The Biggest Mistakes Sellers Are Making Right Now

The housing market is going through a transition. Higher mortgage rates are causing more moderate buyer activity at the same time the supply of homes for sale is growing.And if you aren’t working with an agent, you may not realize that. Here’s the downside. If you’re not informed, you can’t adjust your strategy or expectations to today’s market. And that can lead to a number of costly mistakes.Here’s a look at some of the most common ones – and how an agent will help you avoid them when you sell. 1. Overpricing Your HouseMany sellers set their asking price too high and that’s why there’s an uptick in homes with price reductions today. An unrealistic price will deter potential buyers, cause an appraisal issue, or lead to your house sitting on the market longer. An article from the National Association of Realtors (NAR) explains:“Some sellers are pricing their homes higher than ever just because they can, but this may drive away serious buyers and result in unapproved appraisals . . .”To avoid falling into this trap, partner with a pro. An agent uses recent sales of similar homes, the condition of your house, local market trends, and so much more to find the price that’ll attract more buyers and open the door for multiple offers and a faster sale.2. Skipping the Small StuffYou may try to skip important repairs, thinking you can pass the task on to your buyer. But visible issues (even if they’re small) can turn off potential buyers and result in lower offers or demands for concessions. As Money Talks News says:“Home shoppers like to turn on lights, flush toilets and run the water. If these basic things don’t work, they may assume you’ve skipped other maintenance. Homes that appear neglected aren’t likely to fetch top price.”If you want to get your house ready to sell, the best place to turn to for advice is your agent. They’ll be able to do a walk-through with you and point out anything you’ll need to tackle before the photographer comes in.3. Not Looking at Things ObjectivelyBuyers today are feeling the pinch of high home prices and mortgage rates. With affordability that tight, they may come in with an offer that’s lower than you’d want to see – especially if you didn’t stage, price, or market the house well.It’s important you don’t take this personally. Getting overly emotional can put the sale at risk. As an article from Ramsey Solutions says:“Remember, a buyer’s offer is not a reflection of their opinion of your home or your housekeeping abilities. . . The sale of your home is strictly a business transaction. If they start out with a low offer, don’t take it personally and get emotional. Instead, channel that energy toward negotiating. Work with your agent and make a counteroffer.”4. Being Unwilling To NegotiateThe supply of homes for sale has grown. That means buyers have more options, and with that comes more negotiation power. As a seller, you may see more buyers getting an inspection, requesting repairs, or asking for help with closing costs today. You need to be prepared to have those conversations. As U.S. News Real Estate explains:“If you've received an offer for your house that isn't quite what you'd hoped it would be, expect to negotiate . . . the only way to come to a successful deal is to make sure the buyer also feels like he or she benefits . . . consider offering to cover some of the buyer's closing costs or agree to a credit for a minor repair the inspector found.”An agent will walk you through what levers you may want to pull based on your own goals, budget, and timeframe.5. Not Using a Real Estate AgentNotice anything? For each of these mistakes, partnering with an agent helps prevent them from happening in the first place. That makes trying to sell your house without an agent’s help the biggest mistake of all.Real estate agents have experience and expertise in pricing, marketing, negotiating, and more. That knowledge streamlines the selling process and usually results in drumming up more interest and ultimately can get you a higher final price.Bottom LineIf you want to avoid making mistakes like these, you need to work with a real estate agent.

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Powell signals September rate cut: ‘The time has come for policy to adjust’

