Seller Considerations – Stock Market Drops 200 Points
For the past couple of months there has been lots of encouraging news that has led many sellers to throw caution to the wind by believing that the worst is finally behind us. This may be true, or not! There are still a number of potentially devastating economic considerations that could put the breaks on any recovery, especially the fragile improvement presently being experienced.
Every seller is well aware of the impact that a sovereign debt default in Greece could have on the US economy. Recent actions taken had originally calmed those fears. Today renewed concerned that a Greek bail-out may not be possible, as the DOW Jones Industrial Average (DJIA) dropped more than 200 points. This was the first big loss of 2012.
Keep in mind, if Greece defaults, it would be the first sovereign default of a European Union member. It could also be the “canary in a coal mine” for many more sovereign defaults that could include Spain, Italy, Portugal and Ireland. If the EU (European Union) were to eventually break up, the impact on the United States would be substantial. A credit downgrade would be likely. The extra cost of funding our debt, would likely put the US economy in a tenuous situation at best.
But wait, there’s more. The stock market was also responding to reports that China’s economy has somewhat cooled. Remember, the Chinese economic engine has fueled worldwide economic improvement. If China’s economy continues to cool, and other European countries experience recession-like activity, the US economy could once again be in trouble.
As a seller, or prospective seller, these and many other economic conditions must be considered in managing the risk or additional loss. Every homeowner thinking about selling should ask themselves,
“Does the risk of future economic pain, justify taking advantage of the selling window of opportunity that exists right now???”