Market Update

    I’ve been talking with several people in the West Michigan area who have asked me “What’s the market like? Is it as bad as the papers say?”

    The good news is we, in West Michigan, are sitting better than much of the state and have seen a strengthening of the selling market as of late. We’re not as robust of a market as in 2004 – but that’s to be expected. You can not sustain record sales growth. The West Michigan market has continued to strengthen from what appears to have been the worst slump back in summer/early fall of ’05. We’re now in a stage of flushing out the market as we move into peak buying season. While the majority of the Grand Rapids and surrounding areas are still considered a “buyers’ market” (a list to sales derived ratio) we continue to see an increase in “neutral market” (neither buyer or seller are favored) and even some “sellers’ markets” are forming. This is a positive sign and one that should continue to assist in evening out the market.

    An important consideration to remember during “buyers’ market” times is that it’s a sliding scale. The majority of sellers soon become buyers and naturally buy a home that costs more. While you may take a 5% hit on the house you’re selling there is also a high likely hood of obtaining a 5% or more decrease on the one your are buying. For example if you list your home for $185,000 and you take a 5% hit to sell it you’re taking a $9,250 loss. HOWEVER when you go to purchase you’re new home for $$275,000 a 5% reduction here is $13750. You just kept an extra $4500 in your pocket!

    To determine if you’re in a sellers market or ways to potentially retain higher than 5% off your sale price please feel free to contact us for an individual analysis.

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