Not so much.
You state, â€œUpper end sellers are unrealistic on prices.â€
Iâ€™d respond by saying, â€œThatâ€™s their prerogative.â€ When their homes have been on the market for months and donâ€™t sell, theyâ€™ll learn. Or theyâ€™ll take them off them off the market and â€˜waitâ€™ for the market to â€˜improve.â€™ If it ever will. And if they DONâ€™T learn, itâ€™s not because they havenâ€™t had plenty off opportunities to do so. On the whole, the upper-end homes belong to very well-educated people. They try to figure the angles on everything and then work the system to their advantage. Once they think they have it figured out, theyâ€™ll insist on doing it their way and will just have to learn their in own way and in due time. No amount of â€˜splaininâ€™ from me is going to work.
Some of them just need another degree â€“ from the school of hard knocks.
And then you further say, â€œThey need a push to sell NOW!â€
To which Iâ€™d ask, â€œWHY?â€ People sell for a number of reasons that relate to personal motivations. Iâ€™ve learned over the years that it is not in my best interest to try to motivate anyone in real estate. Iâ€™m a facilitator, not a motivator. Thatâ€™s why my clients keep coming back: they know theyâ€™ll get honest answers without the drum beating and hyper-sales pitch. When they ask for my opinion, Iâ€™ll give it to them and it will be based on solid market data and analysis, not hyperbole.
And then you finish with, â€œShould we not be on the roof yelling to the upper end fence sitters, "NOW IS THE TIME TO SELL, BEFORE RATES GO UP!"â€
You go. Good luck with that.
I would like to add that in a market like Sacramento one could argue that the low home prices could usurp the rising interest rates somewhat.
I used to live in Sacramento and I am amazed at the drop in prices. A couple of weeks ago I was looking on the Sacramento MLS and saw a home on Mohawk Drive in Fair Oaks that was priced at $145,000. It looked like the same home that I was thinking of buying in 1990, and the asking price at that time was $145,000. Zero gain in 20 years! Amazing.
Here in the Bay Area some of the low end areas are priced at 1998 prices. I am not worried about my clients buying into these areas. Even in a rising interest rate environment.
But some of the high end areas like Lafayette and Alamo are still trending at 2005 prices. Rising interest rates could have a big effect on these overpriced jumbo loan bearing bubble priced homes.
Whatever pitch is used has consequences that are counterproductive. For example sophisticated buyers will reply "If rates go up won't prices go down?" They might...who knows. I shy away from any short term "angle" because in this environment where events are changing every two months, you cant guarentee that rates will go up in the future. The fed could buy another trillion in debt and rates will remain right here for another two years if the economy continues to plod along.
Buyers should focus on the long term and uncompromisingly find a home that affordably meets all their needs.
Real estate is a simple game. You need motivated buyers and sellers. The theory that you can somehow motivate a buyer or seller to do something is off. It's not necessarily an impulse buy or sale. What works is screening your prospects for motive and working with the ones that are most motivated to buy or sell based on asking them a few key questions. If your next question is where do I get the prospects, hook up with a real estate coach such as realestatetrainingwithdavidknox.com as it will benefit your business greatly. Standing on the roof yelling, just creates noise. If you are not asking open ended questions of the prospects you are wasting your time.
It all translates to affordability. Lower rates make my listings affordable to more buyers, potentially netting my sellers more money. Most of my sellers are also buyers and the low prices and low rates mean their next home will be more affordable too.
If a $200,000 house lost 20% of its value in the decline, it's worth $160,000 now. If the move up house they want to buy was worth $500,000 at the peak and lost 20% it's now worth $400,000. The spread between the values has been reduced by $60,000.
Between low rates and low prices, this can be a very attractive market for many.
The thing is that it's a good time to buy when a buyer is really ready for home ownership responsibility and or investment responsibility!