Should you sell in 2012? Barring any Mayan insight, let’s trust that the catastrophe of the real estate market has passed, although we may have to navigate through the remaining rubble.
An overstock of households with loans higher than their current market value will continue to restrain prices and create obstacles for sellers in a year that is starting out to continue as a homebuyer’s market. With that said, even the most conservative forecasts are calling for growth in home sales this year. Locally we are experiencing multiple offers more frequently on newly listed properties. Over one-third of the home sales made last year were to first-time homebuyer’s. Both are good signs.
While we are in a state of recovery, here are seven tips you may consider before selling.
#1 Price it right from the start.
Now is not the time to go old school and “fish” for offers. Most homebuyer’s will look right past you. Consider that of the homes that took more than 4 months to sale last year, almost half of homeowner’s accepted less than 90 percent of their asking price, according to the National Association of Realtors. Be sure your agent produces the latest comparables (no more than 90 days) and that they include short sales, foreclosures and bank owned properties. As a seller, I know it is difficult to compare your home to distressed property sales, but it is necessary. Also, ask for a summary of sales price as it compares to original asking price. The last thing you want is to be tied up in escrow only to have the appraisal come in low and be faced with either losing this buyer or making a concession on price.
#2 Don’t do comps on the internet for your home.
Checking seemingly reputable websites to find a value to place on your home is a huge mistake. Are you perplexed by the value being 25% lower than you expect, but going to trust the value if it is 25% higher? An appraisal is the truest form of value. Online values don’t have access to all of the facts in order to evaluate the property properly. Nor have they been in your home or any of the competition. They don’t know if a recent sale allowed $10,000 of buyers closing costs being paid by the seller. They don’t know if your home is custom built or mass production built. An appraiser will know, as well as, any highly regarded, educated real estate agent.
#3 Put your best foot forward.
Paint, stage, clean, de-clutter, make small improvements and repeat. If it squeaks or sticks, oil it. If it is chipped or leaks, repair it. If it has spots on it, clean it. If it is overgrown, trim it. Make your home say “buy me” from the sidewalk and hug potential buyers upon entering.
#4 Be flexible.
You no longer have the luxury of showing disinterest in “low ball” offers. Every offer should be reviewed and considered. If a buyer has a misgiving about your home, which is likely the driving force behind the offer price, then find a way to start a conversation with them. Listen to what they have said and find a way to meet in the middle with repairs, credits, etc. That’s not to say you have to give away the farm, but be accommodating to your needs (not wants) and those of the buyer.
#5 Finance 101
Even though rates are low, understand that it's harder to qualify for loans. Credit records are under greater scrutiny and lenders are sometimes requiring a 20 percent down payment. Have your agent provide loan information at your home, just in case the potential buyer isn’t aware of special financing for the state, county, city or specifically the property.
Consider cash offers, even if they're not the highest. Reject too-low offers gently (preferably with a counter-offer to keep the conversation alive). These days, meeting halfway usually means meeting buyers on their half.
#6 Don’t fall prey to fraudulent investors.
Unfortunately when the chips are down, some will find a way to use that fear to serve themselves. Con artist investors may offer you “help” by offering to let you stay in your home, while they take over payments. They encourage homeowners to sign over their home with a quitclaim deed. Do not sign without consulting an attorney. You may be surprised to find out that some attorneys review documents for minimal fees and do accept payments. Additionally, your own mortgage company can review the documents and cannot charge you for the service. Others will approach homeowners with “deals” that sound legit. They offer their assistance and knowledge for an up front fee. Remember that a law barring firms from charging upfront fees for mortgage relief or mortgage modification took effect last year (The Mortgage Assistance Relief Services Rule).
#7 Embrace technology.
Hire a listing agent that uses social media, Youtube, Craigslist and dozens of other online sites to get the most exposure for your home. Sellers and buyers are routinely using these types of sites to sell and search properties. Ask (if not, insist) your agent saturate the online market with the details of your home.
Crista Martin, Associate Broker, ABR, GRI, e-PRO
208.577.7157
CMartin@Atova.com