Monday, March 24, 2008
North Bethesda real estate market
The market for detached houses has fallen into two categories; houses that are in good condition and are priced appropriately for this market (more about this below), and those whose owners are trying to recapture prices from a year or two ago. The first group is selling. The second group will linger on the market as buyers check them out, either in person or online, then reject them at the current prices. Buyers are actively looking at homes; I am having excellent "traffic" in open houses this spring. Yesterday, at an open house on Pooks Hill Road, several buyers told me that, although they had been thinking about buying for some time, they were getting more serious now that interest rates are dipping. No one knows if prices will stabilize or decline a bit further, but the threat of an interest rate increase in future months may cause some buyers who had been on the fence to commit to making an offer. As to the offers themselves, most buyers will make a very low first offer to test what the "floor" is for the sellers. Sellers should not be angered by this; in the buyers' position , they would likely do the same thing. The critical matter is the intent of the two parties. If the buyer is looking for a particular type of property at a reasonable price, then a house that meets those criteria will be attractive to that buyer and a proper price can be negotiated. Buyers whose main goal is to find a true, outright bargain in this market will continue to make serial offers on multiple properties until they find the seller who will take a particularly low price. For the sellers, the most successful tactic is to evaluate the current competition, the active listings that are similar to their home that a typical buyer would view before making a choice. Then, the sellers can set an asking price that will communicate to the buyers that "this house is a better buy today than the other ones you are looking at." This should be done with consultation with a really experienced Realtor who has success in selling properties in a slower market. Choosing an asking price based on the comparable sales of a year ago will not bring a buyer today. Buyers will only check comparables after they have selected a property. They will choose the property to make an offer on based on the current inventory, then check comparables as one of the tools to determine the price to offer. The newer listings, priced propertly, are actually selling within 45-75 days of coming on the market. Properties that are perceived by buyers' agents and buyers to be overpriced for what they offer (against other active listings) will linger for 12-200+ days on the market. The average days on market for detached houses in the Montrose/Old Georgetown wedge area is changing: Sold homes (these have gone to settlement and, therefore, were likely to have started on the market in the fall/winter of 2007) average 91 days, Currently Under Contract (these are the most recent spring 2008 sales) average 57 days on the market.