Back in June of this year, I wrote an article about the market shifting. Some people didn't agree, some people didn't like it but none-the-less it had begun. We are now in October and the market from Beverly Hills to the beaches to the Valley have all experienced this shift. And what exactly is the shift, you may be wondering? We have pretty much been in a seller's market from about 2012 till just recently. This means there were more buyers looking to buy than houses that were available. This creates a market where the seller typically has more say-so in a transaction because it was harder for buyers to get an accepted offer and then once they did, the buyer had very little leverage in negotiations during the transaction. The seller's market is no longer here, and while some houses may be still selling quickly and maybe even some selling with multiple offers, it is more common to see houses sit on the market for a bit and possibly even drop their price. With this happening, it also leaves the buyers in more control during the transaction. And what does that mean, you ask? For starters, the purchase contract is written such that the buyer has more abilities and options to cancel than the seller, up to a certain point. Also, the buyers have more abilities these days to negotiate during the transaction because if buyers and sellers don't agree on repairs or credits during the transaction, the buyer can walk away leaving the seller to put the home back on the market and look for a new buyer which some sellers don't want to go through again.
What does this mean for the near future? I believe we will continue to see homes sitting a little longer on the market than before. This means we have to set up buyer's expectations that just because a home may be sitting, doesn't mean anything is wrong with it. It's just going to start becoming the norm. Also, homes will be off and back on the market more while we are in this transition since buyer and sellers may be trying to hold their grounds stronger during negotiations. And again, this won't mean something is wrong with the house. We may also have sellers experiencing wavering of decisiveness from the buyer throughout the transaction. When a seller wants to sell, they are typically set on their plan to sell and move. But that's not the same as a buyer. Buyers can say they want to buy one day, then change their minds the next. They may have an idea of where they want to buy and what the home needs to have but then go in the opposite direction when they actually buy. It's just the nature of buying a home. And when buyers aren't under any pressure to buy, the way they were in the seller's market, then things can feel a little rollercoaster-like during the transaction as the buyer may not be set on their decision. I hope this gives perspective buyer and sellers some insight into what to expect in the near future for our Los Angeles Real Estate Market. And when you start to think about moving, give me a call. I'm always here to help.
