The first thing you should know as a prospective home seller is, it’s still a great market! That’s right, for over 2 years now, sellers have been uniquely positioned to get the best possible value for the sale of their homes. We even saw sellers receive offers well above the asking price on occasion. It’s Economics 101: when you have more buyers than a product, the price will often rise.
There are a number of reasons why sellers are still enjoying a great market. First, let’s talk a little more about the concept of inventory. During the pandemic, people everywhere began reassessing their priorities. Many decided to downsize, move out of town, or even across the country for a variety of reasons. In essence, everyone was in the market for a home at the same time. Mid-priced homes, particularly, entered and left the market in record time. Current inventory is actually up from last year but it’s still less inventory than the industry was accustomed to pre-2020.
Next, there’s this business with interest rates. Interest rates are certainly up by contemporary standards. However, let’s put things in perspective. At the turn of the century, the average interest rate was over 8%. Twenty years before that, it was closer to 18%. So, while rates are higher than say 5 years ago, they’re still pretty low from a historical standpoint.
Right now, as a seller, you are holding the key to the most important tangible asset out there. No, not your vintage Beanie Baby collection, your home! For the time being, multiple offer situations look to be the norm. Lots of buyers want what you have and they’re willing to offer a fair price to get it. If only that were the case with Beanie Babies. What am I supposed to do with all these things?
Don’t think it’s all a done deal though. As a seller, focus on maximizing the curb appeal of your home to increase interest and value, especially considering a more “normal” looking housing market could be on the way sooner than later. Or, if there’s one thing we’ve learned over the last few years, a new version of normal. So, make those repairs, add that new coat of paint, and keep standing out from the competition!
Whether you currently own a home or are thinking of purchasing one, you may be looking for ways to build equity. Home equity is the overall difference between the amount you owe on your mortgage loan and your home’s market value. Home equity can be used to take out a loan, invest, build long-term wealth, or sell your home for more than you owe and keep the profit.
The equity you have access to will increase as you make payments that pay off your mortgage balance. It can also grow when your home’s value increases. The following details five of the quickest ways to build home equity.
1. Make a Larger Down Payment The simplest and quickest way to build equity in a home is to make a large down payment when you first buy the property. The down payment you make is immediate equity. Let’s say that you’re buying a home for $200,000. With a $10,000 down payment, you’ll owe $190,000 on the mortgage and have $10,000 in equity.
If you can afford it, you could instead choose to make a down payment of $40,000, which means that you would owe $160,000 on the mortgage and have $40,000 in equity when you first move in. Keep in mind that a 20% down payment will also remove the private mortgage insurance requirements for conventional loans, which is an added benefit.
2. Make Mortgage Payments More Often Only a percentage of the mortgage payment you make each month is put towards the principal of your house. The remainder of the payment goes towards interest and taxes. When you make additional payments or provide a payment that’s higher than the minimum amount, you are putting more money toward the principal and increasing your equity.
3. Consider a 15-year Mortgage If you take out a 15-year mortgage as opposed to a 30-year one, your monthly mortgage payments will be significantly larger. When you take this approach, you’ll be paying off more of the principal each month, which will help you build equity quickly. You’ll also pay less interest over the course of the loan.
If you’ve already purchased your home, you could decide to refinance the mortgage loan, which would allow you to switch from a 30-year loan to a 15-year option and build equity faster. Make sure that you can afford the higher monthly payments before choosing this solution, and make sure you take current interest rates into account as well.
4. Invest in Home Improvement and Remodeling Projects You can also build equity in your home by investing in home improvement and remodeling projects that will increase the home’s value. The most popular renovations include kitchen and bathroom remodels. Make sure that you select projects that will get you the best return on investment (ROI). Reach out if you want to discuss projects with the highest ROI in our area.
5. Use Gifts and Windfalls Consider building equity by using any gifts or windfalls you receive to pay down the balance of the loan. Do you receive birthday or holiday gift cards? If so, these can be converted to cash and added to your mortgage payment. The same is true of any inheritance you receive.
Building home equity gives you financial security and allows you to prepare for your future. By making a large down payment, paying more money each month, and improving the quality of your home, you can build equity relatively quickly.
