It’s funny hearing people talk about “the market” because I don’t quite know for sure what they are talking about, and more often than not- neither do they. Are they talking about the Salt Lake City market, the Utah market or the imaginary “national market” that only exists in the media.
And it’s interesting to hear people talk about good markets and bad markets. “This is such a great market” or “this market sucks!” are a couple examples. Well, what exactly is so great about it, or what makes a certain market suck? In a local real estate market like Salt Lake is in right now it depends on your price range whether it’s a buyer’s or a seller’s market, but above $300,000 it’s a buyer’s market, so what does that mean- is that great?
There are no good or bad markets because it’s all a matter of your point of view. Usually when people talk about the market being good or bad- it is from the view of the seller. Typically a “good” market means that homes are selling fast, while a “bad” market means that homes are not as easy to sell, meaning it is a buyer’s market. But if it’s a buyer’s market isn’t that good for the buyer’s? And if interest rates are really high and there isn’t much inventory plus nothing is selling then it’s probably a fantastic rental market.
Right now the Salt Lake City real estate market is going through a transition into a buyer’s market and to listen to some people it’s the end of the world. Because of higher inventory levels and tougher loan guidelines, seller’s are finding it more difficult to sell their properties, so they are frustrated.
Some of the frustration comes from people wanting the market to be like it was last year. And some of it is that so many agents got into the real estate industry during the last few years while the market was so hot (the Salt Lake Board of Realtors membership has more than doubled in the last three years) and expect that is just how the market always is, or at the very least don’t know what to do when the market doesn’t favors the sellers anymore. And much of the frustration comes from the media telling people that the market is “bad” or “slow” or whatever other headline superlatives they can dig up to create interest.
But here’s the thing- all these agents have homes for sale with all these sellers and they are all looking for buyers now. But we (my team of agents) have buyers. Because of our business model and meeting buyers through our websites, about 90% of our deals are on the buyer side. When this was a seller’s market it was easy to get buyers but tougher to get the listings. Now it’s easier to get listings (because there are so many selling and it’s impossible to sell FSBO) and the buyers are at a premium. So for us, this is a fantastic market- we love this market.
The amount of traffic to our websites is still rising and we are getting as many buyer leads now as ever. And now our clients have much more inventory to choose from and the prices are much more reasonable for them. For a buyer looking in the $400,000-$800,000 price range this is a great market. And if you are a seller that bought your home three years ago for $350,000 and now it’s worth between $490,000 and $520,000 so you sell it for $500,000 to get it sold, is this a good market because you made $150,000 or a bad market because you couldn’t sell it for $520,000?
It’s all in your point of view. Less homes are going to sell in the next twelve months so some agents think that means the market won’t be as good, but I disagree. I think if the number of sales decreases by 50% a lot fo bad agents will get out of the business and that’s a great thing. I’m not so concerned about the total number of sales in the market. As far as business is concerned- I look at it like this- whether 2000 homes or 500 homes sell next month I don’t really care. I just want to sell 20 of them- so whatever is left over is fine, I don’t need them all.