Is it still a good time to sell Real Estate?
Depending on your needs, it can still be a good time to sell your property. If it’s a lower-priced property, it ought to sell quickly. If it doesn’t, you need to be prepared to drop the price a little as it may be priced higher than the competition. Commission rates are beginning to go back up now that there are more homes on the market. Lower priced houses that need some TLC (which may range from carpet and paint to more serious work) and fixers are offering 3% and even 4% to outside brokers to get them to bring more potential buyers through the door.
Be ready to list your property for six months if it’s priced over $300,000 in the
Inland Empire
, and particularly if it’s above $400,000. Mid-range homes are taking longer to sell these days, and luxury and estate homes always require time to sell. There are fewer qualified buyers for such properties, and specialized marketing may be needed to attract their attention. Also, remember that given the choice between an older home and a new one in similar locations, many buyers tend to choose the latter, so you shouldn’t assume that your home is instantly attractive to everyone.
No matter the level at which you are selling, try to look at your home through a potential buyer’s eyes. If you can, take the time to visit different houses in the same price range and see what the competition is like. Which one would you buy?
What do I need to do if I’m thinking of putting my home on the market?
First of all, feel free to contact me by phone at (951) 640-1458 and/or e-mail (dizonaj@gmail.com) and tell me about your situation. Give me as much information as possible, and I will prepare a Comparitive Market Analysis for you. This report is usually over 20 pages long and consists of data about recent sales, listings, and expired listings for similar properties surrounding the subject property. I include graphs and color digital photos, and I visit the properties that are currently for sale in order to inform you of area market trends. I will then go over the report with you and explain details that might get overlooked, such as how one house that is remarkably like yours but didn’t sell is located directly across the street from a construction site or that another one sold in only 2 days but that it had expired previously at a higher price.
In addition, I can also prepare an estimate of seller’s proceeds for you that will show how much the sale of your home may bring you, taking into account the cost of selling it and any mortgages you may have on it. This estimate can help you think ahead for buying another home and/or settling financial matters.
How will
Alma
market your property?
I will market your home individually, taking into account its strengths and weaknesses as well as the community where it is located. First and foremost, your digitally photographed property will appear in the Multiple Listing Service with a compensation that will insure it gets noticed by other agents, so that more buyers will visit it and make offers. From the MLS, your property will automatically go into other websites that buyers frequent these days even before contacting an agent. I will prominently feature your property on my websites (see, e.g. my Featured Homes for Sale in Riverside and San Bernardino), my current homepage listings, and seperate pages for featured listings (e.g. 3139 Belvedere). Your property will be advertised in local newspapers and, if fitting, in coastal papers. Since buyers often look for a home near friends and relatives, I will advertise in your neighborhood through postcards and flyers in addition to invitations to open house showings.
Individual attention can make all the difference in selling your property in a timely manner and to someone who will care about it enough to make a good offer. I will study your property and neighborhood to come up with a plan for getting the attention that your home needs to sell well.
What can I do to make my home more attractive to buyers?
During the sellers’ market, I was amazed at how many poorly shown homes I visited, and even now, with fewer buyers in comparison to sellers, I see places that could benefit from the basics. Here are a few suggestions:
1. Make sure your home sparkles, including toilets and faucets. Look up and remove cobwebs. Dust the exterior of your house, especially the entrance and any patios. Have the windows, carpets, spa, and pool cleaned.
2. Open curtains and blinds to let the light in. Turn on all the lights.
3. If it’s hot, as it often is in the
Inland Empire
, don’t skimp on the air conditioning.
4. While curb appeal doesn’t factor into the appraisal, it can mean multiple (and thus higher) offers on a home, so water the lawn and reseed it in advance if necessary. Easy, fast-growing annuals can give your property some color and make it stand out, but be sure to get advice at the nursery if you don’t have a green thumb and don’t forget to water them daily, if necessary, once the heat dies down.
5. Get rid of extra clutter. Have a garage sale, give stuff away, and store it somewhere else. Remember, don’t have your closets overflowing or else buyers will think there isn’t enough storage space.
6. Make repairs (the kind you put off when you weren’t going to sell) before you put the property on the market and not while buyers are watching.
7. Make it as easy and unembarrasing as possible for buyers to see your home. Have a lockbox, so that buyers can see the home when they have time to look. If you must make appointments, keep them, and make sure that everyone is out of bed in time. (This can be hard with teenagers, but it can be done!) Have your pets well secured, so that they won’t escape, and give lots of warning about their presence and personalities if they’re difficult.
What if my home doesn’t sell?
A home should eventually sell and for a profit, but the ultimate factor is your motivation. If you have some time and are truly motivated to sell, you will take the necessary steps to meet your buyer halfway. You may decide that you can stay where you are and take your house off the market until a better time. The main thing is to examine your needs and priorities.
If you must sell, then consider lowering the price. Visit other properties for sale in similar and lower price ranges and see how yours compares. By bringing the price down to below an easily searched number, such as from $304,000 to $299,900, your property may suddenly start showing up on more searches and will attract more attention. Also, it is amazing how much less buyers will quibble over minor imperfections if the property has a lower price on it.
