Spring is Coming – Time to Find Sellers If You’re Not Doing So Already
So far, 2023 is off to an interesting start, to say the least. And, in terms of the housing market and the economy overall, we’re not really sure what’s in store. After looking at the trends for this year, what we do know is that there’s a shortage of inventory, mortgage and interest rates are still low, and millennials are still buying homes despite what many may think. We also know that baby boomers are choosing to stay in their homes a little bit longer until they can get better offers down the road. Overall, there are a lot of patterns, yet still a lot of uncertainty.
What we can be certain about, though, is that spring is here. As usual, it’s a good time to start working on some general “spring cleaning” – working on your taxes, sifting through leads that have gone cold, updating your marketing materials and listings, deleting emails in your inbox…that sort of thing.
And, it’s also a good time to start finding sellers. Spring is usually a time for new buyers to come out of their winter hibernation and start looking for a home. But, this is mostly because there are more options in the spring, as this is when more sellers decide to list their homes. Even with taking into consideration what we know about the housing shortage and baby boomers, there are still plenty of people looking to sell (especially now, since the state of the economy is predicted to get worse).
So, here’s what you can do to focus more on sellers this spring.
Many Places are in a Seller’s Market
When people are still looking to buy homes because of low mortgage rates, and when there’s a shortage of inventory, that increases the demand for homes. Of course, if you’re an agent, you know that this means that buyers need to outbid other buyers in order to compete, which is very beneficial to sellers who were previously holding off until getting an offer that they wanted. It’s also beneficial to you.
However, we’re still seeing strong buyer markets in many major cities, so it’s important to stay up-to-date with how the market is doing (or predicted to do in your area). For instance, right now we are seeing a seller’s market in Brown County, Wisconsin.
Take a Look at the Tell-Tale Signs
If you’re new to real estate, just need a refresher, or you’re interested in getting involved as an investor, the best way to determine whether or not you’re in a seller’s market is to look at the tell-tale signs of one. To determine whether or not it’s time to start marketing to sellers (and, chances are that it could be), understand:
- How long are homes in your area on the market before they sell? According to HomeLight, on average, homes spend 75 days on the market. This is more than double what it was in May 2022 (31). So you’re looking at roughly 4 months from list to close without factoring in the time it takes preparing to put the house on the market.
- Have there been significant and/or frequent price cuts? If there are consistent price cuts on homes in your area, and/or those price cuts have been for quite a bit of money?
- How much did homes actually sell for once they sold? By looking at what homes actually sold for compared to what they originally listed for, you can usually get a very good idea of whether or not you’re in a buyer’s market or a seller’s market.
Tips on Finding Sellers
Now that you know whether or not you’re in a seller’s market, it may have been some time since you last had to prospect a seller. Therefore, it’s helpful to have some new ideas about who to market and how to market to them:
- Take on those less-than-attractive listings. There are a lot of investors/smart-buyers these days!
- Try some old-fashioned door-knocking.
- Get out in the community. Nothing wrong with the classic, “Do you know anyone who is looking to buy or sell a home?”
- Referrals, referrals, referrals. Offer incentives to past clients and reach out to other colleagues and real estate agents who may be looking to get rid of one of their listings.
- Consider pursuing expired listings and FSBO listings, as this is an area of the market that is often ignored.
What to Remember about the Housing Market in 2023
The housing market already had a lot of interesting predictions going into this year, and that was before other factors – like inflation and rising interest rates, for example – started to make their impact.
At this point, things are still more or less where they were when the new year began, but with many forecasting another housing market crash, many things are still up in the air right now. So, for now, try to be excited about the warmer weather despite everything going on, and consider marketing to sellers if your local market seems to be heading in that direction.
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