Top Real Estate Tricks to Get a Fair Deal in 2023
To get a fair real estate deal in the challenging 2023 market, with economic uncertainty, and varying local market conditions in your city and location, is not an easy task. Whether you are buying or selling a property, you are likely to get immersed in unsolicited advice and tips.
Irrespective of the state of the property market, it is important that you pay a fair price when you buy and get one as a seller. But how do you know that you are getting a fair deal in a tight market before you quote a price or make an offer? You need to know how to evaluate the price of any property so that you can make a sound investment decision. You may find it disorienting somewhat, as high inflation takes its toll and interest rates rise and this could mean changes to your buying or selling strategy.
Here are a few tips that will enable you to get a fair real estate deal in 2023.
Property Buying Tips
Compare with Recently Sold Properties
Compare the property you intend to buy with a ‘comparable property’ which is similar in quality of construction, size, condition, neighborhood, and amenities. This will give you valuable information about its pricing in comparison to similar properties. A good real estate agent can be the best source of accurate, up-to-date information on ‘Comps” or comparable properties and those currently in ‘Escrow’- i.e. the property has a buyer, but the sale has not been completed.
Visit the Comparable Properties on the Market
Visit the comparable properties to get a tactile sense of how their size, condition, and amenities compare with the property you’re considering. You can then compare prices and fix a fair price for yours. If you want to be competitive, you must price your property similarly to the market comparables.
Consider the Unsold Comparables Properties
If the property you intend to buy is priced similarly to that taken off the market as it remained unsold, the property you are considering may be overpriced. If there are many similar vacant properties in the market, the price should be lower. The unsold inventory index for information about current supply and demand in the real estate market should also guide you. It estimates the time taken for all the properties, currently listed in the market to be sold, at the rate at which they are selling currently.
Consider the Current Market Conditions
Considering the recent market trends in prices, it is important to evaluate the impact of various factors on property values. Properties in a sellers’ market may be slightly overpriced, whereas those in a buyers’ market could be somewhat underpriced. However, this assessment also depends on where the market stands on the real estate boom-and-bust curve.
In relation to house designs with sloped roofs and staircases, it is crucial to ensure their relevance within the context of current market conditions. Factors such as mortgage interest rates and job market stability play a significant role in assessing overall economic health and its potential effect on property pricing dynamics.
Negotiate on FSBO Properties
A For-Sale-By-Owner (FSBO) property is likely to be overpriced as the seller may not have professional guidance while setting the price. Moreover, since the brokerage is not included, its price can be negotiated by about 2% to 3%.
Consider the Appreciation Prospects
The future prospects of a property location may have an impact on its price. Positive developments planned for the future, such as an airport coming up, major malls being built, a new school, the extension of light rail, an increase in connectivity by adding more roads, or a large new company moving to the area, or development of a business hub or economic zone nearby can increase the appreciation prospects of a property. However, negative developments such as shops, gas stations, or offices closing down can lower the price and you may have to reconsider your decision.
Consult Your Real Estate Agent
Due to experience, your real estate agent will have a better idea of whether the property is appropriately priced and what a fair offering price should be, without even analyzing the data.
Decide for Yourself
Ultimately you are the best judge. If the property is after your heart or the kind you have been looking for, you will not mind paying a little more than the prevalent market price if need be. However, if it isn’t even a discounted price will not seem fair.
Test the Waters
To do so you may start by making an offer below the list price even in a seller’s market, to see how the seller reacts. To avoid negotiating, some sellers list properties at the lowest price acceptable to them. On the other hand, some list properties higher than the expected price expecting the buyer to bargain or they might offer a higher price. If such sellers accept your counteroffer, you have got yourself a fair deal. However, some sellers may also underprice their properties, to attract more buyers. However, ‘Lowballing’ or making an artificially low bid can increase your risk of being outbid by another buyer and even offend the seller.
Get an Appraisal and an Inspection
If you are taking a loan or are under contract, the lender would like an appraisal of the property so that in the event of non-payment of mortgage or foreclosure, they can get their money back. Hence, if the appraisal price is less than your offering price, you have not got a fair deal and your loan may not be approved. A property inspection post-contract will also help you gauge the offering price so that you may ask the seller to make the required repairs or lower the price so that you can make them yourself.
Property Selling Tips
Prepare Your Property
Before listing your property for sale, ensure that it is in an appropriate condition depending on your local market. In a seller’s market with low inventories, buyers may overlook certain fixes, but if inventory is higher, they have more choices and expect an upgraded property. Hence, get a pre-listing inspection done and focus on repairs, deep cleaning, easy upgrades, boosting curb appeal by exterior repair and repainting, power-washing, landscaping, and featuring or creating usable outer space.
Prepare for Marketing
Prepare your property for marketing by depersonalizing, staging, or virtual staging, and have professional listing photographs taken with the help of your agent.
Work with an Experienced Agent
A top well-experienced agent can help you through every stage of the selling process, from making upgrades and listing to showing the home and comparing offers. They know what works and what does not, in the challenging market conditions of today. Whether you wish to sell your property in a short time or get the best deal possible, an experienced agent has the resources and skills necessary to help you as they know what buyers are interested in and how to find those buyers. They also handle all of the marketing, showings, and open houses and once the offers start coming in, they help you analyze each one and decide which is the best offer for you. Though you may want to avoid paying the agent commission (5% to 6% of the sale price) and list the property yourself and go for FSBO you may still have to pay the buyer’s agent which is half the commission (2.5%). But top agents can certainly negate these supposed savings by getting you much better deals. According to the National Association of Realtors, FSBO homes sold for 16% less on average than agent-assisted sales.
Sell at the Right Time
When you decide to sell can make a big difference in getting a better deal, as you await a rise in real estate prices and better market conditions. However, if you are in a hurry for any reason, you may have to go with the prevailing market rates.
Pricing your home is a complicated but extremely important process. An experienced real estate agent knows how to price your property fairly by using a Comparative Market Analysis (CMA) in which they find and use the sale prices of properties similar to yours to determine the best sale price for yours.
In a sellers’ market, when inventory is low and buyers have fewer choices, you can price your property higher but in a buyer’s market, when inventory is high and buyers have more power, you will need to price your property more competitively. It is important to limit the number of days your property spends on the market and avoid turning off buyers. So, whether you are planning to buy or sell a property, in 2023, the tips and tricks above will definitely help you get a fair deal, we are sure.
By Guest Post
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