Our last post tackled the question of whether it's a buyers' or a sellers' market, and we concluded that it's neither. Here in SWFL, uncertainty about the future of inflation, the economy, mortgage rates, and more have seized up the market - and wrenched power away from buyers and sellers alike.
Here in Collier County, would-be home buyers and some of their real estate agents - and even some on the seller’s side - deeply fatigued with what feels like a merciless housing market. Inventory is up, sales are down, but amazingly the average sale price is still up. That combination can make both selling and buying are so difficult that even though some people might keep searching, they’ve lost their enthusiasm, wondering whether this particular slice of paradise might remain out of reach or - even if they do succeed - might require painful sacrifices or be a far cry from the ideal scenario they’d imagined.
Nobody’s Market
Today things have become so challenging that even sellers are struggling, because, let's face it, most sellers in this area are listing their houses to try and move up to a better location, bigger house, or both. As we said in our last post, this market could be better characterized as a “nobody’s market.”
People feel like the market isn’t working for anyone, contributing to everyone’s sense of fatigue.
There is data to back up this claim. A monthly survey from Fannie Mae found that in February, only 17% of respondents thought now was a good time to buy, while 82% said it was a bad time to buy. Some 59% of respondents did say it was a good time to sell, but that's still 41% who say it's not a good time.
It's disappointing to look for a home and not be able to find anything you like that's affordable. It's also very disappointing to put your home on the market to try to move up in the area and find it won't sell for what you thought it would. It's especially frustrating to be outbid on a home you like or, worse, multiple homes. It’s like being rejected for one date after another, and just like being rejected on a date, you can start to take it personally.
It can even be frustrating for some buyer agents, who need to close deals to both satisfy their clients and make a living. Sometimes agents are submitting offers they know give their buyer(s) no chance, but as the agent, they need to follow their clients' instructions.
And for one final bit of frustration for both buyers and sellers, inflation surged a year and a half ago, forcing the Fed to raise interest rates. Then, just when they’d started to get into the swing of bidding competitively, mortgage rates surged, knocking buyers down the ladder in terms of affordability. Now they make the same monthly mortgage payment for properties that aren’t as good. And for sellers, higher mortgage rates affect how much buyers will be willing and/or able to pay for their houses.
A real estate agent's job has always been to get the best deal for their buyer or seller, but in this no-man's land of high interest rates, you need an experienced agent to help you now more than ever.
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