One of the most stressful times during a real estate transaction can come after the inspection. Even if the inspector uncovers only minor issues, sometimes buyers and sellers can let their egos and emotions get in the way over costs and responsibility for repairs. The important thing to remember is to keep it in perspective. Is a squabble over a few hundred dollars really worth risking not getting the home you want or losing a good buyer? Probably not.
We can’t quite shake that snow around Chicago, but March is coming and that makes it feel closer to spring. Spring is also the time when lots of people shake off the winter blahs and start thinking about buying or selling a home. Here is a roundup of a few things to think about for the spring market:
You may or may not agree with this realtor that red accent walls are officially over, but it is a reminder that any personal touches–whether it’s funky colors, kitschy decor, or family photos–can have an affect on how potential buyers view your home when it’s on the market. You can decorate your home however you like, but when it comes time to sell you want to neutralize any unique decorations so they can picture themselves, and their own quirky tastes, living there too.
In a tight market with twice the inventory of homes for sale as usual, lowering the price is often the best way to sell. After a brief bump from the home buyer tax credits this spring, economists say home prices are likely to fall further, and sellers are in a difficult place trying to set the right price. This article from the Washington Post discusses how to find the sweet spot:
Analyze your market first. Determine how many houses similar to yours are up for sale. Consider neighborhood, school district, size and price point. The more homes there are, the more it becomes necessary to list at the lower end of the prevailing price range.
This article from the Milwaukee Journal Sentinel talks about the importance of home inspections for both sellers and home buyers:
[A] professional home inspector will be able to point out issues that might go unnoticed by someone who doesn’t know the ins and outs of inspecting. Today’s buyers are quick to point out flaws uncovered by the home inspectors they bring with them, particularly if the flaws could compromise health or safety. Buyers can use problems as bargaining chips, causing previously agreed upon prices to be lowered or even the cancellation of a deal. Inspections help uncover imperfections that often can be fixed easily and inexpensively, so it’s worth it to get your home inspected before you list it.
In Chicago at least, standard practice is for the buyer to hire an inspector once they have already signed a contract to buy a home. At that point though, an inspection can turn up issues that sellers may not have known about, and could have fixed for much less money and fewer headaches. It may be worth it to hire an inspector and resolve any issues before you even list your home.
How not to sell your house — chicagotribune.com
The Tribune’s Mary Umberger offers a list of gotchas that can prevent you from selling your home, or when you do, getting the highest price possible. Beyond making sure the home is in good shape and free of clutter, sellers often don’t think about other factors, like their reaction to offers and personalization of the home, that can impact a successful sale.
Realty Times – In a Down Market, Pricing Needs to Get Out Ahead of the Curve
The hardest part about a declining or stagnant market is deciding where to set your asking price. In an “up” market, this was easy: you could look at recent sales of similar homes and set your price a little higher. But when things are moving in the opposite direction, how do you know where to start?
In the book Shift: How Top Real Estate Agents Tackle Tough Times, author Gary Keller says the same logic applies. Sellers in a down market have to get ahead of declining values and set their asking prices where they will attract offers, and this often means lower than recent comparable sales. As Bob Hunt says in his review of the book for Realty Times, “If you fail to get ahead of the market when the market is in decline, the consequence is not that you simply receive a lower price; the consequence is that you don’t get a sale at all.”
10 New Year’s Resolutions for Home Sellers
Homescape’s Duane Hopper offers up a real estate version of the perennial list of resolutions, this time for home sellers in a tough market. All ten are good ideas, but our two favorites are:
Wacko world of willfully weak market — chicagotribune.com
Are homeowners still in denial about falling home values, or have they learned to be realistic? It depends who you ask, naturally. Mary Umberger tells us that Zillow.com thinks homeowners are in denial, not surprising for a company whose business model is based on the presumption that it knows how much your home is worth better than you. On the other side, a study by Reuters and the University of Michigan finds that just less than half of homeowners–twice as many as last year–think that their home has declined in value.
We’ve found that the degree to which sellers are flexible about asking prices depends on their urgency. Those who are just testing the waters, or haven’t even started shopping for a new home yet, are more willing to stick to their dream price. Those whose home has been on the market for a long time, have already purchased a new home contingent upon the sale of their current one, or need to relocate, are more flexible.
We hate to use the term “realistic” about describing how someone determines an asking price, because that implies that holding out for a certain price is always bad, even if time and urgency allow. Some sellers can afford the risk of longer market times in turn for getting a higher asking price. But others need to sell within a certain time period, and those people need to be the most flexible and willing to adjust their expectations according to their circumstances.
Even in this climate, there’s no rule like an old rule — — chicagotribune.com
This week’s Tribune has a useful article about how longstanding “rules” of real estate still apply, even in today’s changing market. Buyers and sellers can count on certain maxims to get the best deal, regardless of the financial environment, including:
Best Home Staging Tips – Homescape
Making your home look its best for potential buyers is somewhat of an art form, subject to personal tastes and the home’s characteristics. But there are a few common sense tricks for sprucing up a lived in space that apply across the board. The Homescape blog offers 10 tips for staging, including:
Sale ain’t over till it’s closed — chicagotribune.com
You already knew that technically, your house wasn’t sold until you left the closing table and handed over the keys. But if you did sell your home in the past few years, you probably closed the deal mentally as soon as the buyer signed the contract.
Not so these days, as this article in the Tribune points out. The credit crisis means that buyers can have their formal mortgage application turned down at the last minute, even if they had already been pre-approved for that amount. Risks for the lender can shift based on the borrower’s income, credit, and the property’s location, and now that lenders are meticulously analyzing every mortgage, any one of those could unexpectedly derail a deal. Potential buyers would be wise to check with their mortgage broker or bank frequently throughout the purchasing process, and take action to shore up any weaknesses in their resume, like putting down a larger down payment.
It’s still buyer vs. seller — chicagotribune.com
The Trib’s feature real estate story this week points out something that’s painfully obvious to those of you trying to sell your homes right now: the buyers are in control, and not just by having a large selection. Buyers know that some sellers are desperate to move, and are demanding everything from simple inspection item repairs to furniture and new appliances with their offers.
Of course, this can get out of hand, and the example in the article of one buyer demanding that a flat screen TV and surround sound system be thrown in with the home is extreme. But as a seller, you can avoid some irritating requests by taking care of all those nagging repairs you’ve been living with at home–the bathroom door that doesn’t quite shut, the bathtub that needs more caulking, the furnace that runs a little hot, or the water heater that runs a little cold. These can be surprisingly simple to fix up front, but can become a major point of contention during a heated negotiation process.
Getting your home in top shape to sell doesn’t necessarily have to involve expensive renovation projects. As this article in the Tribune shows you, inexpensive fix-ups and staging can make a major difference in your home’s appearance. For example, a fresh coat of paint throughout (done by yourself, to save money, of course) can dramatically affect the home’s feel, as can simple decluttering and top-to-bottom cleaning.
The slowing market means many sellers are getting nervous, but an article in the Tribune points out that you can’t let that anxiety impact yours and your agent’s ability to sell the home. Try to keep perspective about the process; don’t pressure the sales agent, don’t count on open houses or blanket marketing to solve your problems, and remain realistic about the asking price. It is a tougher market, so you have to do everything you can to maximize the home’s selling potential.
