Real estate was a flurry of activity from June 2020 to the spring of 2022. Bidding wars, waiving appraisals, offering the sellers our firstborn all to get an accepted offer. It has been absolute insanity for 2 years now.
SCREEEEECH!!! The record player just came to a halt and the New Orleans real estate market has changed quickly – like, in a matter of a few weeks. Many real estate agents haven’t even caught on that it’s very different yet either.
What does all of this mean for you as home buyers and home sellers?
Bidding wars are OVER. (ok, not all. But unless your house is a rare find, you should not expect 15 offers and 50k above list price any longer)
Does this mean your house won’t sell? No, not at all. We are still lacking in inventory and there are plenty of buyers out there. It does mean that buyers aren’t grabbing the first thing they come across though. They have put on their patience pants and will wait for the right house to come along.
Also, insurance rates have doubled in our area. This insurance change affects the buying power of many!
How to approach this new/changing market:
- Stop overpricing your home! You don’t need wiggle room to negotiate. We don’t know who ever told you that – but throw it out! Pricing your house properly can almost guarantee a full-price and fast offer.
- Staging. We keep preaching the values of staging and this is when it will really matter!
- Odds & ends: those details sellers have skipped the last two years will mean a lot moving forward. Paint your house. Get the new roof. Fix the leaking sink. Clean up the yard. Empty your closets. All of this will matter now.
- Are you motivated? Have your agent use the agent remarks (it’s a secret section of the MLS that only other agents can see) to voice what you are and aren’t willing to do!
- Hire an agent who is full-time. Now, more than ever, you want a seasoned agent who can really market your house! You need a floor plan, great photos, and a video tour to make your house shine. The last two years have allowed a lot of agents to be sloppy. Get one who has always presented their listings well.
- The details. Termite contract? Get one. Flood insurance? If you don’t have flood insurance for the buyer to assume 😬 then at least get them an elevation certificate to help with quotes. If the roof is 20 years old or has damage – CHANGE IT. We can recommend some amazing, affordable roofers.
- Lagniappe. Since interest rates and insurance are all high, offer to pay for a year of flood insurance.
It’s your time to shine, baby!! Well, sort of.
We know the last two years have been rough if you’ve been house hunting and we wish it was all sunshine and roses now – but, it’s not. Interest rates have changed your buying power. Insurance has changed your buying power.
What’s a buyer gotta do?
- Get a local lender! Y’all. We cannot stress this enough. With these insurance changes, you need a lender that is IN THE KNOW. Otherwise, your out-of-town lender will grossly underestimate the amount you’re going to spend yearly.
- Stay off the online calculators. Because your monthly payment will be impacted by all these other factors, online calculators will be WAY off. Ask your lender to work your house budget around the monthly payment you’re comfortable with.
- Wait it out. If you’re not loving what you’re seeing on the market (there is still a shortage in housing), then wait a little longer. The right fit will come along. However, we don’t know where interest rates will go.
- Don’t expect massive price drops. This isn’t a housing bubble. This is a softening of the market. Things are stabilizing and prices will not continue to soar. But if you expect an Uptown home to drop hundreds of thousands of dollars – you’re better off buying a lottery ticket.
The Main Takeaways
Our market is stabilizing and there is more leeway when making offers. If a house has been sitting on the market for a while, you can likely negotiate a lot more than you could just a few months back. However, the insurance rates are going to fill in the gaps for the drop in sales price.
Talk to your trusted real estate agent about what is the best move for you!
Ready to chat? Start by texting us!
Contact Team Be New Orleans