In real estate, this summer feels like a return to pre-covid days…fewer buyers and fewer sellers represent a relative slowing. We take a beat to look into what’s actually driving summer pricing, given the market. In short:
Many buyers are either worn-down from a cut-throat spring season, or on that long-awaited vacation to see family and explore faraway destinations. The buyers that are still in the game this summer are either entering the market anew, or are operating under the assumption that the interest rate changes are the primary driver for pricing - assuming that homes will sell for less.
Buyers that focus on the data (not the media!) will be smart to recognize that home sales are roughly tracking with the spring season. While we are seeing a reduction in the number of offers and an increase in the number of days on the market, we are not seeing a material dip in home sale prices.
For this reason, the primary driver for pricing is the competition. Comparable recent home sales are historically a great platform for deriving a competitive offer price. But in this market, some homes are seeing only one offer - and in those cases the buyer has leverage.
Of course some homes still receive multiple offers, but we aren’t seeing the hearty gaps over the listing price that we saw in the spring. Buyers may have opportunities this summer on “sleepy” homes!
The flipside of this advice, of course, is that the single best thing that a seller can do to fetch the highest price the market will bear is to drive the competition. Multiple offers will naturally entice buyers to bring their best offers. As a seller, you want to get as many people in the door as possible.
How do we listing agents encourage multiple offers and drive competition? A properly prepared property (fully disclosed and looking great), strategic and effective marketing (including striking the right list price), and networking. We are very clear - if we deliver on all three of those fronts, buyers will feel confident about bringing their very best.
This summer season, the single thing driving pricing is not comparable recent sales data, but instead it’s the competition!