Price it low and let it go, or price it high and hope they buy?

Price it low and let it go, or price it high and hope they buy?

Understanding your homes true value

                        Unlike the stock market, commodities trading, or simply the price of milk, there isn’t any “set” value for Real Estate.  We have different and separate values to review, but no true calculation of fair market value when discussing Real Estate.  Sure, we have averages and comparables to review – but besides that, if seeking true market value we are simply left to our own devices.  This can be a hindrance or can be beneficial depending on how you strategize your homes sale.  If evaluated correctly your home will sell in a speedy timeframe and for top dollar.  Done wrong and you’ll be leaving thousands in your buyers pockets.  Take these considerations into account when estimating fair market value for your home.

Understand your Comparables

            The number one factor we have when calculating Real Estate value are our comparables, or ‘comps’.  Comparable home sales in your community will give a good understanding as to fair market value for a particular home.  Understanding what buyers are paying for however is a crucial step when strategizing.  Simply viewing a sales price, beds and square footage is not enough, many factors need to be reviewed and understood.  Upgrades, Lots, Views, Pools, etc. are all factors that will have a significant role in a homes value.  Price per square foot is a start, but it’s certainly not the end game when deciding list or prospective sales price.  Owners and agents must take into consideration factors that will increase or decrease value based on comparables.  Be proud of what your home offers, and don’t be afraid to ask a premium for your upgrades or lot features.  When the original builder sold the home, premiums were added for these items, why shouldn’t they be now?

Know what you’re up against

            An often-overlooked piece of the pie when pricing is to understand what you will be up against when listed.  What other homes are currently in inventory when you are going to market?  A simple tip to help understand your competition is to see it!  Football coaches spend hours studying the opposing team before game day to understand their opponents weaknesses and strengths, why not do the same?  Once an estimated price range is reached, spend some time reviewing what buyers will be seeing before or after touring your home.  What benefits do you have over others and vice-versa.  Obtaining top dollar takes knowing the competition and reacting to it effectively. 

What does Uncle Sam say your home is worth?

            We all get tax bills and as you know these bills are calculated on value of property.  What many homeowners don’t realize is that the county sets values according to market conditions as well.  While the value cannot be consistently up to date as it is completed on an annual basis, it gives a good starting point to understanding what your home is worth.  The county appraiser will show two separate values – Just Market Value and Assessed SOH value.   A quick study of information provided by the county will tell you that ‘Assessed Value’ should sit at about 80% - 90% of your homes current fair market value.  Use their calculations to your advantage; at the very least it will let you know what range to not price below.

            With due diligence and proper guidance acquiring your homes value is not as hard as some may think.  Use these tips and tools to understand where you actually sit in today’s market.  Your home may be worth more then you or others think!

           

The Three “P’s” to achieving TOP Dollar!

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The Three “P’s” to achieving TOP Dollar!

            If in the market to sell your home, you probably want what all home sellers want.. Top Dollar!  Many sellers however do not always understand what it takes to obtain top dollar, often placing themselves in a “behind the 8 ball” position.  When this takes place optimism can quickly turn to pessimism, making your sale much more stressful then necessary.  If a top dollar sale is the result you are hoping to obtain, these three simple tips can and will help you start out on the right foot.

Price

            You needn’t be in the Real Estate industry to understand the importance of pricing correctly to obtain true Top Dollar.  Under pricing positions you in a quick sale low profit situation, and over pricing places you in a wait and hope situation, neither of which will produce the results you desire.  Pricing too low, while obviously netting you less, can lead buyers to assume something is wrong with the property.  Too high and your traffic will be low to nil, with any offers coming in generally being low ball offers.  Work with an agent who understands both the values of the community you are in as well as the value your home offers in current market conditions.  Pricing in an aggressive but realistic manner will bring higher levels of traffic as well as justifiable offers, often leading to a top dollar sale!

Photos

            You wouldn’t post a fuzzy, off center picture of yourself on Facebook – so why do it when selling your home?  I’ve seen time and time again lackluster photos of homes for sale in the MLS.  Pictures taken with cell phones, a picture focused on a table when trying to show a dining room, people in the background, etc.  In this day and age, with Internet search being the #1 source of interest from homebuyers we simply cannot be as cavalier with our photos.  Pictures SELL, so please be sure to have your home photographed by a reliable source or at the very least be sure to show the home in it’s true best light.   Wide angle lenses, correct lighting, crisp and focused images, these are imperative parts of the process if you demand top dollar.  A cell phone doesn’t cut it, do it right and your home will shine, do it wrong and there may be no contract to sign.

