What If You Want (Or Need) To Sell In The Next 6 Months?

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The government has attempted to help the housing market during the past few years and churned out two short-term fixes, purchasing mortgage-backed securities and home buyer tax credits. But now, in September of 2010, the housing market is looking at a continued downward trend. It’s obvious that the employment challenges of many communities across the country including Long Island, are a main obstacle to any housing recovery.

Even if the government announced some incredible plan to lower taxes and cut spending and offer incentives to big and small businesses to hire employees, this still wouldn’t have any noticeable impact on the housing market in the immediate future and most likely would take 12 to 18 months before having any impact on housing demand.

So where does that leave you, the homeowner who wants (or needs) to sell in the next 6 months?

A new jobs bill will not help miraculously stabalize your home’s value. There won’t be a surge in consumer confidence in time (people need money and a stable job to feel confident enough to buy). The only solution at this point in time, is to take a step back and evaluate your circumstances, take a good hard look at your home’s value, discuss it with a professional real estate agent and price it at a number it will sell. It’s not easy, but it’s what must be done.

Many housing experts and financial gurus are saying that prices will continue to decline across the country during the next 6 months. Some of you reading this, I’ve met and I’ve been talking to you since 2007 urging you to price your home so it sells…and many of you have lost over $100,000 in equity and now you’re still telling me that “next spring” things will be better.

Spring of 2007, 2008, 2009, and 2010 have come and gone. And prices are still declining.

Supply and demand is off balance.

On Long Island there are over 30,000 homes for sale. Across Long Island, there are thousands of foreclosures waiting to come to the market. Unemployment will not improve overnight and no jobs bill will create a miracle of consumer confidence. Buyers are worried they’ll lose their job and be foreclosed on and they’re worried about taking on the investment in a home that’s going to continue declining in value over the next 6 months…1 year…2 years? Fear has clearly gotten in the way of rational thought when it comes to many buyers who have good job security, credit worthiness, and money in the bank.

So demand is a lot less than supply. When this occurs, prices soften. Last month, the Long Island real estate market saw less than 1900 homes close and 2,345 homes go into contract while the market added over 12,000 homes for sale in the 2nd quarter of 2010 for a total of 42,318 homes for sale throughout Queens(13,055), Nassau (12,521) and Suffolk (16,742).

So 1900 closings (Demand) and…42,318 homes for sale (Supply).

I don’t think there’s much else to say other than, next spring, 2011 – You’re not going to sell your home for what it was worth in 2006 or 2007 or 2008 or 2009 and not what it’s worth now in 2010.

What about 2012 or 2013? I’ve answered that question in previous articles.

Whether or not you want to stay around and make a personal decision on not moving on with your plans in life is your business. In my experience, I’ve had many homeowners tell me in 2008 that they were going to “ride it out” and that they didn’t “have to sell”. And in 2010, I sold about 5 of those homes for about 20% less than what they would have sold for in 2008. They called me and said, “I need to sell”. So we did and they are happy.

It’s easy to say you’re going to ride out rough waters, but once you’re in them, you get tired and life is too short to be tired day in and day out.

Finally, I want to leave you with this analogy. If you sell now, you’ll be selling your home while it drifts in rough waters, but you’ll be buying someone else’s home in the same rough waters. The trade is even.

If you own your other home already or you’re not intending to buy a home once you sell now, if you really want to move and do whatever it is that’s calling you, take the information I have here and think long and hard about what you want (or need) in the next 4 to 6 years. Call me. Let’s go over everything. I will strip the information down and show you the data and help you make sense of it all.

I look forward to your call. (631)831-9048.

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