanding market demand (22%) Handling legal and regulatory requirements (8%) Marketing and reaching potential buyers (5%) Negotiating with buyers (4%) The numbers don’t lie: pricing is the most daunting task for sellers. Why? Because it requires a nuanced understanding of the market, buyer psychology, and current trends—not to mention a good deal of objectivity, which can be hard for homeowners with emotional ties to their property. Why Getting the Price Right Matters Pricing your home correctly is about more than just attracting buyers; it’s about ensuring a smooth and successful sale. Here’s what can happen depending on how you price your home: Overpriced Turns Buyers Away: Buyers may see your home as overpriced compared to similar listings and not even bother scheduling a tour. Lingers on the Market: Homes priced too high tend to sit unsold, leading buyers to wonder if something’s wrong with the property. Requires Price Drops: You might eventually need to reduce the price to reignite interest, but by then, the initial buzz surrounding your listing has faded. Market Value Attracts More Buyers: A competitively priced home stands out and generates more interest. Encourages Multiple Offers: The right price can create competition among buyers, potentially driving up the final sale price. Sells Faster: Homes priced at market value tend to sell quickly, reducing the stress of a prolonged sale process. Underpriced Raises Red Flags: Buyers might assume something is wrong with the property if it’s priced too low. Leaves Money on the Table: You’ll miss out on maximizing your investment. Impacts Future Buying Power: Undervaluing your home can limit your options when purchasing your next property. How a Knowledgeable Agent Can Help Only an experienced real estate agent has the expertise to determine the market value sweet spot. Here’s how they do it: Understanding Market Trends: Agents have access to comprehensive market data and understand how recent sales, inventory levels, and buyer demand impact pricing. Objective Evaluation: While homeowners may have an emotional connection to their property, agents can provide an unbiased assessment of its true value. Strategic Pricing: Agents use a combination of comparative market analysis and their industry knowledge to set a price that attracts buyers and maximizes your return. As Bankrate explains, “A knowledgeable agent will understand fair market value in your area, how much your house is worth, and how much you might reasonably expect to get for it in the current market.” The Bottom Line Pricing your home isn’t just about picking a number—it’s a strategic decision that can make or break your sale. By partnering with a local real estate agent, you gain the expertise needed to navigate this crucial step. They’ll ensure your home is priced to sell, not to sit. Ready to get started? Connect with me today and let me help you make the right move. When the price is compelling, it’s selling.
What To Look For From This Week’s Fed Meeting
You may be hearing a lot of talk about the Federal Reserve (the Fed) and how their actions will impact the housing market right now. Here’s why. The Fed meets again this week to decide the next step with the Federal Funds Rate. That's how much it costs banks to borrow from each other. Now, that’s not the same thing as setting mortgage rates, but mortgage rates can be influenced through this process. And if you’re thinking about buying or selling a home, you may be wondering about the downstream impact and when mortgage rates will come down. Here’s a quick rundown of what you need to know to help you anticipate what’ll happen next. The Fed’s decisions are guided by these three key economic indicators: The Direction of Inflation How Many Jobs the Economy Is Adding The Unemployment Rate Let’s take a look at each one. 1. The Direction of Inflation You’ve likely noticed prices for everyday goods and services seem to be higher each time you make a purchase at the store. That’s because of inflation – and the Fed wants to see that number come back down so it’s closer to their 2% target. Right now, it’s still higher than that. But despite a little volatility, inflation has generally been moving in the right direction. It gradually came down over the past two years, and is holding fairly steady right now (see graph below): The path of inflation – though still not at their target rate – is a big part of the reason why the Fed will likely lower the Fed Funds Rate again this week to make borrowing less expensive, while still ensuring the economy continues to grow. 2. How Many Jobs the Economy Is Adding The Fed is also keeping an eye on how many new jobs are added to the economy each month. They want job growth to slow down a bit before they cut the Federal Funds Rate further. When fewer jobs are created, it shows the economy is still doing well, but gradually cooling off—exactly what they’re aiming for. And that’s what’s happening right now. Reuters says: “Any doubts the Federal Reserve will go ahead with an interest-rate cut . . . fell away on Friday after a government report showed U.S. employers added fewer workers in October than in any month since December 2020.” Employers are still