The Contingency Clock Keeps Ticking

As everyone knows the real estate market in Tucson and the rest of the nation has taken a turn in the last year. Luckily the Tucson housing market is still in better shape then a lot of other areas in the country, as homes are still selling and we're already seeing homes prices begin to inch their way up. But it's a tough market for those homeowners that are currently trying to sell their homes. Two years ago home sellers wouldn't take a contingency, they didn't need to. In Tucson homes were selling faster then we could list them. In today's market we are seeing contingencies more and more, and the contingency clock is ticking louder then ever.

So many home sellers are in the same predicament right now; can't buy unless they sell. A close friend of mine who is a REALTOR is planning to sell her home in Tucson and relocate to Phoenix. She did her homework and studied the comparables and found the price she felt would bring lots of buyers to her front door. She had a home inspection, she's offering a home warranty plan and money towards closing costs. The house is in a great NW neighborhood, is move in ready and is located on one of the largest lots in the development. This house is ready to sell! In the meantime she's traveled to Phoenix with her family and looked at new construction homes and found one she absolutely loves. The problem is, no one is looking at her own home in Tucson. On the market 30 days and two "looky loos". The home builder in Phoenix will take a contingency, but only for three months. And prices on those homes are already going up. She decided that this new house is too great to pass up so they put together a contract on their new home. And so the clock is ticking as she waits for an offer on her current home.

My friend recently asked me... "Should I drop the price now or wait to see if the market picks up?" It's hard to answer this question because you don't want to give anyone the wrong advice. And no real estate professional can honestly "predict the future" and tell you if prices will go up or down. To drop or not to drop the price; that is the question. It depends on each sellers situation at the time. My question for my friend was "How much do you want the house in Phoenix?" If she doesn't sell this home then she can't buy in Phoenix. Then it becomes about price. We all want a certain amount for our home. Even myself, a real estate agent, feels that my own home is worth more then I could probably sell it for. It's personal. But unfortunately the current real estate market dictates what a seller is going to get for their home right now. The price might not be as high as we'd like, but it's much more realistic then it was two years ago.

Tucson is beginning to see increased activity in the real estate market. More buyers are peeking out of the "mortgage meltdown" shadows and diving into the inventory of homes currently available. But there's still sense of caution, their steps from the shadows are on tip toes. The next few months will be telling...will the interest rate cut motivate the economy? I expect we'll need another cut to get the ball rolling, but time will tell. And the clock keeps on ticking.....