This is my column for this week from the Arizona Republic (permanent link):
If you don’t have to sell into the current Phoenix real estate market — don’t. But what if you do have to sell…?
Here’s a piece of real estate marketing advice that should be obvious: If you don’t have to sell your house right now, don’t.
If you are living in your home — or if you are an investor and you have a tenant — and you are making your payments and don’t have any exigent need to sell — sit tight.
We are probably nearing the bottom of the downturn in Phoenix, but the path to the bottom is likely to be pretty steep. If you don’t have to compete against deeply-discounted lender-owned homes, don’t.
Will the market go back up after we hit bottom? Eventually, yes. How long is eventually? It could be a long while. But prices should stabilize after the bank-owned inventory has cleared the market. What you can get for your home may not be all you want, but you won’t be facing competition priced 20% or 30% less.
But suppose you do have to move right now. You’ve taken a job out of state or you have a pressing financial need and need to tap your equity. How can you compete effectively against the lender-owned homes in your neighborhood?
The bad news is, the price pressure on you is still downward, and probably will be for longer than you can afford to wait. That means you cannot set your price above the market and hope for an offer anyway. If you price your home above the recent high sales for your floorplan — where recent means the past 60 days — your home might not show at all. There is simply too much inventory for buyers to bother with an overpriced home.
The good news is that the lender-owned homes are almost certainly trashed. Filthy, in bad repair, with overgrown lawns. Investors know those problems are easily addressed, but owner-occupants want turn-key homes.
That works to your advantage. If you are willing to put your home in turn-key condition — everything in first-rate repair, squeaky clean and staged beautifully — your home can still command a much higher price than the nearby foreclosure properties.
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