Spring Selling Season Starts

Now that 2025 has arrived, buyers and sellers are preparing for the upcoming spring real estate market. However, unlike previous years, with the stock market going up and down the first two months of the year, there is a sense of uncertainty and anxiety.

In 2023-24, many people reflected and adjusted to new realities. Mortgage interest rates at 7% felt considerably higher compared to the 3% rates just a few years ago. Prices declined and the market was at its slowest in at least 25 years. Both buyers and sellers were uncertain about current prices and future trends. Some are hopeful that with a Trump presidential victory, the financial markets and real estate will perform well like his last term. However, the threats of tariffs and inflation have put a damper on the public’s economic confidence.

Last year, many sellers withheld their properties from the market hoping for higher prices, while buyers waited on the sidelines for interest rates to drop. This is typical in a transitioning market.

However, life circumstances still require some property owners to sell, and some buyers are choosing to purchase despite higher interest rates, attracted by lower prices with the potential for future refinancing. Historically, a 6% to 7% interest rate is not exceptionally high, though recent 3% to 4% rates have set a different expectation unlikely to return soon.

The first two months of 2025 saw low inventory, leading to multiple offers and overbidding in some cases. The direction of the market remains uncertain, but there are signs of more properties being prepared for sale, suggesting a potentially active spring season. Single-family homes appear to be selling well. The condo and investment markets are still very sluggish.

In order to get the best results when putting a home on the market, many factors need to be considered. Pricing and emotional appeal play significant roles in achieving higher sale prices. Buying a home is often an emotional decision and can be stressful for purchasers committing to a significant financial investment.

Multiple offers can validate buyers’ decisions, showing that others share their interest in the property. To create appealing emotions as a seller, preparing the property for sale is crucial. Today, buyers are busy and often seek move-in ready homes.

There are cost-effective strategies that can yield significant returns. Decluttering the house can make it appear larger and well-maintained. Painting and refreshing the backyard are inexpensive ways to enhance the home’s appearance. Refinishing hardwood floors can also greatly improve presentation.

Professional staging can further boost a home’s appeal by showcasing it like a model home, adding value and differentiating it from other properties on the market. As home prices rise, staging costs become a smaller percentage of the selling price, making it a worthwhile investment.

Marketing has evolved, with online presence playing a critical role in attracting potential buyers. Quality photos, virtual tours and videos are essential for generating interest. Buyers today will look at a home on the internet before visiting. A good first impression needs to be made there.

Buying or selling a home is stressful enough, but especially more so during uncertain times. Transactions will continue; there will be people who need to buy or sell. And that’s when good advice is necessary from a professional in helping to make those buying and selling decisions as easy and painless as possible. We are looking forward to an active spring selling season!

John M. Lee is a broker with Compass specializing in the Richmond and Sunset districts. If you have any real estate questions, call him at 415-465-0505 or email johnlee@isellsf.com.