A recent survey found that about a third of prospective home buyers are willing to make concessions after one year of searching for the perfect home. This coupled with a market that has less options for buyers to choose from is building the power held by the seller in a home sale scenario. It’s been reported that of the 42% of responders to the same survey that actually placed offers on homes in 2012, only 11% of those offers were accepted.
Why? Homeowners are in a position to decidedly not engage in the type of negotiating that once favored the buyer. With more buyers hitting the market than sellers after a dip in enthusiasm for sellers during the buyers’ market experienced a few years back, demand for homes is high and sellers are not as pressured to take the first offer that comes their way. In other words, sellers can be much less accommodating to buyers, and buyers either need to deal with it or move on.
Searching for a home can be a long, frustrating, and emotional process. Many that are looking to buy a home are on the cusp of a new life experience, be it an expanding family or grown children moving out of the home for their own homes, allowing one to move into a smaller abode. Many buyers have no desire to spent multiple years combing through real estate for the perfect home. Thus, the shift from sellers who are willing to negotiate to sellers who are not has resulted in a very different landscape for the buyer.
What’s the effect? Buyers are becoming more flexible. Though there was a time when repairs or less than desirable conditions within the home meant grounds for strong negotiation on the price, in today’s market, many homes are sold “as is”. Buyers are more willing than ever to take on extra work within the home at the originally stated price rather than demand the price go lower.
Buyers are also spending more than they expected to, which is also a new trend being detected in today’s market. In a recent survey 29% of responders said that they would spend more money than they had originally intended to so as to end the search for the perfect home. Buyers are also becoming less attached to their “musts” lists — the list of features that a home “must” have for the buyer to consider the home at or near the asking price. Two car garages, a quiet neighborhood street, and an indoor pool are common features that buyers start out desiring but compromise on once they find a house that suits many of their other needs.
With the power in the hands of the seller, the housing market is seeing higher prices being turned over for less than perfect properties. This means greater responsibility on the buyer to make the home perfect, alleviating the pressure on the seller.