Like most people, I welcome this new year with a sense of optimism and enthusiasm, and our local real estate market gives me much reason for this sunny outlook.
While many industries continue to endure or recover from the pandemic, real estate is holding strong, even more so here on Aquidneck Island. Our City by the Sea and surrounding coastal communities have long been a destination people want to call home, and as nearby cities like Boston and New York continue to experience urban flight, our idyllic island community is in demand. Other factors, like the
increased ability to work from home and mortgage rates near all-time lows, have contributed to what I would describe as one of the busiest years in local real estate I’ve witnessed (and I’ve been in the biz for 18 years)!
This trend parallels what’s been reported nationwide. According to the National Association of Realtors, existing home sales hit a 14-year high this past August and we’re on track to experience the ninth straight year of increasing home values since 2010. Looking ahead locally, I suspect that we’ll see this boon continue for the foreseeable future.
Though a robust real estate market is a positive indicator of community ripe with consumer confidence – an enviable spot to be in – we are presented with a significant, reoccurring challenge here in Newport County: inventory. Generally speaking, homes and condominiums new to market garner offers right away. For buyers, this means a few things. First, you need to act swiftly. There are countless reasons to work with a realtor but this is one that rises to the top. With access to the MLS, a proven marketing strategy that creates demand and longstanding relationships with industry colleagues, a realtor can schedule a showing exponentially quicker than a cold call from an unrepresented buyer (and oftentimes before a property is listed).
While trying to do-it-yourself might seem easy enough, there are multiple disadvantages to navigating the real estate market without an agent, especially in a hot market. Making an offer without an agent is risky – if you haven’t covered all your bases, you make a mistake or you leave something out. If the seller accepts and signs your contract, you’re legally bound to that contract. So, making an offer isn’t something you’ll want to do without the guidance of a professional.
Another common issue for buyers in a low inventory market, and equally recurrent on Aquidneck Island right now, is bidding wars. When multiple buyers are competing for the same property, typically driving up the price of the property, an experienced real estate agent is imperative to lead delicate negotiations on your behalf. Market knowledge and industry relationships are invaluable in these situations.
A real estate agent is equally critical from a seller’s vantage point as well and can tee up your listing to garner multiple offers so that the ball is in your court. Typically, after running a comparative market analysis, your agent can determine a fair market value of your property to attract buyers quickly and motivate them to submit a smart offer. The benefit of working with buyers represented by agents means they’ve been vetted and are qualified, serious and eager to move forward as opposed to real estate rubberneckers.
Though a bidding war is desirable, each offer comes with its own set of terms, so the best offer isn’t necessarily the offer for the most money. Caveats like an escalation clause – when an offer comes with instructions to automatically increase by a predetermined amount each time another party makes a higher offer in order to outbid the top offer – need to be considered to get a comprehensive evaluation
of every offer on the table. In addition to legal guidance, logistical assistance and regulatory requirements, bottom line, real estate agents statistically garner substantially higher offers. If you’ve been considering selling, I can help you navigate this frenzied market.
Our philosophy at Teri Degnan Real Estate & Consulting, LTD has long been to work alongside our clients by making fact-based, well researched decisions that make your buying, selling or renting experience one you can feel confident about. We look forward to working for you.