SELLING IN A SLOWER MARKET

The media is all abuzz with news of a buyer's market and doom-and-gloom. Have you heard it?

Let's look at some perspective. Buyers hear they can call the shots and offer at least 10% lower than asking prices. Sellers hear their homes will take months to sell and even then, they shouldn't hope to get close to asking price. Sound familiar?
It's true that there is currently an oversupply of homes in the Twin Cities market. The past few years with low interest rates and rapidly appreciating real estate values have seen many investors get into the market. One out of three homes sold in 2004 and 2005 were second property purchases-either vacation homes or investment properties (re-hab, flips or rentals). In addition to this, look around the Twin Cities area. There is new construction everywhere you look. (sidebar note: Much of the new construction is also financed by investors and not who you'd think. These are average people like you and me looking for a better rate of return than the stock market can provide, not the three-piece suit cigar chomping "Mr. Biggs")

What this all means is there are LOTS of homes for sale. In July 2006, there were 6.76 homes available for sale for each active buyer. The prediction for August is 6.36 homes per buyer.

If you are thinking about selling your home, think back to economic fundementals - supply and demand. The crossing of the supply and demand curves determine what the market is willing to pay for your home. You have a few techniques to influence this market value. To increase the value of your home, you need to either increase demand or decrease supply. You need to DIFFERENTIATE your home, make it stand out from the pack where possible. How do we do this? Either through strategic improvements in the right areas of your home or through showcasing of your home's features.

Strategic Improvements. Have a trusted acquaintance or Realtor walk through your home and give you their honest opinion as a homebuyer. Are the countertops dated or damaged? Kitchens and bathrooms are statistically the best places to invest your money and give you the most bang-for-your-buck. Use caution with how much money you put into your home just to sell it. A fresh coat of paint goes a l-o-n-g way to improving the feel of a home's interior.

Showcasing Your Home's Features. An accredited Staging professional, interior designer or Realtor can walk through your home and give you a list of recommendations to ensure your home will feel warm and welcoming to buyers and ensure key features are made more prominent. Common items are moving furniture away from walls, subtle accent paint on one wall of a room and editing (eliminating clutter). Ensure closets and other storage areas aren't jam-packed with stuff. Make them 1/2 full to give the impression of spaciousness. Use 1, 3 and 5 for any arrangements. These are artistic numbers - the mantle, counter-top, etc. should have 1, 3 or 5 items to give your home a harmonious feel. Don't have too many pictures or too much furniture in a room. Try to give at least 36", if not 42" of walking space through your furniture arrangement. Remember - less is more.

Does this sound like work? Possibly. How many people do this? Not many. If you are willing to invest a little time, effort and possibly a small amount of money into ensuring your home is well-positioned in the market, it will set your home apart, effectively reducing the supply of homes in your category which may give you a little more money for your home, improve your negotiating position and will cause your home to sell faster.

Doom and gloom? No. Challenging? Yes. And who doesn't like a good challenge?