Getting the Best Value for Your Home - Pricing Your Home to Sell

Most sellers today are nervous and unsure. They wonder: is taking a loss on our house inevitable?

The answer is no! A strategic sales plan, coupled with a smart buy in your new location will ensure that you recoup the maximum value for your home.

Your Strategic Sales Plan

Consult with an expert, local real estate agent to ensure your house is priced competitively and well-staged. Why? Because while there are always three factors to getting a home sold—location, price, and condition—only two are under your control: price and condition. Of the two, which is more significant? Price. Remember that price will correct bad condition, but condition will never overcome a bad price.

Act fast. You’re in a race against time—the best price you’ll get in today’s market is the one you get now. If you wait, it will be lower. And every month the price on your home decreases, your costs remain the same. For example, Keller Williams research shows that sellers who listed their home at the price the agent originally recommended, sold the home 38 days faster. This is over a month of mortgage and tax payments! For a home that cost $200,000 at time of purchase, with 20 percent down and an interest rate of 6.5 percent, selling a month sooner results in a savings of $1101.31 for the mortgage alone, not including the taxes and insurance that the homeowner would be paying during this time.

Don’t worry about where the market has been, keep your focus on where it is going. The price your neighbor down the street got six months ago is not relevant in a market where your house is competing with others from all across town. Again, a local real estate agent will have the kind of long-term, wide-ranging data that will help you decide how to pinpoint your price with precision.

 

Your Smart Buy

Move up. Whether you are moving to an area where prices are in a downturn, or dreaming of nicer, bigger, home in your own town, selling your house now can get you into the home of your dreams. Falling home prices are a great opportunity for a savvy homeowner looking to move up. Even though your house price may be lower, the smaller loss at sale can be made up by greater savings at purchase. For example, let’s take that same $200,000 home, and imagine that it has decreased in value by 5 percent, reducing the sales price to $190,000. At the same time, let’s imagine that you would like to move up and the $400,000 home you have been eyeing has also decreased by 5 percent. That’s a savings of $20,000, and it is a home that is likely to be better positioned for appreciation when the market rebounds.

Bottom line: don’t pit yourself against the market, work with the market to get the most out of your house sale.

Do You Know a Homeowner Facing Foreclosure? Here’s A Way Out.

Headlines today are filled with stories about homeowners in financial distress—people who face a lender’s foreclosure on their home.

Millions of American home owners are wondering what to do.

Like most crises, this one has produced its share of rumors and misinformation. One of the biggest ones is “just let it happen.” Why fight back, this line of thinking goes. It’s too emotionally draining, and the government’s loan modifications aren’t helping many people. Well, that’s only partly true.

While government loan modification programs have fallen short of the mark so far, there is another solid, sensible option for homeowners. It’s called a short sale—a sale to a buyer where the seller’s lender agrees to accept less than the full amount owned.

Why not be foreclosed? Why sell short? Agents who have closed hundreds of these transactions provide this list of reasons:

Avoid the foreclosure stigma – Homeowners will always have to disclose that they had a foreclosure on any mortgage application and (many job applications) that they submit in the future. This can have an adverse affect on their future mortgage rates. Foreclosure is asked about specifically in credit inquiries. There is no seven-year time limit on this item.

Protect credit score – Credit scores will be lowered by 300-plus points (per loan) by foreclosure. The impact of a short sale—about half that much.

Improve eligibility for a government insured loan – The homeowner will be ineligible for a government insured loan for 5-7 years (only two years in a short sale). A foreclosure is the one credit report item that is almost impossible to have repaired.

Avoid a deficiency judgment – Lenders can seek a deficiency judgment against the homeowner and collect any amount they do not recover at sale.

Protect employment prospects – Many employers run credit checks on prospective employees. Foreclosure is one of the top items that will put a potential new hire, or even current employment, in jeopardy.

 

These are the top reasons, but there are more. An expert short sale specialist agent can give a full picture of the options.

 

One more tip. Don’t believe everything you read about how long short sales take and how few get finalized. Short sale timelines, while still longer than normal, are shrinking as lenders get their paperwork act together. Find out who the top short sale agents are in your market. These pros are closing 70 to 90 percent of the short sales they represent—more than three times the national average. They know where to find buyers, and how to negotiate the buyer’s offer effectively with lenders and get the deal closed—so the homeowner can move on with life and recover.

Stage It, Sell It, Profit!

Turn on any popular home network on cable TV and you’ll find a program on staging.