If you can afford to, make repairs, paint, and update, not for the buyers who came through last week but for the ones who will start looking when you’re done. When prices began to get really high in some
Riverside
neighborhoods, I saw some homes go on the market before they were ready with sellers making repairs and improvements along the way. The problem was that potential buyers saw the work-in-progress with a finished price tag on it. By the time the work was done, these buyers had moved on.
If you can’t repair or replace items, then think about offering an allowance for carpet and paint. However, remember that this allowance won’t help potential buyers who don’t have much imagination.
If you can, find out how much competing sellers are offering to outside brokers and raise the compensation on your home accordingly. If the going rate in your neighborhood has gone up, and you’re still offering only 2% or less, other agents are probably taking their buyers elsewhere, and your home isn’t even showing up on itineraries. On the list of expired listings that come up every day, I see homes priced well over $400,000 that only offered, say, $4000 to the outside broker. I doubt that many buyers saw these properties.
Also, think about how your home is being marketed and to whom. If you have an unusual property that won’t appeal to people who want a tract home, word has to get out to the sort of person who will fall in love with it.
Home sweet home …
Many of us dream of finding a permanent home—one where our hearts belong and where we will live out the rest of our lives. At the same time, there is a strong desire for improvement that runs deep in our culture. We often want to better ourselves and our surroundings, hence the proliferation of diets and home improvement shows. At some point, however, a lot of people run out of reasonable options for reshaping their homes. Perhaps a roomier kitchen is needed or more storage space. Also, neighborhoods change, and a once idyllic home may now sit closer to crowded thoroughfares than one would like. The truth is, we all change, and then we find that our needs have, too, and the house we live in no longer reflects who we have become.
If you are not prepared to tear your house apart and rebuild it while either living in a corner of it or renting another place, it may be time to put it on the market and find another home. This is, of course, a daunting and time-consuming task, made manageable only by large quantities of time and money. But people without much of either do it frequently, and they achieve it by learning about the process, finding an agent whom they trust, and staying focused until escrow closes and they have moved into their new home at last.
Sellers are also buyers
We’ve been in a sellers’ market until recently, but this situation doesn’t mean that sellers have been having a completely easy time. Most sellers are also buyers in that they need to buy another home to move into once they sell their current home. Unless they are moving to a more affordable area, odds are the house they want is larger, newer, and has a better location than the one they have now, so they will probably have to take on more debt. When they make an offer to buy the other house, they have to say that the offer is contingent upon them selling the first. Their offer is then less attractive that one that doesn’t have any contingencies. After all, the house that they’re selling may fall out of escrow, thus depriving them of the funds to buy the second one.
Some sellers are opting out of the stress of concurrent escrows by renting after they sell their home and only looking for a new one after closing escrow. They can make an offer with a large cash component and have no contingencies. On the other hand, they are running the risk that the market will continue to rise and take away from their buying power. This option may make more sense for people who are downsizing or who are moving to a less expensive area. For those who are moving to higher-priced area, this choice makes less sense unless the costs involved, such as rent along with double moving costs and storage, are much lower than their mortgage payments would be.
How do I price my home?
Your home reflects you: your interests and priorities, your tastes, and your personality. It can be hard to put a price tag on it because it would be like putting a price tag on your sense of identity. You’re understandably proud of your property and want to receive top dollar for the years of upkeep. You see how much the house (a smaller one with a yard full of weeds) down the street listed for, and you’re sure that your house is worth much more.
First off, ask me for a comparative market analysis (CMA). I’ll pull up info showing how much similar properties in your area have sold for recently in addition to the listing prices of ones in escrow and those still on the market. I’ll present you with a written report, complete with photos, and graphs. We’ll discuss how long different houses took to sell, and I’ll show you listings that expired without selling. You’ll then have a clearer idea of what’s going on in the real estate market around you. You might even find out that your neighbors’ house didn’t sell for as much as they boasted….
After going over the CMA with you, discussing the data, and letting you show me your property, I will discuss price ranges with you. Depending on how much if any work that your home may need, you might want to consider low, medium, and high ranges. In general, unless the property is a more luxurious one and thus likely to take time to sell, it’s better not to price your house too high because the longer it stays on the market, the less interest there will be in it. Then there’s the danger that if you gradually chip away at the price, people might be curious to see just how low you are willing to go. In the current sellers’ market, an attractively priced house will bring in multiple offers, allowing the sellers to pick the offer that most appeals to them. Such houses sometimes end up selling for more than their high range prices.
In addition, if you have time (and you like to see houses), you may also want to go to some open houses around you to see what the competition looks like. You may discover that your house is much nicer or you might find that the competition is tough. Take note of how long other houses have been on the market as it will help you understand if there is a ceiling on prices. See what mistakes other sellers are making and learn from what they’re doing well. While appraisals depend ultimately on measurable factors, such as size and condition, curb appeal and décor can attract interest from more buyers, thus contributing to competitive bidding.