Even though activity in the housing market has slowed from the frenzy we saw over a year ago, today’s low supply of homes for sale is still a seller’s market. But what does that really mean? And why are conditions today so good if you want to list your house?
It starts with the number of homes available for sale. The latest Existing Home Sales Report from the National Association of Realtors (NAR) shows housing supply is still astonishingly low. Today, we have a 2.6-month supply of homes at the current sales pace. Historically, a 6-month supply is necessary for a ‘normal’ or ‘neutral’ market in which there are enough homes available for active buyers.
What Does This Mean for You? When the supply of homes for sale is as low as it is right now, it’s much harder for buyers to find one to purchase. That creates increased competition among purchasers and keeps upward pressure on prices. And if a buyer knows they’re not the only one interested in a home, they’re going to do their best to submit a very attractive offer. As this happens, sellers are positioned to negotiate deals that meet their ideal terms.
Economists at NAR say: “Inventory levels are still at historic lows. Consequently, multiple offers are returning on a good number of properties.”
Right now, there are still buyers who are ready, willing, and able to purchase a home. If you list your house right now in good condition and at the right price, it could get a lot of attention from competitive buyers.
Bottom Line Today’s seller’s market holds great opportunities for homeowners ready to make a move. Listing your house now will maximize your exposure to serious, competitive buyers. Let’s connect to discuss how to jumpstart the selling process.
Selling a property on your own, also known as “For Sale By Owner” (FSBO), can be an appealing option for homeowners looking to save money on real estate agent commissions. However, it’s important to understand the costs involved in selling on your own, as they can add up and potentially outweigh the savings.
Marketing and Advertising: When selling on your own, you’ll need to invest in marketing and advertising your property. This can include professional photography, virtual tours, online listings, signage, brochures, and more. These costs can vary depending on the level of exposure you want for your property.
Time and Effort: Selling a property requires a significant amount of time and effort. As a FSBO seller, you’ll need to handle all aspects of the selling process, including scheduling and conducting showings, negotiating offers, managing paperwork, and coordinating with potential buyers. Consider the value of your time and whether it’s worth the savings to handle these tasks yourself.
Legal and Documentation: Selling a property involves various legal and documentation requirements. You may need to hire an attorney to review contracts, ensure compliance with local regulations, and handle any legal issues that may arise. These costs can vary depending on your location and specific needs.
Lack of Market Knowledge: Real estate agents have extensive knowledge of the local market, pricing trends, and comparable sales. Without this expertise, you may have difficulty setting the right listing price for your property, potentially leading to a longer time on the market or selling for less than its true value.
Negotiation Skills: Negotiating with buyers can be a challenging aspect of selling a property. Real estate agents are experienced negotiators who can help you get the best possible price and terms. Without this expertise, you may find it difficult to navigate negotiations effectively.
Limited Exposure: One of the main advantages of working with a real estate agent is the exposure they can provide through their network, online platforms, and marketing efforts. As a FSBO seller, you may have limited access to potential buyers, resulting in reduced demand and potentially a longer selling process.
It’s crucial to carefully consider these costs and potential challenges before deciding to sell on your own. While it’s possible to save on agent commissions, selling a property without professional assistance may not always be the most cost-effective or efficient option.
Today’s housing market is full of unprecedented opportunities. High buyer demand paired with record-low housing inventory is creating the ultimate sellers’ market, which means it’s a fantastic time to sell your house. However, that doesn’t mean sellers are guaranteed success no matter what. There are still some key things to know so you can avoid costly mistakes and win big when you make a move.
1. PRICE YOUR HOUSE RIGHT
When inventory is low, like it is in the current market, it’s common to think buyers will pay whatever we ask when setting a listing price. Believe it or not, that’s not always true. Even in a sellers’ market, listing your house for the right price will maximize the number of buyers who see your house. This creates the best environment for bidding wars, which in turn are more likely to increase the final sale price. Mary and Scott, real estate professionals are the best people to help you set the best price for your house so you can achieve your financial goals.