Promotion

            Promotion and marketing is simply crucial if seeking top dollar for your home.  More interest brings higher dollars; it’s a simple fact to understand.  As your buyer base grows, your value grows with it.  Many agents will place your home on the MLS and hope for the best.  This strategy is dated by decades, and while it can and may bring offers, they will often not be at the highest amount possible.  Local advertising, social media marketing, video tours, high quality photos and pertinent ‘on-site’ information are necessary if your goals are to obtain the highest amount possible for your sale.  If in the market be sure to work with an agent who provides this type of marketing on a consistent basis.  More exposure equals more showings, which in turn brings higher offers!

            We all want the best for ourselves, in life and in any and all monetary transactions.  With the right strategy and team put into place for your homes sale, you can make the best outcome available a reality!

A Reduced Commission may put you in a Tough Position.

A Reduced Commission may put you in a Tough Position.

            “My mothers co-workers niece’s roommate is a Realtor, she’ll lower her commission for you”.  These days it seems everyone has a friend of a friend who has a Real Estate license.  Finding an agent to work for less may seem sensible, but choosing the wrong one just to save a point or two can quickly put your homes sale in a tough position.  Everyone wants to save some money, but if thinking of going the ‘cheaper’ route, take these points into consideration before you sign that listing agreement.

Less Work = Less Money

            If your lawn service only mowed your back yard you wouldn’t consider it superior service, would you?  When selling, if you demand top dollar, the marketing of your home requires top tier exposure in every light.  From MLS marketing to magazine advertising, if it’s not done correctly you can be sure to receive a reduced offer along with that reduced commission.  Agents whom offer to work for less often do so because they simply do less work.  A true professional agent can and will acquire a high dollar amount over and beyond any savings a 1% reduction on commission will give you.  In turn having their hard work net you more.

It may be slow going with few showings

            Realtors work for a reason, sure they love their jobs, but they work for money just like the rest of you.  When an agent sees a home with a reduced commission, they may show it, but it will often be at the end of the list.  Some agents may hold off completely on sharing these listings with their clients.  Ethical? No.  But it’s not a secret that it does happen.  Advanced exposure is the key to obtaining top dollar for any type of sale, reducing your showings out of the gate is a sure fire way to reduce your marketability value.  Offering a full rate standard commission to buyers agents ensures you won’t be ignored.

Don’t cut down The Giving Tree

            A favorite book of mine growing up was ‘The Giving Tree’.  A young boy continues to take from his favorite tree until it is nothing but a stump; with ‘nothing left to give’.  There may arise a time during negotiations where buyer and/or seller are close to final terms but neither will budge on final perceived value.  At this time, many agents may offer to contribute a portion of their commission to make the deal go through.  If an agent has already given their share to begin with, there may be nothing left to give shall the situation arise.  Save commission reductions as an ‘if needed’ request and the agents involved will do their job to obtain true top dollar for your home. 

           

            ‘You get what you pay for’ is the best advice I can give to anyone pursuing a low commission agent.  Be sure to look at the big picture; if you let saving a few bucks jade you, you just may end up paying more in the long run - for sub standard service.  We all love saving money, but if the cost of saving exceeds the savings themselves, you’ve done yourself a disservice.  

Selling on your own?

Selling on your own?

            With market conditions on the rise, many homeowners are facing the reality of a positive net sale.  While 98% of home sales are procured by a Realtor, there are still some homeowners who wish to sell on their own in hopes of saving the standard commission due on a Realtor procured sale, but is it this a prudent decision or simply penny smart and dollar foolish?  If in the market to sell on your own, or doing so currently, take these factors into play to strategize your best plan of action.

Have you got the time to save a dime?

            When buyers have interest in a home they want to see it as soon as they possibly can.  As our technological world has made waste of the standard 9-5 workday, many buyers have schedules which allow them to be out and about during what was once considered working hours.  If you are not available to show your home to potential buyers when convenient for them, you instantly put yourself at the end of their list of interest.  A Realtor’s job is to market and show property 24-7 that’s simply what they do.  If your schedule does not allow you to show your home at anytime convenient to a buyer, working with an agent can and will allow more showings, in turn bringing more offers for a potential sale.

A ‘For Sale’ sign is not sufficient advertising

            The name of the game in Real Estate sales is exposure.  You can’t sell at a premium if no one knows what you’re selling.  While a “For Sale By Owner” front yard sign tells the public your home is on the market, the demographic that sign reaches is extremely low.  To obtain true top dollar a seller needs to obtain true exposure and marketing of the home for sale.  Print adverting, On-Line marketing, postcard mailers, video brochures and more can and will bring a higher dollar amount simply be educating more potential buyers on your specific property.  Marketing properties in the correct way is a task that most Realtors excel at, if trying to obtain top dollar – work with an agent that markets the home in it’s best light, correct marketing alone can bring you a higher net amount then if selling on your own.

