This gorgeous Cedar City property sold in October 2017 for $620,000. It's a stunning 7800 sqft, 7 bedroom, 6.5 baths, 4+ car garage mansion, loaded with every possible feature. It was listed a few months back @ $1.5M and recently expired.
Something to consider: How would such a fabulous dream home sell for so relatively little just five years ago? At that time there was low demand and high inventory. Fast forward to the summer of 2020 and we experienced completely opposite market conditions (low inventory and abnormally high demand) to the point that, by early this year, values had skyrocketed, on average, almost 40%!!! Annual appreciation is 3 to 6% in a normal/healthy market...
Why did I use that comparison? It's a reminder of what local buyers can afford when out-of-state buyers are absent. The correction we are experiencing will bring values back to what's more realistic for the market in which we live.
Since early 2022 we've witnessed a rapid change in market conditions and demand has started to slow down. The correction in property values has been almost as dramatic as it went up. The fear fueled covid-inspired migration from bigger cites and out-of-state buyers has subsided. In fact, nationally, sales spiked so much from mid-2020 to early 2022, it’s likely we will see a lag in the number of sales nationally over the course of the next 18 to 24 months.
Of course it is only natural that many current home owners have seen this exponential growth and want to take maximize the equity they pull from their investments. 2021 brought prices we've never seen before in this area and most likely will not see again for years to come. Unfortunately, as the market continues to slide, many of today's home owners are clinging to yesterday's prices and simply holding on to unrealistic expectations.
Locally, it will be interesting to see how the 30+ subdivisions currently turning dirt, finishing roads, and/or putting new inventory up for sale, will contribute to real estate values. With diminishing demand, more and more inventory sitting, developers will most likely start trimming prices.
So what can you do if you still want to cash out?
The market correction we are seeing is still transitioning and, at this point, nobody knows how far it will fall before it levels out. But the situation today is still better than it's going to get and there are no guarantees that we will see a recovery to pricing as we experienced the past couple of years. So, as values continue to drop... once the market levels out... how many years will it take to get back to TODAY'S VALUES?
Maximizing as much equity as possible on the sale of your home requires a willingness to price and market aggressively.
To achieve this goal, it will be essential to team up with the right agent. Did you know, for example, that 60% of today's agents nationwide haven't even sold a single home in 2022! Even during the boom time of last year, over 70% of agents sold less than three properties.
As should be clear from the rather frank presentation of this newsletter, we are being completely realistic about where the market is going and advising our clients accordingly. Our marketing strategy continues to produce excellent results for our sellers and we have been blessed to help many great clients throughout the year with their real estate goals.
If you’re interested in capitalizing on this market and maximizing the equity from your property, don’t hesitate to reach out. This can't be stressed enough, sooner is better. Feel free to call me on my personal cell at 435.327.2090.
Have a great day,
Jared