2. KEEP YOUR EMOTIONS IN CHECK
Today, homeowners are living in their houses for a longer period of time. Since 1985, the average time a homeowner owned their home, or their tenure, has increased from 5 to 10 years. This is several years longer than what used to be the historical norm. The side effect, however, is when you stay in one place for so long, you may get even more emotionally attached to your space. If it’s the first home you purchased or the house where your children grew up, it very likely means something extra special to you. Every room has memories, and it’s hard to detach from that sentimental value.
For some homeowners, that connection makes it even harder to separate the emotional value of the house from the fair market price. That’s why you need Scott and Mary, real estate professionals to help you with the negotiations along the way.
3. STAGE YOUR HOUSE PROPERLY
We’re generally quite proud of our décor and how we’ve customized our houses to make them our own unique homes. However, not all buyers will feel the same way about your design and personal touches. That’s why it’s so important to make sure you stage your house with the buyer in mind.
Buyers want to envision themselves in the space so it truly feels like it could be their own. They need to see themselves inside with their furniture and keepsakes – not your pictures and decorations. Stage, clean, and declutter so they can visualize their own dreams as they walk through each room. Mary and Scott, real estate professionals can help you with tips to get your home ready to stage and sell.
The housing market forecast for the second part of this year remains positive, but there may not be a better time to sell than now. If you’re wondering what to consider when deciding if now is the time, here are some things to think about:
1. Your House Is Probably Going To Sell Quickly
Homes from the beginning of the year through this summer are selling fast according to the National Association of Realtors. With an average of just 17 days on the market, this indicates buyer competition. Homes going fast is a great sign for sellers. This is a major indicator that buyers are motivated to do (and pay) what it takes to purchase the home of their dreams.
2. Buyers Are Competing For Homes
In addition to selling fast, homes are receiving multiple offers. NAR reports sellers are seeing an average of 5 offers, and these offers are competitive ones. Shawn Telford, Chief Appraiser at CoreLogic, said in a recent interview: “The frequency of buyers being willing to pay more than the market data supports is increasing.” This confirms buyers are ready and willing to enter bidding wars for your home. Receiving several offers on your house means you can select the one that makes the most sense for your situation and financial well-being.
3. Low Supply, High Demand
One of the most significant challenges for motivated buyers is the current inventory of homes for sale, which while improving, remains at near-record lows. Total housing inventory at the end of May was down 20.6% from one year ago. There are signs, however, that more homes are coming to market. If you’re looking to take advantage of buyer demand and get the most attention for your house, selling now before more listings come to the market might be your best option.
4. If You’re Thinking of Moving Up, Now May Be the Time
Over the past 12 months, homeowners have gained a significant amount of wealth through growing equity. In that same period, homeowners have also spent a considerable amount of time in their homes, and many have decided their house doesn’t meet their needs. If you’re not happy with your current home, you can leverage that equity to power your move now. Your equity, plus current low mortgage rates, can help you maximize your purchasing power.
But these near-historic low rates won’t last forever. Experts forecast interest rates will increase in the coming months. As interest rates rise, even modestly, it could influence buyer demand and your purchasing power. If you’ve been waiting for the best time to sell to fuel your move up, you likely won’t find more favorable conditions than those we’re seeing today.
If you’re a homeowner, you already know that keeping your property in tiptop shape requires dedication and patience for ongoing maintenance. But what if you’re putting your home on the market or even accepted an offer? Perhaps you’re thinking: Not my problem anymore. However, just because you’re selling doesn’t mean you’re off the hook from routine maintenance tasks—and that’s especially true if you’ve already vacated the house. Sure, a well-cared-for house shows better: Small things like broken doorbells and leaky faucets make buyers wonder if your property also has bigger issues elsewhere. But more importantly, a little routine maintenance can help you avoid a catastrophic problem down the line (e.g., burst pipes, roof leaks, critters moving into your attic) that could devalue your property and derail that sale. To prevent minor issues from escalating into full-blown, money-sucking, sale-killing problems, focus on these six important areas you can’t afford to neglect.
