The real estate market is already in full “spring,” with many homeowners inspired to change their address during this time of year. In most markets, real estate’s busy season kicks off in March and extends through late August, right before the new school year. A combination of pleasant weather, families’ desire to move at the end of a school year, and more housing inventory make spring and summer a popular time for both home buying and selling, but also increases competition all around. Because the stakes are high this season, we’re giving you tips to keep in mind whether you’re buying a home, selling a house, or doing both at the same time!
The Current State of the Market
If you keep tabs on the real estate landscape, you’ve probably heard about the current low mortgage rates and growing inventory of homes on the market. This combination shifts the market in favor of home buyers as we get into the thick of the spring season.
Job growth and a strong economy have also given individuals more buying power; this power, coupled with low mortgage rates, boosts confidence when it comes to buying a home. Keep in mind, mortgage rates are reasonable but fluctuate week by week, so you may want to jump on the opportunity to purchase sooner rather than later.
When it comes to home prices, we’re seeing less growth than we did in 2018, with increases at a six and a half year low. Although prices continue to steadily go up, they’re doing so at a lower rate than in past years, making the purchase of a home more affordable. In fact, our most recent Knock Deals Forecast found that 72% of homes sold below their original list price in Q1 2019, and predicts that number will increase to 75% in Q2, yet another reason to consider making a move now.
Although the overall state of the housing market is shifting more in favor of buyers, spring proves to be an advantageous time for sellers as well. With so many people on the house hunt, you may just see more and better offers coming your way than if you’d listed in the winter.
Home Buying Tips
Now that we’ve covered the technicalities, let’s talk tips! Whether you’ve bought a dozen homes in the past or are just starting out, these pieces of home buying advice from Knock’s local experts can help you secure the home of your dreams this season.
All of us have some level of competitiveness, some more than others. But, when it comes to buying your next home in the popular spring season, you might need to let your competitive side shine through in order to win. What exactly does that mean? In many cases, a higher offer. When the buyer’s market is hot, many potential buyers may be interested in the same home, with some being sold the same day they’re listed! If you really love a house enough to commit, make an offer the seller can’t refuse, and keep other potential offers in mind.
“Spring is here so the market is now more competitive and many homes will have multiple offers. This means in order to have the advantage and win the home of your dreams, you may have to submit an offer higher than the list price.”-Francine Bethune, Knock Licensed Local Expert, Atlanta
FYI: Luckily, with the Knock Home Trade-In program, we put an all-cash offer in on your new home to help win bidding wars and even get a potential discount off of the list price (on average 3%-5%).
Although competition is fierce, you should still be able to negotiate in order to get a fair deal. Remember, buyers have an advantage in the current market, and as our Forecast predicted, many homes will sell below their original list price. In fact, our Knock Deals Forecast data shows that in Q1 of this year, nearly 60% of homes sold at a discount of 2% or more.
“When buying during the spring selling frenzy, it’s more important than ever to find a licensed agent who’s an expert negotiator in your local market. Homes are moving quickly so time is of the essence. Once you find the house with the features that are most important to you, they can help you put in a strong but fair offer in as soon as possible.”– Christy Narsi, Knock Licensed Local Expert, Phoenix
FYI: Knock provides you with an entire team of professionals who specialize in the various phases of the home buying and selling process, including Licensed Local Experts who are agents familiar with their specific markets and the current home price trends in those areas. With a full team behind you, these agents can focus on what they do best: Getting you an awesome deal. Their expertise helps you gain knowledge about your neighborhood, comparable homes on the market, and the offers you should submit.
Be Prepared Before Going on the House Hunt
We’re already in the midst of the spring buying season, but before you set out on a hunt for your new home, be prepared. In order to make a serious offer on a house, you’ll have to prove you can actually afford it. With houses getting bought quickly in spring, come equipped with everything you need to make an offer as a strong, pre-approved buyer. Don’t know where to start? Check out our Q&A with Better Mortgage on the topic of Verified Pre-Approval to learn about the minimum requirements for obtaining a mortgage, and the documents you’ll need to get pre-approved.
Before you start your search for a new home, you should also have a wishlist in mind. Prioritize what you need (i.e. the number of bedrooms and bathrooms) and think about what you want (i.e. granite countertops or a finished basement) so you can narrow down your options quicker. If you’re indecisive about what’s important to you in a house, you’ll keep missing out on the potential home of your dreams. Plus, knowing what you’re looking for ahead of time allows you to take action as soon as something great catches your eye.
FYI: One of the first steps on the home buying side of the Knock Home Trade-In process is helping you get pre-approved for your new mortgage. After gaining an understanding of your priorities for your new home, we also help you set up alerts through our Knock Deals home search tool that not only show you homes that match your criteria, but give you insights into how much the house will sell for and when, as well as when price drops occur, so you can swoop in and grab the deal.
Home Selling Tips
Thinking about putting a “For Sale” sign in front of your home? Before you do, here are some things to consider that will help your home sell quicker and for a higher profit.
