What We Can Learn From Black Friday

 

You most likely saw the thousands of shoppers lined up outside of stores to take advantage of advertised bargains on Black Friday.  Shoppers stormed the stores scooping up bargains and the frenzy generated excellent sales results (if we ignore the injuries that occurred again this year).
 
The consumers were so anxious to spend money on bargains, and the stores were so anxious for sales, Thanksgiving was transformed into Black Thursday for some retailers!
 
What does this have to do with real estate?  To me, it proves that consumers that have jobs and/or disposable income want to start buying again!  As one reporter said, “People have been shopping out of their closets for 3 years and they are not willing to keep to doing it.”
 
It use to be that supply and demand controlled our economy, and although they factors still control pricing, the stimulus to purchase has changed dramatically.  Consumers are fearful of spending and we don’t see buyers purchase until the consumer’s individual demand exceeds the fear of parting with their money.  That is what we saw on Black Friday and what we see in real estate.
 
The pent of demand for those advertised bargains was obviously huge, as is the pent up demand for homes.  We have never seen so many people that WANT to move.  You probably know someone that says they want to downsize, move closer to family, or move to a better home.  What is stopping them?  Not the real estate market, but their fear of parting with their cash or the fear of taking on debt.  However when we see aggressive pricing of homes for sale, the type of pricing that occurred on Black Friday in the retail industry, we see multiple offers with stiff competition among buyers looking to scoop up bargains.
 
Retailers can get people to buy by announcing that prices are only in effect for a particular length of time.  Home sellers don’t have the exact same luxury, but savvy home buyers are well aware that interest rates have ticked up and even the slightest movement means tens of thousands of dollars of interest.
 
Home sellers need to pay heed to the lessons of Black Friday and realize that there are a lot of buyers out there and the buyers really want to buy.  But they will only buy if they feel that see a tremendous value that will not last…in others words the house has to be priced to the point where the buyer feels that they must jump up and buy it now before someone else does.  If they think this is the typical “sale” price, they will not see an incentive to act now and will wait to see if something better comes along even it means they wind up shopping the sales after Christmas when there is less inventory.
 
What can buyers learn?  When you see what you want at a good price you better jump in and buy it.  The “sale” prices will not last forever, and if you lined up outside of Best Buy for the TV steal of the century and didn’t get it, you also missed getting the great sales at all of the other retail outlets and will wind up paying more or settling for fewer features.  Prices in Anacortes are not going to increase next year, but interest rates most likely will. 
 
If you are looking for the Black Friday of real estate, it is today.  Inventory is good, interest rates are low, and prices are incredible.  Sellers-price to stimulate action out of buyers.  Buyers-when you see at a great price you should buy it because you could pay more and if interest rates go up, you will pay dearly.
 
Real estate agents….we add the incredible power of advertising, especially the internet.  A great price and wonderful features of a home need to be communicated in the appropriate way through broad local, regional, national, and international advertising.
 
If you like to see a pricing model for your home for a sale in 60 days, 90 days, and 120 days, along with the most comprehensive marketing program in NW designed to reach home buyers, then please give me a call at 360-941-3734 or email Jean@ColdwellBanker.com