Are you a Legal Eagle?

            Knowing how a contract reads, what factors to be aware of and how the terms can affect you may be the most crucial reason to work with an agent.  If selling on your own your only true step to legal security is to obtain a lawyer’s advice; this service however can be obtained by simply listing your property with a licensed Realtor.   An agent can and will explain, direct and protect you throughout the entire transaction.  Knowing which hurdles to look and be prepared for may not only save you money, but can also save your sale.  I’ve seen sales lost for simple lack of knowledge many times, if selling today or in the future it’s always smart to hire an experienced agent to have your legal “back”.

            We all love to save a buck or two – it’s in our nature and there’s nothing wrong with it.  However, if the hopes of saving money put you in a less then stellar sales situation – ask yourselves, is it really worth it?

On-Line Real Estate Search

            With public access to Real Estate listings via the Internet many buyers in this market conduct research on their own, and while a lot of information can be discovered on-line, the most essential details are often left out.  Knowing how to decipher a Real Estate listing and what data to factor into your search may seem as easy at 1,2,3 – “I want 4 bedrooms, 3 baths…” – but in reality searching for the right home can be more of an algebra problem then simple math.   Take these factors into your next home search and you just may master the equation.

Active, Pending, Backup?  Oh My!

            The number one issue I see, hear and read about regarding on-line Real Estate search is that a large portion of homes of interest are no longer on the market when requests to view are made.  No one likes misleading information and this can often feel that way to prospective buyers.  As many of the popular Real Estate search sites don’t show current “status”, a buyer is left with no other opinion then ‘here’s a great home for sale’.  In actuality however, the home is no longer on the market or has been sold months ago!  As true up to date information of status is generally reserved for Realtors, it’s a good idea to check the status with your agent prior to mentally placing furniture in your new home.  An active status sale is on market with no current offers, pending means a contract has been executed and the home will close pending inspections or other factors necessary, and a backup status listing simply means while a contract has been executed the seller will consider back up offers shall the current contract become void or cancelled.  Understanding these points and jargon is step one when searching on line.

Important Financial Factors

            Perfect pictures and a wonderful description can make anyone excited about a home, but to fully protect yourself and be sure you are within budget you need to put other factors into play.  As many homebuyers will be purchasing with a mortgage, monthly fees can often drive or end a home purchase transaction.  Many varying costs of ownership are often not listed on the popular search sites.   Fees like HOA dues, taxes, additional insurance necessary and others are crucial elements to be aware of.  An exorbitant HOA fee or high tax rate can quickly put a home you thought affordable out of your price range.   To verify additional fees that you may not be aware of be sure to work with a Real Estate agent or ask the listing agent directly.  Planning results in protection, do your work and guarantee a successful sale.

Beware the bait and switch!

            Like all forms of marketing, some is ethical and honest while others are misleading and false.  Forum and blog sites that advertise Real Estate often lean to the latter.  Unethical agents have and will advertise properties that have already been sold, or at unapproved prices with hopes of landing a buyer call on the false advertising.  This is commonly referred to as the ‘bait and switch’.  To avoid being baited try to stay away from forum or blog like sites offering Real Estate for sale.  As at all times, your best bet is to work with a Realtor, but if searching on your own be sure to conduct your research on a viable and ethical site.

            Keeping these simple ideas in mind will save you time, frustration and possibly money!  If in need of true data always consult a licensed Realtor, they are and always will be your best source.

The 3 most important factors in choosing an agent

The 3 most important factors in choosing an agent

            How many Real Estate agents do you have to choose from?  The term “a dime a dozen” comes to mind, doesn’t it?  The truth is, yes, there are a ton of Realtors available at your disposal.  There may not be many however who can provide all you need to obtain your buying or selling goals.  Protect yourself and take these three factors into account when selecting your next Realtor.

Honesty & Ethics

            There may be no more important factor then that of honesty and ethics when choosing a Realtor.  Working with an agent with low ethics or one that you cannot trust to be 100% honest throughout the process is a recipe for disaster.  It is imperative that you work with an agent with strong ethics and an inherent character of honesty.  Many agents will skew the truth to obtain business.  I’ve seen some go as far as to pose with someone else’s wife and children to give the impression of a “family based” agent.  I can’t imagine how this person would react when asked about their wife and kids.  Starting a business relationship based on misleading advertising is a surefire way to create future issues during the transaction.  If you’re not working with an agent who is 100% honest and ethical, how can you truly be sure you have obtained an agent with your best interests at heart?

