Regardless of how much you’ve paid for your house or the renovations you’ve made, price will always be determined by what the market will bear. According to Zillow Analysts, Sellers who price their home at fair market value tend to not only sell faster, but also sell for 2 percent more than their home is worth. If your goal is to sell quickly, the wisest pricing policy is to always price at or just below market value. A REALTOR® with the highest sales in your specific neighborhood will best be able to determine fair market value.
An affordable monthly payment encourages buyers to write offers faster. Help the buyer understand how the home will fit into their monthly budget. Prepare a financial worksheet for potential buyers so they can see at a glance what the taxes will be, average heating/cooling costs, average water bill, etc.
#3 House Condition
In today’s market, competition for buyers is steep, so don’t overlook home repairs, organization and overall cleanliness hoping potential buyers won’t notice. Little problems make them wonder what bigger problems could be lurking. De-clutter, dress up your curb appeal, and have the home professionally cleaned top to bottom to increase the likelihood of a successful sale. Also, the importance of ordering an upfront home inspection can not be understated. By disclosing inspection results to potential buyers upfront, you increase their confidence, as well as, maintain control over the sale of your home, limiting end of sale price re-negotiations. Studies show getting a home inspection prior to listing your home can save you up to 2% in repair costs vs. home list price.
#4 Current Market
Every market goes through a series of cycles. What affects your home’s price is determined by what is happening in your local area in reference to the economy, employment, etc. A top performing REALTOR® in your specific neighborhood will understand how to analyze and respond to local market conditions when strategically pricing your home for sale.
There’s a popular statement, “What sells real estate? Location. Location. Location.” This statement is only partially true. Although homes in more desirable areas sell for a higher price than homes in less desirable areas, pricing is still the most predominant factor. Since you have no control over location, shift your focus to pricing your home according to the market and neighborhood that you reside within.
Exposure, marketing, online tools, reputation, and connection are all vital to getting homes sold in today’s market. Listing with a top performing REALTOR® in your specific neighborhood will ensure you have someone experienced and skilled in how to market your home in the right places to a targeted audience for the quickest, most profitable sale.
Home selling is a competitive market that is constantly changing, by adhering to the “6 FACTS” above, you can sell your home with minimal hassle and for the highest possible return on investment!
1. Your Home’s Value Went Up
The recovery of the housing market has reached your home, and now it’s worth more. That’s pretty good news, especially if you’re hoping to sell. But if you’re planning to stay, your tax assessor has probably taken note of your house’s enhanced value (or will soon — homes are re-appraised regularly). And if you added a room, remodeled a kitchen or did anything else that required a building permit, know that the additional value will be noted. That can affect your payment in two ways. The first would be higher property taxes. If you pay taxes through an escrow account, that is, one-twelfth of the bill is tacked on to each mortgage payment, then you’ll see payments rise as taxes do.
2. Your Home Insurance Premium Rose
The cost of insuring your home can go up. This can be because its value went up, but it can also be because your credit score went down. A falling credit score might cause your insurance costs to rise dramatically. A drop from “excellent” to “poor” can more than double home insurance in 39 states, a recent study showed. (Other ways a poor credit score could hurt include higher interest rates on credit cards and higher car insurance rates.) Also, home insurance, like property tax, is often paid through an escrow account, so a higher premium will be reflected in a higher house payment.
3. You Had an Escrow Shortage
Your monthly escrow amount is an educated guess at what the actual totals will be (leaving room for a small cushion). If the balance goes below that, or worse, into negative territory, you’ll typically be given a choice of paying a lump sum or the option of paying it over a year (paying one-twelfth of the shortage each month). Couple that with higher insurance or property tax, and a house payment can go up pretty dramatically.
4. You Have a Home Equity Line of Credit
A lot of homeowners are getting — or are about to get — an unpleasant surprise when the repayment begins on a home equity line of credit. In many cases there is an introductory period when all you have to do is pay the interest. But when that ends, principal payment begins. And if you are not accustomed to budgeting for it, it can be a rude shock.
