Month: June 2023

What to do when you’ve gotta sell your old house first

by John Rice

I feel for people in this situation. I mean, the market is so tough right now. Even buyers who do NOT have to sell their old house before buying their next one are struggling to be competitive in multiple offers.

The odds of you finding a seller who will work with you when they have other offers without a similar contingency are equal to winning the lottery. Hoping for the best isn’t realistic. Here are some not so fun options that will ultimately end up with you getting your next home.

  1. List your house. Sell it. Pack up. Move out. Rent or stay somewhere short term until the house you want hits the market. Then buy it. This gets you where you wanted to be, the only negative is that you will end up moving twice.
  2. List your house. Sell it. Only take offers from buyers who will let you rent back after the closing. Then begin your search and only move once. Most buyers will give you maaaaybe 30-60 days after closing before they will want to be able to move into their new home. This allows you to buy something but you’re under pressure to find and close one within that time period. If you can’t, you’ll have to move out and stay somewhere short term.
  3. Only look at houses that have been on the market for more than about a week. Often these are the less desirable homes since the rush of buyers who saw it when it was a hot new listing decided they didn’t want it. The beauty of this plan is that you only move once and likely are not competing at all with other buyers. This is a good thing. A seller who only has one offer is much more likely to accept a contingency offer than one who has better choices.

So there you go. None of these are exciting. All are a lot of work. But they are real solutions to today’s real estate issues.

The single most important thing when selling your house (or anything really)

by John Rice

I did it again.

I bought another car. For people who know me, this is par for the course. I am always falling in and out of love with cars and trading them like crazy.

If you’re wondering how me getting a new car is related to real estate, it is because of pricing.

The car I bought was not expensive. It is just a little Japanese sports car that is fun to drive. A new version came out during COVID and they have been in short supply ever since. You never see one on a lot. Most are sold before they arrive. Dealers are taking deposits on them and telling people they will call when the car arrives.

I went to a Volkswagon car show with my oldest son and his girlfriend last weekend. We had lunch on the way home. They asked about the deposit I had on another one of these cars at a local dealership. I replied that I was told it should arrive later this month. He then went on a mission of finding me one that was immediately available. He found one about 250 miles away in Indiana.

He called to confirm that it was in fact in stock. It was. I remember thinking to myself “Why is this car in stock, collecting dust on a dealer’s lot when every other one is pre-sold???”

Ahhhhhh……the price!

This dealer wanted $9000 over the MSRP price.

I told the salesperson that I was definitely interested in the car but there was no way I was taking it at $9000 over MSRP. He started telling me what a hot car it was and how many calls they get on it. I am totally sure all that is true. I’m a realtor, so I know how markets for things for sale work. This is a super hot car in high demand, but the reason it hasn’t sold is that it was overpriced.

Here are some truths about any market:

  1. You cannot sell something for more than it is worth.
  2. The whole market determines the value, not just the seller.
  3. A buyer is defined as ready, willing and able. (At $9k over list for a very affordable car, that price pushed the total cost well over budget for the target buyers, thus knocking out the “Able” part of those three requirements.)

Like real estate, you cannot sell the most gorgeous $500k house in a highly sought after neighborhood for $750k. If you try, it will sit on the market and you will reduce the price until those ready, willing and able buyers think it is worth it.

But isn’t the market still hot? Yes, it is. Prices are still going up in our area. That means you still, like always, have to price a house for something a buyer will pay. A hot market doesn’t mean you can sell it for more than it is worth. It just means it will sell quickly and many buyers will want it and be eager to pay top dollar….not more than top dollar. If you ever see a house that is sitting on the market and wonder why it hasn’t sold, literally 100% of the time it is due to price. It may have some odd feature or be in bad shape, but it will definitely sell when the asking price is in line with what Buyer’s think it is worth.

So what happened with the car? They came down to $6k over MSRP and I drove up and got it yesterday. I suspect had they priced it at that from the beginning, it would have immediately sold.