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By Ruthie Gagne
Right now the Winchester real estate market is going through an interesting time. There are two trends of home sales— homes that sold basically before they were even on the market (not really, they were on for a short period of time before being gobbled up and sold above asking price), while other homes that seem as lovely and unique as their counterpart homes, take much longer to sell.
What is the most noticeable difference between the homes in these two different categories? The answer in this current market is how up-to-date the home is. The ‘pretty’ homes, those with updated kitchens and bathrooms, lots of light, fresh paint, well-tended garden beds, regardless of the price point or the actual cost of having these features, will sell like hot cakes. On the flip-side, those homes that may need a little work, or homes with unique qualities (i.e., slanted floors, smaller windows, lower ceilings) end up remaining on the market for longer. Therefore, if residents are thinking about selling or are looking for ways to increase the reasonable asking price of their homes, updating intelligently is the best bet to increase a return on investment. And vice versa if buying; there is a huge opportunity to gain even more equity from a home that is not all ‘pretty,’ with other people’s preferences.
A few words of caution, however – when updating a current home, sellers should be mindful to not accentuate the contrast between the updated areas and the more original parts throughout the home whether in the same area or not. This is because if one area stands out as being very updated and modern, the other areas will stand out just as much, but negatively. This would then decrease buyers' desire for the home, meaning that update actually hurt the seller’s bottom line, not only because of the money invested in it, but also the decreased return. Sellers should avoid updating one major thing and instead should work on multiple smaller projects. For instance, instead of updating the pool, it’s better to give all the rooms a fresh coat of paint. But not if the roof needs work.
So, how is the Winchester real estate market?
Well, it depends – is someone buying or selling? And though these goals are obviously related, they are emotionally diametrically opposed: Buying is an emotional-rooted decision, usually based on a family’s needs and wants, and is heavily dependent on how the home makes them feel, or how they see themselves living there. Selling on the other hand, is much more financial and should be much less emotional: the goal is to maximize the financial return on the seller’s nest-egg investment.
How do the rising interest rates affect our market?
The answer is (fortunately, or unfortunately) rising interest rates seem to have less of an effect on Winchester's real estate market than we see in other areas. That is because with the low inventory, coupled with high demand, leading to homes often going over asking / appraisal, potential buyers can only present truly strong offers if a good portion of their offer is in cash. Because banks will only lend the appraised amount for a home, anything above that price (aka, what buyers present for over asking, their ‘emotional’ price) will need to come from cash. Therefore, many buyers in today’s limited market are still looking for their next home and can afford to compete in this market.
Ruthie Gagne is currently with the Winchester office of Barrett Sotheby’s International Realty and the founder / CEO of Gagne Real Estate. She is also a precinct 3 Town Meeting Member.
