By Mike Bodeen · 17 March 2025
If You Need to Sell, It’s No Time To Follow the Market!
**Happy St. Patrick’s Day!**
I love, love, love corned beef and cabbage. Unfortunately, it’s sodium level limits my enjoyment. Being half Irish, I might have to settle for a Guiness instead. Mike, would that be a regular Guiness stout or a Guiness 0.0, their non-alcoholic brew? Aye laddie, a fair question it is, but I’ll keep that one tween meself and blessed St. Patty. 😉
Moving on. The Phoenix Metro residential sales market is now a full two years into the slowest home sales market since April of 2009 – 16 years. The local real estate great recession at its depth lasted from 2007-2009. That period, though similar in length, was a much deeper decline sales-wise – but we’re still in the midst.
Along with our difficult sales market, we’re now (as of this writing) watching the current sharp decline of the stock market, which we know can change on a dime, or crypto. Now, I own stock, but I’m not heavily invested. Our family has chosen to invest in rental real estate. Put your dough with what you know, right? But I do follow the stock market. I am especially cognizant of the 10-year bond market as that helps me understand the possible direction of mortgage rates. My clients (rightly) expect me to know this stuff.
I do not currently have any real estate of my own for sale. My investments are mostly for a long hold. Just like many folks follow sound advice about sticking with stocks over the long haul, short term (fix and flips) real estate and stock day trading are not for the faint of heart.
Gosh Mike, sort of a long lead in, where are you going with this dude? Off the rails?
Hang in there. Though I’m not selling any of my own real estate, my clients are. For some, it’s been a long haul. What’s a seller to do when they really need to sell? What strategies should be attempted. Can anything help?
The short answer is yes, but it could result in initial pain – aka fewer dollars, but greater dollars in the long run.
First and foremost, the property must be “show ready.” It should be in top shape, well staged, and priced according to most recent comparable (and pending) sales. Once the property is in “show ready,” condition, a follow up with professional photography is critical. Good verbiage (description) is vital also.
Next, and most important, is the pricing. In a dropping market, with few sales, (our current market) pricing should be at or below the current listed competition. In a strong seller’s market, sellers can risk leading the market with higher pricing, and the market quickly catches up. In this market, that could be a recipe for disaster.
“In a weak seller’s market, sellers who adapt more quickly with price (or similar) adjustments, will usually sell more quickly and for greater dollars than other similar listings that are too slow to make the adjustment.”
In a weak seller’s market, sellers who adapt more quickly with price (or similar) adjustments will usually sell more quickly and for greater dollars than other similar listings that are too slow to make the adjustment. Remember, in this market, sales are moving down (see chart) , which means dropping prices follow. Sellers are either leading or following the market. Followers will suffer greater losses in the long run.
How do you know when to make price adjustments? Usually, it’s based on the number of showings, offers received, and feedback from professionals who have shown the property. If there are no or few showings and offers, plus feedback is saying price is too high, then most probably the price is too high. Make an adjustment. In this era of the internet, most all buyers have seen the home online and have made a decision to see or not see the home, usually within two weeks of it coming on the market, or seeing a price change.
Price changes can be positive, because buyers shopping within those search parameters will see the change, and their opinion can all of a sudden change as to whether or not they want to see the home or make an offer on it. For sellers who have been a step behind the market, they’ve often had to take a price much less than they needed to, had they led the market. Be a leader. Looking back, you’ll be thankful you did.