Re-arrange your furniture, pick a soothing color palette, clear out the family photos, and your home will sell faster, and for more money. Sound too frou-frou to be true?

 

It’s not! The soft and decorative side of staging is backed by hard facts.

Real estate agents like great-looking homes because they are easier to sell. Why is that important?

 

An agent’s job is to please their clients, and they will direct their buyers to the homes they think they will buy.

Agents talk to other agents who are also directing their buyers to the best homes on the market. An attractive listing will be shown more often, meaning more market exposure—critical for a quick and profitable house sale.

Staging is non-negotiable in many parts of the country. Staging a listing for sale in an area where the concept hasn’t caught on can give you an advantage, particularly if there are many unsold listings similar to yours on the market. Buyers gravitate to listings that look good and are in move-in condition.

Buyers are looking for value. When prices are flat or on the decline, buyers need to perceive that the house is worth the price.

Bottom line: staging is more than an exercise in tasteful interior design. It is a business decision that can have a huge impact on your financial return and timeline.

Prepping Your House for Sale

Potential buyers get an impression of your home – either positive or negative – within 30 seconds of walking through the door. Having them see your home in tip-top selling shape is an absolute must.

There are countless ways to put the freshest face on your home, many of them costing little more than a bit of your time. Here are a few pointers for the most significant impact:

Outside: The Power of Curb Appeal

 

• Clear any clutter and keep lawn decorations to a minimum.

• Mow your lawn and trim shrubs.

• Add bushes and/or colorful flowers.

• Sweep sidewalks, porch and driveway.

• Remove or update any dated or personalized fixtures.

• Put all toys away.

• Fix damaged gutters, shutters, siding or roof shingles.

• Add a tasteful welcome mat to the front door.

• Clean all windows inside and out.

 

Leave your house while it’s being shown to potential buyers. Your presence can make them feel anxious and awkward.

 

Write a letter about your neighborhood that your real estate agent can share with potential buyers. Include information on local events, neighborhood amenities and other factors that define the community.

 

Inside: Leave No Trace

 

Clean everything! Check for cobwebs on ceilings, dust on baseboards – everything.

De-clutter. Then de-clutter again. Rent a storage locker if you need to. This is very important for increasing your home’s appeal.

 

• Add a fresh coat of paint to the walls.

• Remove family photos and excessive wall decorations.

• Remove personal items, such as DVD collections and trophies.

• Replace worn carpets, and shampoo carpets that are dirty but still in good shape.

• Polish wood floors.

• Add fresh flowers or plants, but don’t overdo it.

• Maximize your home’s natural light by opening blinds and shades.

• Do a smell check and address any odors.

• Pet owners: Take Fido or Fluffy with you while your home is being shown.

Your agent can provide additional advice on prepping your home, and also give you insights into the preferences of local buyers.

Consider a Home Inspection When Selling

A home inspection isn’t just for buyers. It’s also something sellers should seriously consider before putting their house on the market.

Why? Quite simply, you don’t know what you don’t know. Imagine getting a great offer on your home only to discover, during the middle of the process, that it needs considerable repairs.

This is the kind of surprise that can lead to buyers pulling out, costing you time and money on a number of fronts. It’s better to know problems from the start, and either deal with them before listing or price the home accordingly.

A seller’s inspection also provides a reference point from which to compare the findings of the buyer’s inspector. In particular, having a different professional opinion can work to your advantage in price negotiations.

Your home inspection is a sales tool

Having your home inspected before listing can also be an effective sales tool. You can confidently say that your home has been pre-inspected and is in tip-top shape, making that much more attractive to buyers.

 

Don’t wait too long for a home inspection. You want plenty of notice for repairs before you start marketing your home for sale.

 

Attending your home inspection

Attend your home inspection to see first-hand what the inspector notes, and to learn some important details about the house that may assist you in selling.

When attending your inspection:

Wear casual clothes and comfortable shoes. You may find yourself crawling under and behind things to see what the inspector is pointing out.

Plan for the inspection to take two or three hours.

Feel free to ask questions, but give the inspector time and space to work.

Home Inspection Checklist for Sellers:

Remove clutter that may get in the way of key inspection areas, such as water heater, furnace and main valves.

Clean up! A clean house shows you care and that you’ve maintained the property properly.

Provide full access to attic, basement, crawl space and garage. Leave the keys if they’re needed to enter these areas.

Provide repair documents. If you’ve done any remodeling or replaced the roof, furnace or electrical system, provide the paperwork. Also, display any paperwork about new appliances that may be included in the sale.

Leave utilities connected if your house is vacant.