The housing market for today’s real estate investors and homeowners is not ideal, but there are ways you can still succeed.
Exactly, how can you survive and even thrive under these market conditions?
Here are 5 major tips for surviving today’s difficult market conditions if you are a seller or a buyer.
1. Don’t get emotional
The typical homeowner buys a house because it appeals to his or her emotions. It’s how that house makes them feel.
Notice the stupidity of some of the realty commercials on T.V.
“Look, Merle, there’s a swing for little Susie. I love this place. We can build a lot of memories here.”
Folks, this is dangerous.
I’m observing people buying and selling properties for all the wrong logical reasons.
That house has a great yard, or no yard, or the person grew up on that street, or it has beautiful bay windows, or it backs up to the seventeenth hole, etc.
Unless, you’re getting a great deal you’re spending way too much money. The emotional buying of housing can get very expensive.
2. Tailor your buying and selling to market conditions
Sit out the buyers’ market if you’re a seller. Wait an extra year or two until things calm down. Then sell.
You have to think and move in the opposite direction from everyone else. Don’t follow the lemmings.
Markets are slow for sellers right now in many areas. You’ve got a house to sell. You aren’t being transferred out of town and you can wait the market out if you have to. Do it.
You spot your ideal dream home for sale and you absolutely have to have it. You negotiate, or try to negotiate with the seller, who quickly figures out you want it badly.
He plays you like a tune fork.
You buy. Now you’ve got two mortgages to pay and the clock is ticking.
It takes several months to sell your house. Finally you get a bite.
That’s how not to do it.
3. Do not buy a second property until you’ve sold the first one.
This is so basic, we won’t spend a lot of time here.
If you have to take the money out of the first property to help finance the second one, sell first and then buy.
If not, the extra money will have to come out of your pocket or you’ll have to rent one of the properties out.
For some homeowners that’s a high price to pay for emotional satisfaction because you may not be too happy after all the smoke clears.
Seasoned real estate investors can take a situation like this as part of doing business. For landlords renting out a property is not the end of the world. They know what they’re doing and they know how to handle tenants.
One of the secrets here is to try for shorter leases, such as six months, so you won’t be tied down when the market does change.
If you don’t want to handle the tenants yourself, get a property management company to handle the details for you.
But get some sort of income flowing from that property. That will buy you time and time is what you really need the most right now.
4. Don’t allow buyers to hold you hostage
Avoid fussy fights with buyers who want to squeeze you dry.
Never allow anyone to get the upper hand during negotiations.
If your house or rental has been on the market too long, take it off the market for a while until a new group of buyers or tenants comes along. A stale property is ripe for discount and most buyers certainly know that.
Let’s say your buyers are a demanding little couple who insist you do major changes to the house before they will sign.
They give you their fantasy wish list which includes such things as replacing all the windows. The problem here is you think you have to take it all seriously.
If you don’t give them what they want, they’ll bolt.
A savvy real estate investor would have done the whole deal totally differently because he wouldn’t have gotten himself into such a box in the first place. He knows how important timing is.
Wait the market out.
5. Get the correct information about your current market and then act accordingly
This is something I am noticing about young people. They are doing their own research.
They’re not sitting back while realtors spoon feed vital information to them as if they’re having sparse meals of baby food.
Don’t let a realtor talk you into massive discounts if you can take the house or property off the market and sit it out.
I’m seeing houses being discounted tens of thousands of dollard or more in Nashville’s market. And we’re considered a decent market, in spite of all the problems in other parts of the country.
You must relate to the timing of the current market. Most people never learn that.
So what does it all boil down to?
Timing and emotions.
Keep your head and emotions in check.
Yes, you wish it was like Pollyanna’s Glad Town where everything is perfect and you could get your ideal price. But if it isn’t, accept the reality and change your maneuvers.
In the end, you’ll be very glad you did.