Advertising & Marketing

            When selling your home it is crucial that you work with an agent whom firmly understands the importance of advertising and marketing.  While the MLS alone can drive sales, having an agent who knows how to implement an advertising campaign personalized for your home is essential.  Many agents will tout the campaigns offered by their firm and most will count on this marketing alone as the only means to promote your property.  In these scenarios the home never receives any true personalized campaigns, and simply obtains “cookie cutter” marketing. Selling at a high dollar in a short period of time requires constant promotion in new and unique ways; and more importantly personalized to the subject property.  When interviewing or searching for an agent to sell your home, be sure you delve into their own personal marketing strategy, find out what they as an agent bring to you, the client. 

Knowledge of your area

        Selling a product that you are unfamiliar with is a fool’s errand.  I’ve seen time and again agents with listings in areas they have zero knowledge of.   Without a firm understanding of the locale you are selling in, there is absolutely no way to obtain top dollar for the inventory you hold.   When selling, be sure that your agent is well versed in the area you reside in.  Knowledge of your area’s schools, shopping, entertainment, etc are crucial.  The convenience an area provides can often add value to a buyer’s perception of the home, in turn, netting you a higher sales price.

        These 3 simple factors will help you decide which agent is the right fit for you.  The wrong partnership is a disservice to the entire process; be sure to conduct your own personal research prior to hiring your next Realtor.  When you find the right fit it just may be a match made in heaven, brining along with it an attractive sales price in a short amount of time.

I Sold Short… When can I buy a new Fort?

I Sold Short… When can I buy a new Fort?

            Short Sales have become standard fare in recent years.  A term that many could not define just 5 short years ago has quickly become the topic of table discussion throughout the country.  What was once an embarrassing scenario has, over time, become the norm.  There is no longer a loss of pride in selling short; it’s simply a strategy to better yourself and your financial position in the world we live in.  So if the Short Sale has become as common as a Kardashian eyeing you in the checkout line, does that mean it’s getting easier for a short seller to become a bountiful buyer?  The simple answer… YES.

Wait two years, and there may be cheers!

            Lynn Whitefall of Supreme Lending states that while many may be surprised, there are in fact loan programs out there today that that allow a short seller to purchase a new home in as little as two years from short sale closing date.   Banks need loans to profit and as many buyers in recent years fell into the same under water situation, they need to write loans once again to stay in the black.  Regulations have been modified to “repair” the bursting of the bubble we experienced.  Banks are allowing previous short sellers to purchase just 2 years after their short sale if taking a conventional loan with 20% down, or after 3 years if acquiring an FHA loan.  What was once a means to an end has become a feasible way to push the reset button.  If you sold short in the past or have to sell short in today’s market, don’t fool yourself – you CAN be a homeowner again!

Maintain your credit - don’t forget it!

            Home owners in under water situations can and have taken their frustration to exorbitant levels.  Some owners, so upset with their short sale situation, will knowingly destroy their personal credit as well; they’ll stop making payments to other creditors or simply rack up credit card bills without a plan to pay.   It is imperative that these factors don’t take place if you have goals of homeownership in the near future.  While banks are accepting loan applications from previous short sellers, credit worthiness is always going to be the main factor in their decision.  If your home is underwater, that’s one thing, but be sure to continue payments with your other creditors to maintain a strong score after the short sale clears.  Some brokers will refer to this as a strategic short sale, selling short with plans of purchasing again.  Keeping your credit score in check can and will allow you to buy once again, in as little as 24 months!

History repeats, but you don’t have to

            The time has come; you are in the market to buy a home once again!  Slow down Old Sport, I know you’re excited but let’s plan accordingly.  We all know how it feels to get past a life-effecting barrier; the excitement can be contagious.  Now more then ever, however, you need to be fully prudent, honest and responsible regarding your next home purchase.  Excitement can often lead to bad decision-making, over spending, and a lack of due diligence.  We don’t want to be in the same situation once again, so be sure to move forward with caution and care.  Work with a mortgage and Real Estate broker who will fully explain the terms of your loan as well as true fair market value of the home of interest.   By completing these tasks before you go to contract, you will be less likely to become a short seller again.   

            If in the market after a short sale situation or in need of selling short today, please contact Rick Rapp at 954-873-1801 for your Real Estate needs.