- Flexible – Don’t lock yourself into one price; be ready to adjust to the market.
- Reasonable – Have realistic expectations, and have a price range.
- Accountable – Communicate your requirements upfront.
- Negotiable – Be prepared to negotiate price and terms (i.e. closing date, contingencies).
Daily, I continue to see conflicting reports about trends in the market. This must be confusing to you, a prospective seller or buyer. And, even more importantly, if you are considering a move, what should you do? I think the best advice is to view the reports with a great deal of skepticism and then look closely at your finances and what you can afford to pay for an apartment or what the bottom line is if you are selling. Then, talk to a knowledgeable, savvy, real estate broker to get the lay of the land. Buyers need to find out what is available and sellers should get an estimate of the value of your apartment.
It might be helpful if you review Fran’s Law, several selling principles for successful deals. The same approach is also helpful for buyers.
What I See
The one prevailing fact I see daily is that we are in a buyer’s market, with flexible prices. Overheated prices of recent years have tempered and we have returned to a period of down-to-earth values. There is more product hitting the market these days, though supply and demand are fairly well balanced — a positive sign. Buyers know this and unless there are extenuating circumstances will not overpay. Sellers need patience. Apartments no longer fly off the shelves with three bids above the asking price coming after the first open house. Today’s sales take longer, and require flexibility and more negotiating.
Navigating the Buyer’s Market
The burden in a buyer’s market is on the seller to price the apartment realistically. Key to this is managing the seller’s expectations. Sure, it is possible to point to an article that says prices are up in double-digits for high-end apartments and then expect the same for the one-bedroom apartment you want to sell. This type of thinking, however, hinders a sale. Buyers in recent years have become more sophisticated and with the Internet do their homework and have brokers who educate them as well, so they come armed with market reports and price per square foot statistics. That’s why it is important that the broker obtain actual sale prices for the prior three months (a more relevant comparison than six months) for comparable apartments in terms of size, quality of building and location.
Among factors that come into play in pricing an apartment are location, condition, quality of the building, view and the monthly charges. Based on these, the broker and seller agree on a price.
This also applies to the appearance of the apartment, a key selling point. Though the seller may be in love with antique furniture from their grandmother, there may be too much of it, or the paint is too dark and makes the apartment dreary. A knowledgeable broker knows how to “stage” the apartment to show it in the best light. Listen to the broker and be ready to make a small investment and take the time to make the changes that can have a significant impact on price and selling time.
Which, brings us to a the final point. Patience. For a multitude of reasons, apartments are taking longer to sell. Don’t get frustrated and, again, listen to your broker who has his or her ear to the ground and knows what is happening in the market. If the broker sees that the apartment is priced too high, listen to the reasons for lowering the price. It will probably make the difference between selling the apartment and not selling it.
The price hysteria of recent years is over, but by following “Fran’s Law” and working with a good broker, an apartment can still be sold at a very good price. Much more than you would have expected five years ago.