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I think the increased buyer activity may be due to the impending rise in mortgage rates.
I agree, the anticipated rise in interest rates most likely has had an impact on the increase of home purchases; combination of lower prices and low interest rates is bringing hold-outs back to the market.
Sellers look at "price". Buyers (should) look at "cost" or monthly payments; a 1% increase in interest rates equals a little more than a 10% difference in purchase price.
Example:
$400,000 mortgage with a 3.75% interest rate = monthly principal and interest of $1,852.46
$355,000 mortgage with a 4.75% interest rate = monthly principal and interest of $1,851.85
Bottom line: higher interest rates equal less house or a higher down payment
Lots of first time home buyers out there, and they're more informed than ever.
In addition, the requirements/rules for FHA loans are getting tougher/more expensive as of April 1st, which possibly has also had an impact.
too many people seeking to flee and expecting the buyers to plunk down a big wad of cash and fully fund their southern McMansion. Yeah, that was the trend in the past, but now more of them are going to have to consider a mortgage ... .
It's amazing how stupid people can be when they move....especially if it's to get a better QOL. We know people here who overbought and probably have mortgages close to what they had up north, only difference is taxes are much lower and don't go up all the time. But what's the point?! We know one family from LI who came down and bought a huge house around the same time we moved here. They paid over $100K more than we did (although their prior trajectory seems similar to ours) and have tried to sell it twice since they moved here! I just don't get it.
Glad you got that extra $100,000! What a huge difference! Doing your homework paid off handsomely.
Just as an FYI, this amount gets split between the listing broker and the selling broker, who in turn split it with their respective agents; so on average, the selling agent gets 1/4 of that amount before expenses, or expressed differently, about 1% of the selling price.
Thanks. Your explanation highlights the fact that it can be very difficult for a seller to accept a lower price when he/she has to shoulder 95% of the price reduction and the agent might only lose 1% of the difference. It can be especially hard if the seller has come up with legitimate comps that justify a higher price.
As I may have explained on other threads, we interviewed agents who were coming up with clearly unsuitable comps and wanted us to list about $100,000 lower than we did. Then, during negotiations on two different offers at two different times, our own seller's agent was urging us to take $100,000 less than our bottom price. We were also getting a decent amount of traffic so we always felt a good buyer would come along. "You'll never get a better offer," we were told. Well, we did.
Your note about buyer activity and our own sense of the market as we look for homes indicates that we were right on the mark in holding out for a better price. I think the sad part is that we could not find a single real estate agent who shared our view during our selling process.
Having a problem selling a house in Melville. No offers and its been over 30 days. We dropped price twice in that time and now placed "range pricing" as the listing price. Any ideas would be helpful.
Having a problem selling a house in Melville. No offers and its been over 30 days. We dropped price twice in that time and now placed "range pricing" as the listing price. Any ideas would be helpful.
- are you at least getting some traffic through the door?
- what do comps say?
- is it near a transformer or other unsightly/undesirable object?
- what school district (if HHH - shouldn't have any problems)?
Having a problem selling a house in Melville. No offers and its been over 30 days. We dropped price twice in that time and now placed "range pricing" as the listing price. Any ideas would be helpful.
You need to give us more detail on the pluses and minuses of the house, as well as how your agent is marketing the place (everything from whether the photos are good to whether there's a floor plan shown to whether the agent is highlighting all the positives). Agents will be the first people to tell you that a price drop is the solution when it may be the crappy, dark and out-of-focus pictures they've put on the listing. For example, if your home is nice and affordable and in a good location, it might be a great place for someone who has been newly hired for Canon or who has been transferred to their headquarters from another location.
Having a problem selling a house in Melville. No offers and its been over 30 days. We dropped price twice in that time and now placed "range pricing" as the listing price. Any ideas would be helpful.
How many showings have there been? Was there an Open House? (I know, people say nobody buys a house as a result of seeing it during an Open House--well, I did, so I know it can happen)
Anyway, traffic is important - the more people get to see it, the better your chances of getting an offer.
We don't know enough about the "problem" with the lack of information in your post
Having a problem selling a house in Melville. No offers and its been over 30 days. We dropped price twice in that time and now placed "range pricing" as the listing price. Any ideas would be helpful.
30 days and you are panicking already??? It took us 8 months to find a buyer! This is still not a seller's market despite what some people here are saying. The spring season will be more active for sure, but you are expecting the world to have an offer so quickly.
I ignored any house with "range pricing" when I was looking. It's annoying that I put in a price in the MLS and there's some seller and their shady RE agent really trying to get 50K more than I want to pay thinking they can dupe me.
I also heard "the seller won't accept anything under $450, not a penny!!! " from multiple agents at open houses....every house sold for at least $30K less than that as per MLS.
Do these silly part time house fraus think they are slick or something? I could barely contain my eye rolls at these open houses.
we have been looking to move for 2 years. in the last 3-4 months, we have put offers in on several houses. At least 4 of them were multiple bid offers and we lost each of them. We even went over asking by 20k on one of them and still lost the house! We are in contract on our house, have no outstanding debt, other than our current mortgage, and have credit scores in the low 800's so we are good, pre-approved buyers.
the house we are going to buy (finally!) was listed on wed, 5/1. i saw it on fri, 5/3 and immediately made an offer- a decent offer at 95% of the asking price. we were told that there were several showings already scheduled for the weekend and that the sellers wanted to show the house. my realtor said don't worry and that we would be notified sunday night about a counteroffer. On sat, 5/4 my realtor called and said there were 3 other offers already on the house. the sellers were looking for final/best and would decide sunday night. we went back to the house sun 5/5 in the morning, still loved it and upped our offer to 5k over the asking price and wrote a house "love letter". I saw it on "The Good Wife" and thought it couldn't hurt!
sunday night our realtor tells us that there were 5 other offers in on the house, our inital offer-at 95% of the asking price- was the lowest of the 6 offers! but the sellers narrowed it down to us (now at 5k over the asking price) and 1 other offer. they decided to go with us! turns out, the other offer was initally at the asking price and then raised to 5k over the asking price, just like our offer. i had the house inspected on tues, 5/7. the sellers said the 2 offers were so close, but it was my letter that made the difference. actually the husband was inclined to go with the other offer as their initial offer was at full price. but the wife couldnt walk away from my "love letter".
you think its a buyers market. I know thats what I had been thinking. but there isnt alot of inventory and it seems that this is the issue. and when a good house comes for sale, it's like a cabbage patch doll rush! I have bought and sold 5 houses in the last 15 years and it was never this hard. I never had to fight off other buyers. I've never been in a bidding war before- prior to the last few months.
anyway, contracts were just signed and we are closing this summer...... i think my moving days will be far behind me once this move is complete. at least for 10 years.......
good luck!
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What a huge difference! Doing your homework paid off handsomely.
I could barely contain my eye rolls at these open houses.
