Knoxville Tennessee Real Estate Blog

The Knoxville area sales statistics are out now for the month of April. So what do the numbers look like compared to previous Aprils?

Traditionally in April the spring sales season is humming right along with the birds and bees. Unfortunately the past few Aprils have seen more of a nosedive than an increase in volume of sales. Here’s a comparison of April sales volume for the past 11 years.

Knoxville, Tennessee April sales figures

This chart displays over a 45% drop in sales volume in 2009 compared to April of 2005 and a 27% decline from April of 2008.

So what’s going on with prices? Are prices of Knoxville area homes taking a similar dip. Fortunately they are not. Even though the average sales price of a typical 3 bedroom Knoxville home is $151,300 compared to a peak of $168,300 in April of 2007 those numbers just mean we’re selling lower priced homes more than upper bracket sales.

3 bedroom home sales, Knoxville, Tennessee area for April.

In previous posts I’ve listed the reasons I believe sales of lower priced homes were higher than upper bracket ones and here they are again:

• Lowest interest rates in history. Renters can now usually buy a comparable sized home for less monthly payment than they’re currently paying in rent.
• An $8,000 federal tax credit for a huge majority of buyers today.
• A big selection of homes including short sales and foreclosures, with owners willing to help with buyer’s closing costs to encourage them to buy their properties.

It’s sort of a ‘perfect storm’ for homebuyers right now.

So if you need to sell a house or condo in the greater Knoxville area today what can you do? We’ve also discussed that in previous postings and here’s that list of tips again:

• Number one on my list would be a very aggressive list price. I’m seeing homes on the market now that are not selling for what the owners paid for them as long as 3 years ago. If you’re a seller you’re competing with both a lot of other houses and the continuing stream of bad economic news that your potential buyers are bombarded with day after day. “Layoffs, hundreds lost jobs, downturn, worst economy in (take you choice of numbers), recession, etc.” It’s no wonder buyers are scared to buy if they can’t have confidence they’re have a job next week or next month.
• I also believe it’s equally important that you do whatever it takes to put your house in showroom condition. You have probably seen what auto dealers do with late model trade in cars. If you haven’t, they shampoo or replace the carpets in the car including the trunk, wax and buff the exterior until it shines, steam clean the engine, shine up the tires, and generally make it as appealing as possible and as close to new looking as they can get it. You have to do the same with your house. Stop thinking about it as the place you’ve had Christmas with your family, watched your kids take their first steps, and other emotional ties and start thinking of it as a piece of merchandise you’re trying to sell.
• Offer some buyer incentives, especially important in the lower price ranges. With all the news about the mortgage market lenders are more strict than ever about buyer requirements. Whereas in the past they used to use a magnifying glass on buyers they’re now using microscopes and requiring more documentation. I recall a transaction I had that closed last week and I had to prove I was not the Jim Lee on the FHA mortgage fraud watch list and submit an affidavit that I had never lived in a certain city in Illinois. And I was not even a buyer or seller in this transaction; just the buyer’s agent.
• Be prepared to accept an offer from a qualified buyer that may be below your list price by a large discount if you want to sell. Buyers read the news too and realize they are in the driver’s seat. Having your house in showroom condition, aggressively priced, and perhaps offering to throw in 3-4% of the sales price to help a buyer get in very often makes the difference between a buyer and a ‘just looking’ prospect.
• Exposure to as many potential buyers as possible. Common sense says that the more people that are aware something is for sale and want that thing, the more it becomes worth to them. Right now over 80% of all buyers are looking on the Internet for houses for sale. If you’re house doesn’t have a good presence with lots of photos AND MOST IMPORTANT, isn’t easily findable by potential buyers, you’re not going to be able to create that demand that brings the best possible price no matter what the economic conditions and how much competition you may have.

As always, KnoxvilleHomeCenter.com is a good place for buyers to begin their search and sellers to find lots of specific tips and advice on what you can do to get your home sold.