Accept the market was overpriced – the market is not falling from fundamental value, it is falling to fundamental value. When you accept the market was overvalued, the downturn becomes less painful and the next decision becomes easier to make. Waiting for prices to return to fresh highs means you won’t be selling in 2019, or 2020 for that matter.
Accept the market conditions – in a downturn, some properties manage to sell above the market price. Those that do so are simply fortunate. The vendor that fails to accept the market conditions and rails against reality, ultimately sells for less. Patience is a virtue, stubbornness is not. Knowing where the transition line is – this can be difficult to ascertain. Some campaigns require patience, but if you are on the market for well above the suburb’s average timeframe, maybe patience is not the issue.
Accept inaction is feedback – if the agent has run a good campaign and the buyers are not engaging and/or making offers, then the inaction is feedback. Blaming the agent is easy, it offers short term relief but it seldom changes the challenge at hand. Make it easy for the agent to tell you exactly what it is happening and what you need to know. An interested buyer is easy to identify, they are clearly interested. Therefore, a disinterested buyer is easy to spot too, they are obviously disinterested. If the market at large is disinterested, the pricing strategy could be wrong.
Accept the agent’s guidance – markets can turn quickly. The agent may assess the value of your home at $1 million, but by the time you list on market, it could be $975,000. Contrary to how agents are perceived by some, agents like to achieve a high price for their clients. However, it’s no good if the agent is trying to achieve a high price for you whilst the market drops below them. If the agent detects a change in market conditions, accept their guidance if it seems credible. In the third quarter of 2018, property prices deteriorated rapidly. Even more rapidly that what occurred during the GFC in 2008. Those that accepted their agent’s guidance probably sold for more than those that resisted the advice.
Accept the best offer – it’s simple advice, but it’s not as easy to get right when prices are falling. You only know what the highest price is at the end of the campaign. The greatest tragedy when selling real estate is not selling for less than you wanted, it’s selling for less than you previously rejected. If you need or really want to sell in 2019, it’s imperative that you identify the best buyer and sell to them. There are two huge points in achieving this simple goal. Firstly, the high quoting agent at the time of listing can blind you to reality during the actual campaign. Secondly, the best offers tend to come early in the campaign.
by Peter O’Malley
Author of Inside Real Estate