Below is the transcript for the video above.
What is a sellers market? That’s what we’re talking about today. And we’re starting right now.
Hi, I’m Pam Roberts. Team leader of the Gateway Group at Keller Williams here in San Antonio. Welcome to San Antonio Homes Insider, where we give buyer tips and selling secrets for the real estate market here in San Antonio. So if you’ve been following the real estate market lately, you’ll notice that everybody’s talking about sellers market. And what does that mean?
Sellers Market Definition
In a sellers market, it means that there’s many more buyers than there are homes for sale and that means that those that are planning to move to the area are not finding enough properties to search from. Because we’re in a sellers market, that means prices are going up. And if you’ve been searching for homes, you’ll probably noticed that. You’ve probably also noticed that houses are not staying on the market for very long.
Think about it this way. Prices always go up, very rarely do you see them go down. Sometimes they’ll level off, but you don’t see big drops in pricing. When you have an increase it’s going to maintain.
Top reason to SELL Now
Probably the number one reason for taking advantage of the sellers market is to get your equity now. That means if you want to upgrade to a new home or to build a property, you can take the money that you’ve made on the house that you’ve been in to use towards your new house. Also, during COVID a lot of people have decided that their house doesn’t fit them anymore. Either they need more space to work from home or they have their children and they need to have more play area, or they need to have a designated area for another family member that might be living with them. So those are all things to consider when it’s time to sell your home.
The summertime is typically when we see the most activity in home searches. That doesn’t mean you can’t sell at other times of the year, but you’re actually going to get more buyers looking, that means more competition and a higher price for you as a seller. In a sellers market, you’re not going to have to offer nearly as many concessions when it comes to the contract. That means repair negotiations. That means possibly even concessions to the buyer for closing costs, that sort of thing. It actually means it’s a lot easier for you to sell without a lot of strings. Another advantage to selling in a sellers market is that you’re going to sell fast. That means there’s potentially cash buyers or buyers that are ready to close quickly because they want to be first in line to buy your house. Because Texas is so affordable, we have many buyers moving from out of state into Texas, many from the East Coast or the West Coast.
And what that means is they have lots of money to spend. They have come from an area that’s a lot more expensive and so they may have sold a much more expensive property and they are going to be potentially using cash to buy the home. So you want to take advantage of those buyers while they’re in the marketplace. If you want to know more about why now is a good time to sell your house, we did a video about that just a little while ago. So I’m going to put a link to that video right up above, make sure you reach out and look at that video next.
Using your SELLERs leverage
Another advantage or leverage that you have as a seller in today’s market is that you’re in the driver’s seat. That means if you want to have a little bit more time for closing because you haven’t found your next house yet, a lot of times buyers will wait just so that they can get into your house. So it gives you a lot more flexibility when it comes to your move date. So don’t be afraid to put your house on the market now because there’s going to be some negotiations down the road so that you can move when you’re ready. If you’re finding this information helpful, don’t forget to subscribe and ring the little bell so that you’ll be notified when we bring new information like this just about every week.
Shifting Stats and DOM (Days on Market)
Now I’m going to quickly share what it actually means as far as days on market and how that has changed over the last year. In this example we’re using Stone Oak four zip codes that are in and around San Antonio in the north east area. In a typical balanced market we have six months of supply of inventory and you’ll notice in 2020 last year in May, we had less than three months of inventory. That’s less than half of a balanced market and now we’re down to less than a month of inventory in 2021. When it comes to typical days on market, it’s also changing and decreasing. We went from 69 days in 2020 down to 33 days in 2021.
Now let’s take a look at those same stats for June. In 2020, we had 2.5 months of supply, and now we’re down to 1.08. So very similar statistics. And in addition, the days on market have gone from 30 days on market down to 14 and that’s a reflection of the cash buyers in the marketplace because it typically takes 30 days to close on a conventional FHA or other type of loan from a mortgage company.
Preparing your house for sale
Does that mean that you really don’t have to consider what kind of condition your house is in? Not really. If you want top dollar, you still want to get your home prepared, and I’m going to show you a video right up here that talks about how to prepare your house for sale. And I’d take a look at that if you’re thinking about selling now. The reason you want to take care of these little details is because your house might be down the street from another house that is prepared and they’re going to get more offers or they might be more attractive offers if they’ve already put that time into preparing the house, getting it clean, doing a little touch-ups or other maintenance issues that have been avoided. So don’t forget to get your house ready before you put it on the market because you will get more money if you prepare your house.
Appraisals and The CMA
Lastly, I want to take just a moment to talk about appraisals. There’s two different types of appraisals. There’s your tax appraisal, and there’s home value appraisal. And they’re two totally different things. You are tax assessed based on the tax appraisal and usually that’s significantly less than what your house value is. As real estate agents, we provide what’s called a CMA or consumer market analysis, and that is based on your neighborhood and houses that are most similar to yours and what they sold for in the past six months. And we also look at what the trend is because the appraisals that are done by the appraiser are actually not keeping up with what’s happening in the marketplace.
So we actually look at what’s sold, what is for sale now and what is under contract. And we look at the price per square foot and how that has been trending. And that’s how we determine what your suggested list price should be. In general, San Antonio is a very affordable place to live. And so people that are planning to move to Texas often look to San Antonio to find out what is available here as compared to Dallas or Houston or Austin. So if your goal is to take advantage of today’s sellers market, then reach out to us today and we’d be happy to help you. We hope you found this information about what is a sellers market very helpful. As always, have a great day.