Home Sellers: STAY OR GO!

Posted by Joe Manausa on Wednesday, July 21st, 2010 at 12:35pm.

Stay Or Go In Real EstateHome Sellers must decide to stay or go. It is as simple (though very painful) as that. This has been a recurring theme in real estate conversations that many of my troubled customers and I have discussed on a regular basis for more than two years. There are enough buyers in the market that we can sell just about any home, so ultimately the ability of each and every homeowner to sell their house is in their own hands.

Home Sellers: STAY OR GO!

If you go back to articles that I was writing in 2008, I urged homeowners to make the "Stay or Go" decision in order to save money. If a home sale was ultimately going to happen, I advised selling fast as prices were dropping thus a seller would get more early than they would at a later date.

Stay-Or-Go-In-Real-EstateThis turned out to be very accurate, as some sellers from that time have called and thanked me for pushing them to make the decision. Sadly though, you can find many Tallahassee homes for sale that were on the market back in 2008 and are currently listed today at lower prices ... but at prices that would have sold two years ago.

These homeowners just don't get the fact that they are chasing the market and need to quit a failing strategy. A look at the current trend of failures (homes that failed to sell) in the Tallahassee MLS tells us that even with the stimulus from the Federal Government strongly assisting the market, 6 out of 10 home sellers failed to sell their home over the past year!

Home Sales Success Versus Failures

Home Sellers, the choice is up to you. If you are holding out for an amount that the market is not going to bear right now, you need to know that values will recover, but most likely in the next 7 to 10 years. One day, every home in Tallahassee will be worth a lot more, but that day is not going to be in the next 3 to 5 years!

Our inventory of homes for sale in Tallahassee is too high and demand is far too low, and the newly revised banking system has no money for marginal buyers. When you add all of this together, it strongly suggests a long-term recovery.

So Sellers, if you are going to sell your home, the best value that you are likely to receive for quite some time is right now. Sell! If you don't have to sell, then Stay! But you really need to make the choice today.

You Need To Understand Your Home's Value Range

Do you really know what your home will bring in today's market? You need to have a real discussion of market valuations with a real estate professional that you trust. Find out what your home is worth so that you can decide whether to stay or go!

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Joe Manausa, MBA is a 26 year veteran of real estate brokerage in Tallahassee, Florida and has owned and managed his own company since 1992. He is a daily blogger with content that focuses on real estate analytics and providing his clients with a tactical advantage in today's challenging market.

3 Responses to "Home Sellers: STAY OR GO!"

Joe Manausa, MBA wrote: Thanks Jeremiah and yes, that is the sad truth. Many homeowners are just chasing a market they do not want to catch.

Posted on Wednesday, July 21st, 2010 at 9:41pm.

Sarah wrote: Great post! One question for you:

What of home owners who *most likely* will want to sell in the next 3-5 years? That's our situation as we are looking at finishing grad school in a year or two. Our options are always stay here, rent it out, or sell. But it is not so simple, is it?

To sell means taking a loss. To take a loss means (1) the bank accepting a short sale, or (2) us financing the loss. How the heck do we do that? Is it even possible in the state of FL to convince the banks to truly forgive the difference in case of a short sale? Will banks even agree to a short sale without proving serious distress (like losing a job?).

With regards to renting out the home, how hard is it to refinance a mortgage when the owner is underwater (because of falling real estate prices)? Our mortgage is hinged on this being our primary residence (it's a loan for first-time home buyers) so in order to rent it out we would be required to refinance.

And so our confusion grows. Since we currently are not going anywhere our thoughts are just to sit tight and enjoy our affordable mortgage and not worry too much. One side of me thinks about taking out subsidized student loans to pay down the mortgage so we will have the freedom to sell at a lower price or refi in the future. Of course that's taking care of debt with more debt, but at least we would have freedom of mobility. Am I crazy to think this way?

Any thoughts?

Posted on Thursday, July 22nd, 2010 at 2:44pm.

Joe Manausa, MBA wrote: Wow Sarah, great feedback and questions. Rather than answer here, I have written your answer as a blog post at <a href="http://www.manausa.com/how-to-handle-a-short-sale/" rel="nofollow">http://www.manausa.com/how-to-handle-a-short-sale/</a>.

Posted on Friday, July 23rd, 2010 at 11:36am.

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