The experience of selling your house will be influenced by the market you’re selling into. In this article, you’ll read about how to take advantage of a seller’s market in Raleigh-Durham.
The Raleigh-Durham area of North Carolina has been in a seller’s market for several years. This has been due to a shortage of inventory created after the great recession of the late 2000s. This means there are fewer houses for sale to choose from making it competitive for buyers to find a house that they want and can afford.
How To Take Advantage Of A Seller’s Market In Raleigh – Durham
Speed Of Sale
Usually, hot markets are accompanied by lower days on market (DOM). As of April 2020, the average days on market are 21 with the lowest being only 1 day. So in a hot market, you can find a buyer for your house in as little as one day. This is an advantage because it allows you to get your money faster, with fewer showings, shorter hold times which means reduced selling costs.
Aggressive List Price
A hot market allows many home sellers to be more aggressive with pricing there homes. Part of this is due to the appreciation that is realized during hot markets. Also, supply and demand allow sellers to ask a higher price because there is not enough inventory that is available. This has to be done within reason. There are still about 1% of listed houses that go unsold. I have seen many listings sit on the market for months because the seller is asking an unreasonable price, the home is not showing well, or both.
Negotiate Better Terms
There are multiple items to evaluate when receiving an offer on your house. One of those items is the terms and contingencies associated with the purchase. In a hot market sellers can be more selective when negotiating some of the following terms:
- Length of the inspection period
- Larger due diligence fees/earnest money deposit
- Closing costs
- Contingencies (financing, selling a current house)
- Repairs
A seller can negotiate a shorter inspection period as well as a larger due diligence fee and earnest money deposit. The due-diligence fee is the money you get to keep if the buyer backs out.
The seller can also be more reluctant to pay buyer closing costs and other concessions associated with the negotiation process. This includes denying offers that are contingent upon selling another residence.
The repair requests are where the seller is the most vulnerable. This occurs after the buyer hires a home inspector and a laundry list of repair items is submitted. Hot markets give sellers more leverage during this process. about denying certain requests, especially if multiple offers were received.
Multiple Offers
Multiple offer situations put the seller in an advantageous position. This is when the seller or agent discloses that there are multiple offers and requests that all interested parties submit their highest and best offer. This creates a bidding situation which can lead to significant profit. As has been the case in the Raleigh NC market the offers are bid over and above the listing price! This eliminates the need for the ‘back and forth’ that is associated with negotiating a single offer.
There are a few things to keep in mind here. Multiple offer situations can backfire in that buyers are reluctant to bid on a property and all interested parties disburse and look elsewhere.
Selling a home during a hot market can be a very rewarding and profitable experience. Many homeowners enjoy a wider margin of error during the selling process.