hiring, but just not as many positions right now. This shows the job market is starting to slow down after running hot for a while, which is what the Fed wants to see. 3. The Unemployment Rate The unemployment rate shows the percentage of people who want jobs but can’t find them. A low unemployment rate means most people are working, which is great. However, it can push inflation higher because more people working means more spending—and that makes prices go up. Many economists consider any unemployment rate below 5% to be as close to full employment as is realistically possible. In the most recent report, unemployment is sitting at 4.1% (see graph below): Unemployment this low shows the labor market is still strong even as fewer jobs were added to the economy. That’s the balance the Fed is looking for. What Does This Mean Going Forward? Overall, the economy is headed in the direction the Fed wants to see – and that’s why experts say they will likely cut the Federal Funds Rate by a quarter of a percentage point this week, according to the CME FedWatch Tool. If that expectation ends up being correct, that could pave the way for mortgage rates to come down too. But that doesn’t mean they’ll fall immediately. It will take some time. Remember, the Fed doesn’t determine mortgage rates. Forecasts show mortgage rates will ease more gradually over the course of the next year as long as these economic indicators continue to move in the right direction and the Fed can continue their Federal Funds rate cuts through 2025. But a change in any one of the factors mentioned here could cause a shift in the market and in the Fed’s actions in the days and months ahead. So, brace for some volatility, and for mortgage rates to respond along the way. As Ralph McLaughlin, Senior Economist at Realtor.com, notes: "The trajectory of rates over the coming months will be largely dependent on three key factors: (1) the performance of the labor market, (2) the outcome of the presidential election, and (3) any possible reemergence of inflationary pressure. While volatility has been the theme of mortgage rates over the past several months, we expect stability to reemerge towards the end of November and into early December." Bottom Line While the Fed’s actions play a part, economic data and market conditions are what really drive mortgage rates. As we move through the rest of 2024 and 2025, expect rates to stabilize or decline gradually, offering more certainty in what has been a volatile market.
Why Home Sales Bounce Back After Presidential Elections
With the 2024 Presidential election fast approaching, you might be wondering what impact, if any, it’s having on the housing market. Let’s break it down. Election Years Bring a Temporary Slowdown In any given year, home sales slow down slightly in the fall. It’s a typical, seasonal trend. However, according to data from BTIG, in election years there’s usually a slightly larger dip in home sales in the month leading up to Election Day (see graph below): Why? Uncertainty. Many consumers hold off on making major decisions or purchases while they wait to see how the election will play out. It’s a pattern that’s shown up time and time again, and it's particularly apparent for buyers and sellers in the housing market. This year is no different. A recent survey from Redfin found that 23% of potential first-time homebuyers said they’re waiting until after the election to buy. That’s nearly a quarter of first-time buyers hitting the pause button, likely due to the same feelings of uncertainty. Home Sales Bounce Back After the Election The good news is these delayed sales aren’t lost forever—they’re just postponed. History shows sales tend to rebound after the election is over. In fact, home sales have actually increased 82% of the time in the year after the election (see chart below): That’s because once the election dust settles, buyers and sellers have a sense of what’s ahead and generally feel more confident moving forward with their decisions. And that leads to a boost in home sales. What To Expect in 2025 If history is any indicator, that means more homes will sell next year. And based on the latest forecasts, that’s exactly what you should expect. As the graph below shows, the housing market is on pace to sell a total of 4.6 million homes this year, and projections are for 5.2 million total sales next year (see graph below): And that aligns with the typical pattern of post-election rebounds. So, while it might feel like the market is slowing down right now, it’s more of a temporary dip rather than a long-term trend. As has been the case before, once the election uncertainty passes, buyers and sellers will return to the market. Bottom Line It's important to remember that while election years often bring a short-term slowdown in the housing market, the pause is usually temporary. Those sales are not lost. Data shows home sales typically increase the year after a Presidential election, and current forecasts indicate 2025 will be no different. If you’re waiting for a clearer picture before making a move, just know that the market is expected to pick up speed in the months ahead.
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