As we close out the first half of 2021, we aren’t seeing any slowing down in the Middle Tennessee real estate market. The absolute insanity continues. In my 23 years of selling residential real estate, I have never seen anything like this market. I could tell stories all day long and start again the next day.
No one knows how long this frenzy will last. People can predict, but nobody truly has a clue. My personal belief is that we will not see any type of slow down until the mass exodus of people from certain states to Tennessee begins to lessen.
While the market is on fire and red hot, it is still extremely important to properly price your home for sale. It is very easy to fall into the overpricing trap. I strongly recommend listing prices to be at the best comparable sales over the last 90 days. If there have been a lot of very recent sales in a particular area, I may only look at the past 30 or 60 days. This gives the most accurate snapshot of what is happening in the market in a particular area.
People will argue that if there ever was a time to throw a super high listing price out there, it is now. I completely disagree! Let me explain.
There are buyers in literally every price point in Middle Tennessee right now... and lots of them. It’s weird to say, but a high percentage of listings are quite similar to a slower paced auction. The large amounts of showings and multiple offers over one or several days are major driving forces in sales over list price. My point is that the market is there. If your home is priced right, but theoretically could sell for more money, it will in this market. I promise that. You do not want your inflated list price to initially slow your traffic. Allow the frenzy of showings and multiple offers to drive the price up. If your price does not get driven up, you are almost assuredly selling at the price the market is saying the property is worth today.
Here is another reason to price properly: In today’s climate, sellers that do not contract on their home in just a few days on the market are dropping their prices quickly in many instances. These price drops are not like the price reductions in the past. These are much higher price reductions. I regularly see $50,000 to over $100,000 price reductions. This makes real estate agents and buyers wonder “what’s wrong with that property that it did not sell immediately and has already been reduced in price?” That is NOT the stigma a seller wants. It will likely slow the sales cycle and can be very deflating to all parties involved. This market does not view price reductions the same as markets in the past.
Lastly, any agent doing any level of sales right now will tell you that removing as many contingencies as possible is extremely important. The transactions with the least amount of contingencies are usually the ones that are contracting in the first few days where multiple offers were received. If your listing has been on the market longer than expected in today’s market climate and you do not receive competing multiple offers, you are likely going to eventually get an offer with more contingencies than a properly priced listing that contracts in just a few days or less. Many times, lack of contingencies is just as important as price.
In conclusion, a proper list price, that is not optimistically inflated, will give a seller the best opportunity for a large amount of showings and multiple offers. High activity and competition are producing the highest priced contracts with the least amount of contingencies.
Chip Kerr is the founder and manager of Kerr & Co. Realty in Franklin, Tennessee. He is a Williamson County native and has been a licensed agent for over 22 years.