Federal Reserve Chair Jerome Powell said on Friday that “the time has come for policy to adjust,” signaling a cut in the federal funds rate at the September meeting of the Federal Open Market Committee (FOMC) as expected by monetary policy watchers. “The direction of travel is clear, and the timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks,” Powell said during a speech at the Kansas City Fed’s annual conference in Jackson Hole, Wyoming. That’s good news for the mortgage and real estate industries, which have been challenged for some time by higher rates. Following Powell’s speech, the 10-year U.S. Treasury yield declined, and the expectation is that this will also be reflected in the historically correlated 30-year fixed mortgage rate, which currently stands at 6.67% for conforming loans and 6.73% for jumbo loans, according to HousingWire‘s Mortgage Rates Center.“The immediate reaction to the speech resulted in some reductions in longer-term Treasuries and secondary mortgage market yields, so mortgage rates may be somewhat lower in the near term. Our forecast continues to look for mortgage rates to drift down closer to 6% over the next 12 months or so,” Mike Fratantoni, senior vice president and chief economist for the Mortgage Bankers Association (MBA), said in a statement.Powell said in his speech that his “confidence has grown that inflation is on a sustainable path back” to the Fed’s 2% target. He added that after a pause earlier this year, consumer prices have risen 2.5% over the past 12 months. Regarding the labor market, Powell said it “has cooled considerably from its formerly overheated state,” with the unemployment rate rising over the past year to its current level of 4.3%.According to Powell, rising unemployment has not resulted from a greater number of layoffs but from a substantial increase in the supply of workers and a slowdown from the previously frantic pace of hiring. “Even so, the cooling in labor market conditions is unmistakable,” he said.  After inflation peaked in the summer of 2022, it came down due to the reversal of pandemic-related distortions to supply and demand, which “took much longer than expected,” according to Powell.Prices also came down due to a restrictive monetary policy. The FOMC raised its policy rate by 425 basis points in 2022 and by 100 basis points in 2023, holding rates at their current range of 5.25% to 5.5% since July 2023.As of Friday, monetary policy watchers believe there is a 100% chance of a rate cut in September. Most of them — 65.5% precisely — are betting on a 25-basis-point cut, according to the CME Group‘s FedWatch Tool, which measures the likelihood of changes to rates at upcoming meetings. “Chair Powell just rang the bell to start rate cuts,” Fratantoni said. “The softening of the job market has given the Fed the confidence that inflation will not re-accelerate. There is certainly a risk that the unemployment rate could rise faster and further than the Fed would like, but Chair Powell indicated that they are watching and would react to such a further softening in the job market.”

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Lofty CTO Henry Li on understanding the boundaries of AI