What You Can Do
Rising costs and inflation are facts of life, and the best you can do is to avoid paying more than you must. If you think your home’s appraised value is too high, you can appeal, but you have to follow the procedures required in your jurisdiction. If your credit score has dropped (or if you use credit so little you are concerned that you have a “thin file” or are at risk of not having a credit score), you can monitor your credit and there are steps you can take to bring it up to par. Even if you don’t plan to borrow money, there are plenty of reasons to keep your credit in top shape. (If you don’t know where you stand, you can get a free credit report summary that includes two credit scores, updated monthly, from Credit.com.) Lightly using credit cards, paying on time and keeping balances low can play a part in helping you keep housing, insurance and interest costs in check. That way, even if your payments do inch up, it won’t be as painful as it would be otherwise.
Making huge purchases right before you close on the homeBefore you go buy that new electric BMW just because Katie Couric and Bryant Gumbel told you to in a commercial, you might want to hold off until you close on your new house. O’Connor says lenders will re-check your debt load right before closing, and if you have a big ol' car payment on the books, they might rethink your ability to pay off the home loan. She’s seen lenders back out at the last second. This also goes for big furniture or appliance purchases, too. Might wanna keep that Sears card in your wallet until you move in.
Not getting your finances in shapeIf you assume you’ll have enough money to buy a home because you have the down payment in hand, guess again. First of all, checking your credit score is key -- it can determine the interest rate and insurance costs related to your new home. And there are plenty of pre-buying expenses you might not realize you need to pay for as well. “The more you can invest up front, the easier the loan process will be,” O’Connor says. “But throughout that process, in addition to applying for the loan, you also have to do things like get insurance for your homeowners policy in place. You need to have inspections. The lending institution will probably charge them a fee to have an appraisal, as well.”
Underestimating the ease of home improvementsIf you buy a fixer-upper, there are going to be myriad costs and time spent on getting the place in shape. But even if you buy a home that needs a few updates -- refinishing hardwood floors or remodeling a bathroom -- O’Connor cautions that “the projects will always take longer and cost more than you think.” Unless you buy a house that’s on an episode of Property Brothers, and then the whole job will only take about 45 minutes.
Not working with a trusted adviserIt might seem a little conflict-of-interest-y that a real-estate agent would recommend you work with a realtor when buying your first house instead of going it alone... but that advice also has the benefit of being a good idea. “If you have a professional helping coordinate everything, then the [home-buying] process will be smoother,” O’Connor says. “And they'll also be alert to what might be coming up along the way. There are ways, if you have an agent representing you, that they can negotiate with the seller to pay your closing costs.” And it’s not just your agent that can help -- if they work from an office, “they bring to the deal a whole team to support the process and guide you right.” Just because you read one news article on Trulia about how to buy a house, that doesn’t make you equal to an agent’s years of experience in buying and selling real estate.
Not taking a long-term outlook on your purchaseIf you’re buying a house in a town with bad schools (aka any school Michelle Pfeiffer might teach in), but think it doesn’t matter because you don’t have kids, think again. “You might say, ‘Well, I don’t have kids, so schools don’t matter.’ To the next buyer, those schools might be very important,” O’Connor says. Also, will this home have room for you and someone else if you get married? Will you be able to sell the house if you have to move? Before you drop any money on a home, those are questions worth thinking about.
Choosing the wrong lenderThere are plenty of lenders out there, eager to give you a loan worth hundreds of thousands of dollars. But is the lender reputable? O’Connor recommends asking around to find out if the lender delivers on promises, whether they be the rate or the timeliness of the loan. She cautions that lenders call the shots for a simple reason: “Those who have the gold make the rules.”
Working with the wrong real-estate agentSelecting your agent by whoever comes up first on your Google search of “good local real-estate agents who get turnt on the weekend” isn’t the most sound strategy, despite it giving you someone else to hit the bars with. However, you do want to find someone with whom you connect with, O’Connor says. Do you get along personality-wise? Does their schedule mesh with yours? Interview a few! Get recommendations. Finding the right person is a huge deal. Finding the wrong one can be hugely detrimental.
From: thrillist.com by Lee Breslouer
Tress Realty Group compiles some of the best real estate news, tips, and information for buyers, sellers and investors.