Historically, the last few weeks of the year aren’t the most active on the real estate calendar. But the spring market, which can begin as early as mid-January, brings a spike in activity from both buyers and sellers. Changing market conditions will make this coming spring market much different from the last one, so the time to start strategizing is now, real estate experts say. If you’re selling your home next year, here are some tips to start preparing.
Get In Showing Shape
According to Natasha O’Connor, managing broker in @properties Christie’s International Real Estate’s Northbrook and Glenview offices, “Now is a great time to think about hiring a contractor for updates and repairs.” Not only do many pre-sale renovation projects take several weeks, but contractors are usually less busy at this time of year. That means you not only should be able to get on their schedule; you might also be able to negotiate better pricing.
With the robust sellers’ market of the past two years largely in the rearview, a home’s condition will take on heightened importance in the spring market, O’Connor predicts.
“The goal is to have the home in the best shape possible to command the highest price. Sellers should take the time to consult with an agent now to understand the current marketplace and determine what items need to be addressed prior to listing,” she said.
Price it Right
Currently, buyers are dealing with inflation and high mortgage interest rates and no longer operating from a place of “fear and scarcity” when making an offer on a home, said O’Connor. Noting a nationwide 10.2% drop in pending home sales in September*, O’Connor said the unprecedented price appreciation of 2021 and early 2022 has leveled off.
Rick Sobin, managing broker of @properties Christie’s International Real Estate’s Gold Coast and Lincoln Park offices, added that when a home is priced accurately there will be plenty of activity, regardless of market conditions. “You’ll see a high demand for showings, second showings, and typically an offer within the first 30 to 60 days,” he said.
“Price is the largest determining factor of how long a home will stay on the market,” said Sobin. “And because new listings generate the highest level of interest overpricing immediately and negatively impacts your selling prospects.”
Avoid Overpricing Pitfalls
O’Connor and Sobin cited several issues that can arise from pricing a property too high:
- Brokers and buyers embark on a search within a specific price range. If a home is not priced correctly relative to its competition, it might not get any exposure among its true target audience.
- An overpriced property sits on the market and buyers begin to wonder what is wrong with it. Additionally, some buyers won’t even engage with a seller who overprices a listing – assuming they’re unreasonable and difficult to work with.
- Ultimately, when a seller comes out too high, they’ll end up carrying the property longer than anticipated and taking less than what they would have had they priced competitively.
As sellers begin preparation for the Spring market, Sobin said not to discount listing your home in December. “People have a lot of time on their hands to explore the market and some have received end-of-year bonuses putting them in a position to buy.”
*NAR, September Pending Home Sales Index