Why shouldn’t I just take the highest offer?
When the offers start to come in, I will go over them with you and point out their advantages and disadvantages. If there are a large number of offers, I’ll help you organize them into different groups, so that you can take more time with the better ones. If it’s feasible, I like to have the buyers’ agents present their offers in person as they know their buyers well. Afterward, we’ll discuss possible counters to try to make the best deal for you. The human aspect can also add a whole other dimension to the transaction. For instance, you may find that the higher offer is coming from someone who wants to turn your children’s first home into a rental while a lower one is from a young couple that wants to start a family. The money might make the former palatable to you, but then it might not.
You may find that the highest offer isn’t always the best one. For instance, you might want to look further down the page and see how much of an earnest deposit they’re attaching to their offer. Is it a significant amount or is it one that the buyers can walk away from? Are they bringing much of a deposit to the offer or will they need to borrow a substantial sum? Do they have 100% financing and if so, do they have funds to close or will they need your help? Note that if they don’t have much cash, the house will have to appraise at the offered amount. If it doesn’t, their loan won’t come through, and you’ll find yourself renegotiating with them during escrow. You may have to meet them partway or even let them drop the price all the way down to the level at which the house appraised. The buyers can request another appraisal, but that one may also not come in high enough. Now, you’ll have to ask yourself if you have enough time to put the house back on the market. I prefer to avoid this situation from the start with careful countering and reading the fine print of the offer.
Can I get enough from the sale of my house to buy one I like?
Before you decide to sell your home, you should talk to a mortgage broker and get the whole story. It’s not enough to get a few round sums. Break down your current monthly payments and give your lender as much information as possible. Your loan agent can then tell you just how much house you can afford taking into consideration how much you expect to earn from the sale of your current home. A good loan agent may find strategies you haven’t considered in order to make the payments manageable on the house you want. I’m not a loan agent and won’t pretend to know all the possible programs and angles for your situation, but if you don’t already have an agent, I can recommend ones that I have worked with.
At what stage can I discuss my plans with you?
You can contact me at any stage. If you’re just beginning to look at the market, let me know, and I’ll set up a comparative market analysis for you to give you an idea of how much your house can sell for at this time. I can even update it for you as time goes on, so that you can see if your house is going up in value or if the market is levelling off. If you wish, I can also make a preliminary search for you in areas where you’re interested in living to help give you an idea of cost and availability there.
It’s very important to me to get to know my clients in order to help them better. I’ll ask you a lot of questions about what you hope to achieve as well as your needs. Together we’ll arrive at a plan of how to market your property and how to sell it on terms that accommodate you as much as possible.
The lowdown on low commissions …
People have asked me why they should agree to pay me a good commission, and I have to say, “Because you and I deserve it!”
When a real estate agent offers to list your home for a low percentage rate or even a flat fee, you ought to ask what the trade-off is. The truth is, a listing in the Multiple Listing Service can offer other agents compensation as low as 1%, $100, or even just $1. In such cases, a home ends up flying beneath the radar of agents who will not even consider listings that offer a compensation of less than 2 or 3%. Fewer potential buyers hear about such homes, and those that do face little competition, resulting in weaker offers and a lower selling price.
Think about it. If a listing agent splits a 6% commission with a buyer’s agent on a $400,000 house, the seller still makes $376,000. Now that same seller could choose to list exclusively at 4%, meaning that only that listing agent’s company can show the home. If the house sells at $380,000, the seller will make $364,800 and end up losing rather than saving money.
There are also other ways in which a low percentage listing can cost the seller. Besides the tension of possibly having the property sit longer on the market, there’s the opposite but also unattractive prospect of having anxious buyers knock on your door because they cannot reach the listing agent immediately at any hour. And then after one look when you were not ready, they will see that your house did not have enough bathrooms or had too many bedrooms—MLS information that could easily have rerouted them from the start.
By paying for individualized service, your property will ultimately bring you a higher price and with less stress. When I take a listing, I agree to do my best to market that home and split the commission evenly with the agent whose buyer makes the offer that you accept. I will listen to and address your needs, keeping you on top of matters, so that you can make well-informed decisions. Don’t you deserve this kind of treatment?
Where does the commission money go?
You need to remember that a 1% commission does not go completely to an individual agent since real estate agents must work for a broker. At Century 21 Lois Lauer Realty, 8% of the commission goes to the company. The remaining amount is split between the agent and the office where he or she works. A 6% commission on a $400,000 house is $24,000, and if the seller and buyer have agents from different companies, each company will receive $12,000. Coldwell Banker Armstrong Realty would take $960. After the split between the office and the agent, the agent may receive as little as $6624 before taxes. Agents, of course, are only paid after escrow closes. If the property does not sell, the agents do not get paid. All research and marketing is provided to the seller without charge, so the payment, when it arrives, must cover these costs. Likewise, the buyer’s agent invests a lot of time, energy, and money (think gas!) into the search for the best and most appropriate properties.
