Everyone wants to know how the market is doing and if it is turning around. Most would say “It’s A Buyer’s Market” and take that to mean that the list prices and subsequent appraisal values of homes to be continuing in the downward march from the recent high market bubble which burst in 2006-2007.
For many sellers that would like to make a move, the feeling that “It’s A Buyer’s Market” evokes visions of weeks and months of market time, and low ball offer after low ball offer; and that ever present feeling of dread that they have lost most of their equity in the recent market adjustments that have led to lower list prices for the same homes. But is that really the definition of a “Buyer’s Market”. Or are the scales just slightly tilted in favor of the Buyer?
Maybe to understand the market we need to take a closer look at some of the details from the time that the market was booming and everyone had the feeling that it was a “Seller’s Market”, a time when the scales were slightly tilted in the favor of the sellers. In 2003-2004 the market was going the way of the seller and the buyers were feeling the pressure. But even at the high mark of this bubble when everyone felt it was the seller’s market, the sellers were seeing higher and higher prices. So did that mean that a seller could just list their property for whatever price they wanted, and the buyers had the dread of losing offer after offer because the sellers did not need to negotiate, there would always be another buyer. Therefore, we would expect in a “Seller’s Market” there were never any listings that left the market without being SOLD?
Let’s take a look at some market history in Eagan homes for sale. According to my search of the MLS records, from Jan 2004 through Dec 2006 there were 2,616 SOLD properties in Eagan that included town homes, condos, single family homes. However, during that “Seller’s Market” there were also 838 CANCELED Listings, and 365 EXPIRED Listings. If you were a buyer during that period of time in Eagan, MN and surrounding areas, you would find it hard to believe that there were that many properties that went off the market and were NOT SOLD. And of course, the sellers would consult with their REALTORS and relist the property at a new adjusted price, or the sellers would hire a new and improved BROKER to handle their property. So many of those canceled or expired listings were eventually SOLD at a lower price. The fact still remains that even in the “Seller’s Market” the sellers could not, and did not, just continue asking and selling for higher and higher prices.
The buyer still needed a workable knowledge about the market values, hopefully with the guidance and advice from an experienced buyer’s agent. What really put pressure on buyers to make a decision and made it a “Seller’s Market” was that the buyer had the pressure of knowing if they were not quick enough to recognize the value, then there were other buyers in the market that would and the first buyer’s opportunity would be gone. So the pressure was on the buyer to be knowledgeable about the market and ready willing and able to buy without taking too much time. But did that mean that the sellers were able to sell their property ABOVE market value? The answer is NO, all the transactions were at or very near market value but the scales were tilted slightly in favor of the seller, i.e. less market time at the market price. But if a property was overpriced, it still went UNSOLD until the sellers adjusted the list price to a market value.
So let’s take a look at the “Buyer’s Market” in Eagan at this time. From Jan 2007 through Dec 2009 there were 2,217 SOLD properties in Eagan that included town homes, condos, and single family homes. Only slightly fewer SOLDS than during a peak period. The average home value in Eagan in 2005 was $263,458 in comparison to the average I found in 2009 of $247,516. However, during that same “Buyer’s Market” there were also 1137 CANCELED Listings and 1251 EXPIRED Listings. As a percent of the market there are even more properties that are on the market and eventually not SOLD by the end of their listing agreement, or they had to adjust their prices to attract that offer. The average market prices in Eagan have adjusted by 6.05% on the average. Not as much market adjustment as other areas of the Twin Cities area. Eagan real estate is still high on the list of many buyers.
The sellers continue to price above market value and many of them are UNSOLD after those listings have run a normal market time. They need to make a price adjustment to find those buyers who find value and their needs and desires. Even in this “Buyer’s Market” buyers need to have the knowledge of market values. If a property is over priced it will continue on the market and be UNSOLD at the end of the listing contract. However, the pressure is still on the buyer when they do find a home that is at market value, and has the magical combination of value and meeting the buyer’s needs and desires. The buyer always has the pressure of making a decision to submit an offer to purchase a property that is at market value. If the buyer waits too long, other buyers will recognize the value of that property and submit their offers, and thus the first buyer may lose their opportunity to purchase the property that fits them and their needs.
The buyers in both markets are the decision makers in submitting an offer. There are only three answers to any offer that come from the seller(s) and that is YES, NO or a COUNTEROFFER. So buyers are always welcome to make an offer, they just need to be prepared to hear the NO answer. That typically means that in the opinion of the seller that the offer is too far for the seller to start a meaningful negotiation. We do hear that answer from sellers even in this “Buyer’s Market”. But the good news is that the buyers have many more options to consider and time would be slightly in favor of the buyer. If that home is above market value there will not be another buyer to make an offer, and the buyer may return to that property at a later time. However, in the “Buyer’s Market” the buyers do usually find another option and seldom return to that first offer.
The buyer is always the one that needs the knowledge and the desire to make a reasonable offer for a property. How does a buyer gain that knowledge? Finding an experienced REALTOR as a buyer’s representative will aid that learning process. I provide all my buyers with up to date information concerning the area market data on other properties that have recently SOLD. I have been living and working in the Eagan helping buyers with this process for the past 7 years. Just pick up the phone and give me a call, I do enjoy helping people find the home that meets their needs and desires.
It is a “Buyer’s Market” in Eagan and the surrounding area. Property values are very good, the Eagan area location is desirable and is likely to stay very high in the future. And let’s not forget the interest rates on mortgages are still very low along with the fact that First Time Home Buyers may qualify for that $8,000 Tax Credit. The scales are tilted in the buyers direction. So have an experienced buyer’s agent help you when purchasing your new home in the Eagan area. I have a good working knowledge of most areas in Dakota County as well, so even if we cannot find a home right in Eagan, we are sure to find one in the immediate area.
If you are a seller, then contact me concerning a free Comparable Market Analysis – CMA. Let us help you market your property and set a market price that will attract the buyers that are in this market. Real estate is selling in the Eagan area and I work hard with my sellers to get that property sold for a market value, and as quickly as possible.
Tags: buyer's market, Eagan Homes for sale, Eagan Minnesota, Eagan Real Estate, seller's market
