You’ve probably heard a lot about the state of the housing market since the global financial downturn in 2008. The crisis affected many aspects of financial life, but the housing market has been hit particularly hard, and is still struggling to improve to a situation that suits both buyers and sellers. The question is, what exactly is going wrong, and why isn’t your house selling?
The Sub-Prime Market
One of the major catalysts of the downturn was an excess of what are known as sub-prime mortgages in the United States. These were mortgages given to people with less than ideal credit ratings. Unfortunately, much of the debt became bad – meaning it wasn’t paid back. This caused serious negative implications for the lenders, some of which collapsed in numerous high-profile cases.
This situation caused banks all around the world to make their lending criteria much, much stricter to avoid the same thing happening again. Where once it was relatively simple to get a mortgage with a reasonable credit rating and income, it is now very difficult in many places around the world.
With lending a lot less common, it has become quite difficult for people, first time buyers in particular, to be able to actually afford a house to live in. Where once there had been many buyers, there are now far fewer around which has obvious implications when you’re trying to sell.
Not only are there fewer buyers, but the buyers that are around can afford less, and are only willing to pay smaller amounts. This has meant that a lot of people who bought houses in the last decade are not too keen on selling in this market.
Marketing, Marketing, Marketing
The upshot of all this is that it takes a lot of effort to sell a house these days, which means choosing the right marketing strategy is essential. Estate agents rely on custom packages rather than a one-size-fits all method. You need to tailor things to the buyers in your area and be prepared to change tack if necessary.
The market certainly isn’t impossible to operate in, but if you understand the reasons for a more difficult selling environment, you’ll be better placed to combat it, and ultimately sell your house for the price you want, and not have to wait an age for it to happen.