Can it be a good time to buy AND sell?

Our real estate market here in Gig Harbor has been pretty healthy throughout this past year's national "crisis." We're just now starting to feel the effects of the housing market slow down, and are for the first time in my real estate career pretty clearly in a "buyer's market." While that may sound good for my buyers, what about my sellers? Is "buyer's market" the best term?

I like to look at this (and this isn't my phrase) as "A market of opportunity." Why? Well, because that's what it is. This market presents some great opportunities for both buyers and sellers. How? Let me explain.

Right now our inventory is huge. In Gig Harbor, there are 601 single family homes currently for sale. That's significantly higher than I've ever seen it (we were at 500 homes on January 1st!). For home buyers, the opportunities are fairly obvious. Higher supply generally means less demand, which generally means lower prices, which means more choices at better prices. Doesn't take much to see why this is a good time to be a home buyer. Yet, if it's that obvious, where are all the buyers? Sitting and waiting for the prices to go down even further, I think. Will they? Maybe, maybe not. Time Magazine ran a great 1 page article 2 weeks ago showing why it's not necessarily beneficial to wait, weighing current interest rates versus projected and current prices versus projected. That's not my point, though. Bottom line is folks looking to buy a home in Gig Harbor have more houses to choose from than ever before, and they have more negotiating power now as sellers get antsy. Clearly, it's a good time to buy.

So how can it also be a good time to sell? If you are considering upgrading to a larger house, or maybe one of Gig Harbor's 100's of waterview homes, or maybe you're planning on downsizing to a newer, closer to town, but smaller home, you can make now your best time to move. Let's say your current home in Gig Harbor's Rosedale district is valued between $425k-$450k. There are about 25 homes on the market currently in that price range. Your gut tells you to list at $449,950, because you know that last year you could have sold for $465k. Fight that instinct and follow this logic. What if you were to list at $425k instead? Now, you are at the bottom of that range, and assuming all else is equal you've become the most desirable home of the 25 or so in that price range. Homes that are priced well are still selling in under 40 days in Gig Harbor, versus the average of over 90 days. So you sell your home in about a month for $425k, wondering if you just left $25k or more on the table (you didn't...if you're house was priced too low you would have received multiple offers).

Now, you want to move to a nice view home near Kopachuck in Gig Harbor. What you (or more specifically your agent) should look for is one of these sellers who is now chasing the market. Remember when you could have listed for $450k, but chose not too? Well, those sellers of the view homes had that same choice, but most of them (like most of all sellers) chose to list at the high end of their range, and they're now "Chasing the Market" trying to keep up with all of the "Price Reduced" signs and "Just listed" homes that keep popping up. Their view home may have started at $650k, may currently be listed at $610k, and the sellers may be getting nervous as the home's been listed for 5 months with no offers. So you come in with an offer of $590k, and the seller feels forced to take it, as it's the only offer they've seen and they know more price reductions are on the horizon.

Do you see what happened? Even though you "Left" $25k on the table of your sale, you picked up $60k on your purchase. Now, I know these numbers are hypothetical, but the strategy is sound. Price your home at the lower end of the comparable range right off the bat. Get it sold quickly. Find homes that didn't do that, the ones that you know have been listed (maybe by a few different agents) for several months and have had multiple price reductions. The reality is that homes that are overpriced to begin with will almost always sell for far LESS than what they're worth. Price your home right at the start, and you'll get your value (even if that value is a bit less than what it was a year ago). Don't get caught chasing the market as a seller, but jump on those homes as a buyer.

If you're currently living in the Gig Harbor area, and have thought of selling and moving to another nearby home, don't let the market scare you. Use the market to your advantage. What little money you may sacrifice in the sale of your current home you can more than make up for by finding a deal on a new home. If you'd like to discuss this strategy in more detail, I'd love to talk it over with you!