Editor in Chief Sarah Wheeler sat down with Lofty CTO Henry Li [this website SDHomeAndCondoSearch is run on the Lofty platform] to talk about the boundaries of artificial intelligence and how it’s reshaping his company’s roadmap. Sarah Wheeler: What differentiates Lofty’s technology? Henry Li: Lofty is a platform product — that’s been our vision from day one. We want to be the operating system for our users and their essential operating staff — for agents, Realtors, and brokers, no matter how big they are. Platform can mean a lot of different things. At Lofty, it’s an end-to-end experience — from consumer search on the IDX portal all the way to nurturing the client relationship in a CRM and converting that relationship into a real transaction. Completing that transaction generates all kinds of operating insight into in the system to drive smart business decisions. Platform also means we are not just by ourselves. We have a pretty powerful marketplace bundle with our product which comes with two parts. One is, obviously, we have an open API system, so we allow our partners to build their own apps on top of the system. We also allow them to use other partner services through our open API system and our marketplace offers a lot of different value-added services. One thing where we are a little bit different is we have pretty tight control on user experience. So for the important value-added services — marketing automation services, automated campaign lead generation service — those services are essentially created by us, but also we have a pretty open system We are working with select partners to distribute their service through a native experience on top of our marketplace. The other thing about being a platform is that when we design the product, we think the product should be generic — we’re not just building a product for the real estate industry. We’re a proptech company, so it’s not only Realtors who are able to use the platform, it’s adjacent businesses like mortgage brokers and property management companies. We’re not trying to build something like Salesforce, where you have to hire two Salesforce engineers to implement the whole system. We would require very minimum set up to in order to run the business on top of the platform. So the last thing is we are a scalable platform, meaning we are able to offer an experience from a single user all the way to a corporate user that has 10,000 users under that account. SW: At our recent AI Summit we categorized AI into three levels: automation, traditional AI and gen AI. How are you leveraging AI in the context of those three levels? HL: Automation, of course, is one of our selling points from day one. And if you think about the traditional definition of AI, we certainly have quite a bit of that, like predictive analysis. We score lead insights to help customer to understand the quality of the score and we have integration with third parties on data enrichment services. There are also a lot of recommendation systems embedded in our system, for example, the listing alert. The last part is gen AI: specifically, we’re talking about large language models (LLM). I think the most important thing is to really to understand the boundary of the technology. We were one of the first vendors roll out AI generated content (AIGC) features to help our customers generate listing descriptions, advertisements, blogs, text messages, emails, you name it. I think AI is very exciting because we’ve had to completely tear down our roadmap I think three times at this point, because the technology and the technology service providers are making tremendous progress. Because technology is evolving so fast, we have to evolve with the technology. And when you’re talking about AI features, it’s never a complete feature. Building AI features is different than the old concept of building software features because it’s not necessarily that you’re writing the code. You are tuning the AI to give the AI more capabilities. So it’s ever evolving. We start by looking at what type of work our users hire out. They often hire an ISA company [Inside Sales Agent] or a remote virtual assistant. So the main thing we’re focusing on is the AI assistant. Also, we have a pretty sizable call center that serves as tier one support for customers and one of our AI-enabled features is a service bot that helps with any product-related questions. We have a lot of of conversations with users on how to diagnose a particular problem so we’re using those documents to train an AI assistant. But this is really just the beginning. What’s exciting is we are gradually able to replace some of the tasks that they have passed to our call centers. It’s not going to happen 100% but with this type of infrastructure, we’re able to replace and enable that AI system piece by piece, and gradually provide a real, human-like service to our users. This is really what we consider stage two. The challenge for us, and the interesting problem for us to solve, is we think software is a perfect work bench for agents to have their data and we want to provide all kinds of tools to help them to complete certain tasks. So what we need is a scalable approach to deploy new capabilities for AI agents and deploy them to our product. We’re not talking about two AI assistants — what if it is 100, 200 or 300 different types of AI assistants that help our user handle different type of tasks? I think, the biggest challenge for us in the future is that we’ll need to redesign our software to make those capabilities accessible to our users in a very intuitive way. So we talk about some of the features that we have already released, but compared to what we’re going to release, it’s really just scratching the surface. SW: How are you adjusting for the changes that are part of NAR’s settlement agreement? HL: From a software vendor perspective, it’s not going to change a whole a lot on the core piece of the software. There are some small, very basic things that we’ve already changed, but now we’re having discussions about building features that make sense for our users in this environment. First of all, we’ll have to help buyer agents to present their value better. There’s now a whole different journey — from lead acquisition and from the marketing side. It’s important for our users to engage with the customer as soon as possible, so you will have to offer the experience for a buyer to quickly view the agreement and agree on using you as a buyer agent — this is what we want to optimize. We can help our users improve their speed to agreement. SW: What keeps you up at night? HL: Understanding the boundary of this technology. That’s really changed so there are some fundamental questions you have to think through. Is AI able to replace the agent? Is AI going to replace software? Our current answer is no for both of them. As an agent you are building a business, not executing a task. It’s maintaining a customer relationship, it’s rain making. So is AI so powerful that it can run a business? No. Can AI replace software? Software is not really in conflict with AI. Software is where users store their data to manage their business. Software is essentially a work bench. So that doesn’t keep me up anymore. What keeps me at night today is that we don’t really know what the industry is going to be like in the future and how fast technology is evolving. As I said earlier, we’ve already had to tear down our roadmap three times. As a product company, we’re looking at the new paradigms or framework for building a product. Building software right now is very different from the old days so we are staying vigilant and very focused. To be honest, it can be quite overwhelming because we’re receiving new information every day. I don’t really sleep a lot! It’s stressful planning, but at the same time, it’s very exciting because as the environment changes and technology changes — we have new opportunities. Making sure we don’t miss those opportunities is what keeps me up at night.

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