Even though more listings are hitting the market as the prime summer selling season kicks in, an overall shortage of homes for sale remains the primary market driver behind rising home values.
On the whole, the market remained fairly robust in May. The volume of real estate sold across all Peninsula markets in May increased about 0.5% compared to May 2014, and was up 16.5% over April 2015. The supply of available inventory dropped to 0.9 months and a lack of listings continues to impede the market.
This tight inventory market often requires both buyers and sellers to act decisively and move quickly. However, moving slowly before entering the market can pay dividends later by allowing one to move quickly when it matters most.
For buyers, “moving slow to move fast,” means taking the time beforehand to think about not only what you want in a home, but what you actually need. It’s important to create a list of both “must haves” and “nice to haves.” It’s also critical to identify locations and neighborhoods that will work and eliminate those that will not in order to focus your home search and ensure you don’t miss out on any listings. Another critical, foundational step for buyers is to take the time to get their financing in order and well documented so it can accompany any offer when the time comes. The day you’re making an offer is not the day to figure out your financing.
The payoff for buyers who have done their homework is that when the right property comes along, they are able to move quickly and decisively. Unfortunately, in this competitive market, there are no guarantees of being the winning offer. However, prepared buyers dramatically increase their odds of winning and are able to make better decisions so they can move on to the next property if needed.
On the seller side of the equation, “moving slow to move fast” means keeping in mind the ultimate goal of closing day, and not getting confused with other milestones along the way such as “on market” day and “under contract” day. Oftentimes, sellers are in a rush to get their home on the market, and in this market, that is a mistake. In a tight inventory market, it is absolutely critical to take the time to get the property into a “10 out of 10” showing condition.
It can also be a mistake to take the first offer that comes along. Savvy sellers slow down and give all potential buyers enough time to bring forward their highest and best offer. By moving slowly and waiting to take all offers at an appointed day and time, a seller can increase their net proceeds by thousands or tens of thousands of dollars. Furthermore, by moving slowly during the offer period, a seller may be able to specify terms for a quick closing or a short inspection period.
In a hot market, the perception is that you have to move fast, but paradoxically, buyers and sellers alike can benefit from a little patience.