Andree Raid: Residential Property Sellers and Landlords Need to Become More Flexible

The number of buyers and renters interested in the residential real estate market has decreased and is feared to continue declining. Real estate sellers and landlords must respond to changing market conditions. This means that real estate providers must be flexible and cannot carelessly ignore any potential buyer or renter.

Recent news on economic forecasts suggests that we are in the third year of economic downturn in a row. Due to increasing unemployment, there are fewer people in the real estate market who can afford and dare to purchase property. The willingness to rent apartments is moving in parallel with purchase interest – both are declining quite steadily in 2024.

Supply is not lacking

The number of apartments for sale or rent is large or even very large compared to demand. This means that on the supply side of real estate, competition is fierce and to reach a deal, one must put in more effort for each client than before. Otherwise, a home buyer or renter will find another provider who puts in more effort.

Sellers of residential properties and landlords should not overlook price offers or other conditions presented by potential buyers and renters.

One should not necessarily follow every unrealistic demand for discounts. It is reasonable for a real estate seller to do calculations – for example, is it worth granting the discount the buyer is asking for? Or should they stick to their price and be prepared to extend the sales period, paying interest on the existing loan and utilities for the apartment during the longer sales period? A landlord must also consider the same concerns with an empty apartment – the bank requires loan payments and coverage of building association fees regardless of whether there is a tenant.

A seller's market has become a buyer's market

For many years previously, the power in the residential real estate market has been in the hands of sellers, but by now it has turned into a buyer's market. Sellers of real estate and landlords must take into account that buyers and renters have a wide choice. If buyers and renters cannot reach a deal with one provider, it is easy to go to another.

Sellers and landlords of residential properties are wise to go along with small ideas that stay within the limits of what buyers and renters consider reasonable. This helps mitigate the risk of the sales period extending too long or rental properties remaining vacant. In the case of larger discounts or special requests, it is worth considering and calculating, but one should not carelessly give up on a client.