The 4 biggest challenges facing home sellers in today’s market
Understanding and preparing for the obstacles you may face as a home seller in today’s housing market is not only smart — it’s essential. From arranging somewhere else to go once your home is sold to actually finding a qualified buyer, selling a home is not for the faint of heart.
I’m a Real Estate Agent: Buy Properties in These 5 Countries and Get Rich in 10 Years
Housing Market 2023: These 15 cities are poised for the most stable growth and are likely to maintain their value
Here are the four biggest challenges facing home sellers in today’s market, according to experts.
Finding another home to move to can be difficult
“Although low inventory allows homes to sell very quickly in most cases, it can make it very difficult to find a place to go within a reasonable amount of time,” said Realtor Dalina Adams of Century 21 Legacy. “Our market has remained highly competitive even with interest rates increasing, so when our sellers become buyers, they are in a rush to find a place to go before closing on the sale of their current home.”
“Some ways to ease the stress of making a move once you sell are to ask your agent to help you find a place to go — whether it’s a permanent home or a short-term rental — before putting your home on the market,” Adams said. “They can also reach out to local lenders to see which ones offer a bridge loan to cover the purchase of another property while they wait to close on the home they are selling.
“If these options are not possible, they can always discuss the option of a temporary occupancy agreement with any potential buyer before accepting an offer. A temporary occupancy agreement will give sellers the option to essentially rent the home from buyers after closing while they find another property (this period typically ranges from 30- 60 days depending on the situation).
Real estate agents say: Buy real estate in these 5 states and get rich in 5 years
The contract may not be strong and reliable
“While worrying about where they should go is always an issue, sellers also face the issue of whether the contract is actually strong and reliable,” Adams said. “Most agents these days ask for proof of funds with any offer. This proof can come in the form of a pre-approval letter, a bank letter stating cash is available or a contract on their current home.
“It is always important when reviewing proposals to look at the facts and verify them before moving forward,” Adams said. “Look at how thorough the lender is during the pre-approval process, what contingencies they require, and how strong the current contract on the buyers home is? Although there is never a guarantee that the contract will close, there are certainly plenty of ways to protect sellers to get the best offer.” As stable as possible.While the offer amount is obviously important, it is also important to understand the likelihood of that offer reaching the closing table.
More concessions must be made to the buyer
“It’s always a good time to sell, as there will always be people in need of homes,” said Christina McCollum, regional director of Churchill Mortgage Bank, based in Washington. “However, the seller may not have the control they once had just a few years ago when the market was very hot, so we are seeing more and more concessions that favor the buyer. Despite this shift in the balance of power, you should still sell when And if you have to, because real estate is always in demand.
“If you’re ready to sell, give it your best shot,” McCollum said. “Clean and tidy homes sell faster. Get a professional to stage and sell. Consider contingent offers, as buyers need to sell, too. Understand that you probably won’t have as much control as you’d like, but you can still get a fair deal.”
It can be difficult to find qualified buyers
Martin Orefice, CEO of Rent to Own Atlanta, said it can be difficult to find qualified, interested buyers in today’s market. “Stubbornly high interest rates have created a situation where even buyers with good credit and a large down payment saved simply cannot afford the long-term borrowing costs that come with a mortgage at today’s interest rates,” he said.
A rent-to-own agreement could be a solution, Orifici said. If you go that route, the buyer would need to pay a lump sum of 1% to 5% of the home’s value to get the option to buy the property, he said. He also said they would need to make monthly payments for years to pay off the property. “Since there are no formal loans, you can end up paying much lower borrowing costs, even when interest rates are high.”
More from GOBankingRates
This article originally appeared on GOBankingRates.com: 4 Biggest Challenges Facing Home Sellers in Today’s Market