Curb Appeal Counts
The age-old phrase warns us not to judge a book by its cover, but when it comes to homes, it’s hard not to. A first impression is everything to a potential buyer, and you should strive to show your home in its best light, starting with the exterior. Major upgrades, including new siding and exterior add-ons (porches, decks, roofs, for example), may be necessary if your home has experienced wear and tear. But, if your house is already in great shape structurally, you might just need some minor preparations, like power washing and landscaping. Even the slightest change, like repainting your front door, can make a huge difference, leading to the potential of more money in your pocket.
“Curb appeal can make big impact on a home’s value. Sellers can easily help draw in more buyers with small, inexpensive improvements. Sprucing up your home’s landscaping with some simple items such as flowers and mulch, and clearing out weeds can be a cost effective way to increase your home’s chance of selling quicker and for a higher price. It’s also a good way to work as a family together outdoors in the beautiful weather this time of year.”– Chris Menegay, Knock Licensed Local Expert, Dallas-Fort Worth
FYI: Did you know that Knock advances up to $10,000 that you can use on preparations for your home before listing? Our team of experts will assess your house and give you suggestions on what to update in order to get the best ROI. Then, we’ll get the work scheduled and executed after you’ve moved out, so you don’t have to deal with the hassle!
Spring Sprucing is Key
You want potential home buyers to envision themselves living in your house, right? The last thing they want to see are your personal items and lived-in clutter! Clearing out your space and giving it a deep clean is a surefire way to make tourers feel, well, at home.
Start by packing up the items you don’t need in your everyday life, like family photos and home decor. The more you can get into boxes and out of the home, the better! Don’t forget to dust, scrub, and mop the place to give it a fresh feel. If you have pets, eliminate any odors that may be lingering. If you have kids, get rid of the toys that take up space (and could cause a safety hazard!). You might even decide to stage your home to give buyers an idea of your house’s design potential.
“You want your house to stand out from the crowd to attract a bigger pool of buyers. Spring cleaning is your friend! Begin packing, clear the clutter, and freshen up the inside and outside of your home to appeal to a wide range of potential buyers.”– Montana Aydlett, Knock Licensed Local Expert, Charlotte
FYI: The beauty of the Knock Home Trade-In is that you move into your new home before the old one sells. That means you can fully move your belongings out of your old space, leaving it a blank canvas for potential buyers. As mentioned above, Knock will help you coordinate and execute home prep and cleaning to get your place into its best shape. Learn more about the process from our Listings Manager Justyne, who coordinates home prep and listing for Knock customers!
Be Strategic About Pricing
Of course, you want to sell your home for a great price, but you should also be reasonable when it comes to determining what you list it for. The most common reason a house stays on the market for an extended period of time is overpricing. Our Q2 Forecast took a look at the rate of deals (homes selling below their original price) by market in Q1, and made predictions for this quarter. The data revealed that certain areas of the country see a higher rate of home discounts than others, proving that buyers aren’t willing to pay the original list price in those areas.
Our newest market Phoenix was in the Top 10 list of deals in our Q2 Forecast, with 80.33% of homes there expected to sell below list price this quarter. Clearly, with such a large percentage of houses being discounted, original asking prices are too high for potential buyers, forcing sellers to go lower. Conversely Raleigh was ranked the 13th most competitive market for deals, showing that homes there are priced more fairly.
If you put an overly high price tag on your home when it’s listed, you risk scaring away potential buyers, and will deal with your house being on the market for much longer than you planned. This can actually result in your home being sold for even less than it would have if it had been priced at its current market value from day one. For example, 92% of Phoenix homes that sold in Q1 2019 that had been on the market for two months or more sold below their original list prices, according to our Forecast. Over half of these homes sold at a discount of 5% or more – meaning at least $12,500 off the sale price on a $250,000 home! That doesn’t even account for the time, money and stress that comes from waiting months for a home to sell. We all want to get the highest price, but you don’t want to become your own worst enemy by asking too much.
FYI: At Knock, we use a high-touch, high-tech approach to pricing your home, incorporating a variety of factors to determine what the list price should be in order to avoid discounting and extended days on market. To do so, we have a dedicated team of data scientists, home valuation specialists, and local real estate experts that help value your house and determine the necessary days on market to sell it. We also have a proprietary algorithm that incorporates current homes for sale, recent transactions in your neighborhood, and our 200-point on-site inspection to ensure any improvements and unique features of your home are used to price it accurately!
It’s Time to Spring into Action!
The busy spring real estate season is in full swing, and whether you’re buying a home, selling a house, or doing both at once, these tips can give you an advantage in an otherwise competitive market. When it comes to buying a new home, be prepared to negotiate, but remain competitive with your offer in order to secure your dream home. When selling, getting your house in top shape will help you attract more interest. Simple upgrades like landscaping and clearing your clutter can make a noticable difference. Above all, finding that sweet spot for pricing right at the start will make all the difference.
When it comes to buying and selling this season, Knock can help you at both ends of the spectrum. Our Home Trade-In program was designed to make the entire real estate process easier for you as both a buyer and a seller. With our all-cash offer on your new home, we help you beat out the springtime competition so you can move into your new home as soon as possible. As for your old home, we have the team and resources to get it market ready in order to get you the best price – all while you’re already living in your new one.
Interested in our Home Trade-In program?