Jan 24, 2024
In 2023, many homeowners who hoped to sell decided to hit pause on those plans. And for good reason: High interest rates had pushed many buyers to the sidelines—and created a “lock-in” effect dissuading would-be sellers from giving up their current low-interest home loans.
With both buyers and sellers feeling stuck, many of America’s real estate markets slowed to a near standstill.
But now, mortgage rates are finally subsiding a bit and house hunters are slowly returning—some with a vengeance. And with this pent-up demand finally coming down the pike, this year might be the perfect time to sell your house.
But a lot has changed since last year, so if you’re hoping to sell your house soon, you’ve got to educate yourself on the most recent market trends. Read on to learn about a few old, outdated home-selling rules that no longer apply in today’s real estate market—plus some new, improved guidance that will help you make the most of what is shaping up to be a busy year in real estate.
Old rule: Sellers will be lucky to find any buyer
New rule: Buyers are back—and so are bidding wars
In 2023, many buyers couldn’t afford both high mortgage rates and high home prices. As a result, many buyers gave up—and the few buyers who were out there prioritized affordability with an eye toward discounts. And with such little demand, many sellers were forced to oblige.
But with mortgage rates heading south, more buyers are coming out of the woodwork, and many might not be so strict with their budget. In fact, experts are already seeing sellers getting more competitive bids.
Max Carr, a real estate agent in California’s Orange County, says sellers are already attracting multiple offers and bidding wars in his market.
“In the last week alone, we’ve seen bidding wars on three different homes in our local neighborhood. Each time, the home was bid up $50,000 to $100,000 over the asking price,” Carr says. “Of course, these stories are relative, given pricing in Orange County, but it all points to the same thing: As rates come down, things appear to be heating up in the market.”
Old rule: Your home doesn’t have to be perfect
New rule: Sellers have to work hard to make their house stand out
In 2023, with so few homes for sale, buyers couldn’t be picky about a dated kitchen or an unfinished basement. Even the ugly ducklings and fixer-uppers drew plenty of interest, so some sellers let their prep work slide when listing their properties.
But lower rates mean more buyers are entering the market—and more sellers are willing to give up their current mortgage terms and make a move. With more houses for sale comes less leverage for sellers, so they might need to invest in renovations before listing.
“Sellers need to make sure that they are putting their best foot forward with the home,” says Cedric Stewart at Entourage RG of Keller Williams in the Washington, DC, area. “You want your house to be the absolute best version that you can make it and focus on the things that matter the most.”
Some updates that deliver the most bang for your buck include refreshing the landscaping, switching out flooring, and replacing light fixtures.
Carr agrees, saying that he’s already seeing buyers get pickier.
“This year, a home needs to be attractive and competitively upgraded to beat out the competition,” he says.
Old rule: Sellers may have to slash their price
New rule: Patience may be key to getting a high offer
Last year, home sellers’ lofty expectations often took a haircut as their homes lingered on the market. Many were forced to reduce their price.
This year, however, sellers might not need to lower their expectations as quickly as they did in the past.
Cindy Allen, a real estate agent in Dallas and Fort Worth, TX, says she recently saw a situation where sellers lost out because they weren’t patient. She was working with a couple who decided to make an offer on a property. While they were working out the details of the offer, the sellers reduced their price.
“Their new listing price was lower than what we had planned to offer,” Allen recounts. “I followed up with the listing agent and was told the sellers were becoming impatient after 40 days on the market.”
Old rule: Sellers couldn’t negotiate much
New rule: There’s more room for haggling
Sellers didn’t have much wiggle room with cash-strapped buyers last year, notes Jonathan Spears, a real estate agent based in Florida and the founder of Spears Group. But things are set to change in 2024: More buyers in the market means sellers have some room to negotiate.
So if an offer rolls in that isn’t as high as you’d hoped or lacks some elements that are important to you (like a long closing date), don’t hesitate to counteroffer rather than simply accept what you get.
Old rule: Don’t sell now because you’ll have a hard time buying your next home
New rule: Now is as good a time as ever to sell your home
With rates high, many sellers have been hesitant to move. Why sell their home and lose their (likely) low rate in exchange for a new house for a sky-high rate?
If this is you, experts say that right now is a good time to sell: We’re in a sweet spot where rates aren’t so high, but the market hasn’t quite picked up speed yet.
“We’re coming back to a market where you can still sell at a really reasonable price. And then if you turn around and buy again, you have more options and more negotiating power than you’ve ever had,” Spears says. “And so you get this opportunity, it’s a rare opportunity, where you can still potentially sell high and you could buy low and that’s because of quality and it’s because of supply.”
But it won’t last long: If today’s sellers wait to list and become buyers in the spring, they might be stuck searching for a home in a crowded market.
“If the rates continue to drop, as is anticipated, that competition may get fiercer,” Carr says. “Quickly.”