Keep up the yard and walkways
Whether you’re still living in the house or not, you’ll want to make sure to keep your landscaping tidy—remove dead tree limbs, rake leaves, and clean out flower beds. Curb appeal is so important. If your home is already vacant, have someone tend to the yard regularly so that grass and weeds don’t detract from your home’s appearance. If your home does not have a well-maintained exterior, potential buyers will keep driving. Plus, this kind of neglect can be a bull’s-eye for vandals to break into your property. Consider having lights on timers so the house doesn’t look dark all the time, and arrange for driveways and walkways to be plowed weekly in the winter months. And don’t let mail pile up in the mailbox.
Clean the gutters and check the roof
This one’s easy to forget about, even when you don’t plan on going anywhere. But when it comes to gutter and roof issues, neglect can cause a dangerous domino effect. Overflowing gutters can damage your foundation, and also lead to drainage issues. And, of course, you don’t want buyers seeing puddling water as they approach your house. And then there’s the roof. Of course, it’ll be examined during the home inspection, but it would benefit you to do it before putting your home on the market. Small roof cracks can remain undetected for years, causing water to slowly infiltrate your home and damage ceilings and walls.
Service your heating systems
The hidden guts of your home need regular attention, whether you’re still living there or not. That means having your HVAC systems professionally serviced. First up, your furnace: If you get it addressed before you list your home, it won’t smell like dust when you crank up the heat during an open house on a chilly day. While you’re at it, have the duct work and filters cleaned as well. And if you have baseboard heaters, vacuum those out, too.
Speaking of heat, it is suggested to keep the thermostat at 66 degrees Fahrenheit when agents are showing your house so buyers can visit your place comfortably. This will also avoid any issues with pipes freezing or bursting in the colder months.
Have a chimney? Be sure to have it inspected and cleaned as well. You want to make sure there are no cracked flue tiles, and that from the exterior, there are no gaps in the mortar between the bricks. Otherwise, you could potentially have the chimney fall over onto the house, and that’s a very expensive fix.
Keep the critters out
If you don’t want to add “family of raccoons included” to your listing (and pay the hefty tab for getting them out), inspect the inside and outside of your home for any areas that need to be plugged up. Take care of holes from damaged siding or fascia under the roofline—and do it promptly. In a colder climate, squirrels look for somewhere warm to go, and they’ll find their way into your property. Stove and dryer vents, for example, should be covered with wire mesh to deter pests.
Wash your windows
Most people associate sparkling windows with spring cleaning, But if your house is on the market, it doesn’t matter what time of year it is—you need to get those babies squeaky clean. If buyers walk through your home and all they see are dirty windows, that’ll really mar the showing process. Make sure to wipe them down after a bad storm, when they’re especially likely to show muck and grime buildup.
Check the calendar
Depending on what time of year you bring your house to market, pay attention to any details that scream, “We don’t live here or care anymore.” That means tackling seasonal tasks such as clearing away lawnmowers in the fall and storing shovels in the spring. It is also a good habit to put away patio furniture in the fall and winter. Leaving them out all year long shows deferred maintenance and lack of caring, and can really turn off a potential buyer. Staying on top of these regular tasks will make it easier to sell your home with fewer headaches. Plus, it’ll preserve the value of your property, and potentially, the thickness of your wallet, too.
What is a home inspection? A home inspection is an examination of the condition and safety of a piece of real estate, often conducted when the home is being sold. A qualified home inspector will assess the heating and cooling system, water and sewage systems, other plumbing, and electrical work, and look for any potential fire or safety hazards.
Inspections and Repairs are Popular Again During the housing market frenzy of the pandemic, many buyers waived inspections to be more competitive with their offers. However, a recent Realtor.com survey found that inspections and repairs are becoming popular again:
95% of buyers are requesting home inspections.
95% of sellers are making some updates or repairs prior to listing.
67% of buyers are asking for repairs as a result of the home inspection.
$14,163 is the average amount sellers spend on updates/repairs prior to listing.
The inspection of a major part of the home selling process. Let’s connect so you have an expert on your side who can help you determine the repairs and updates your house needs before you sell.
After all of the preparation required to list your home, you are probably ready to relax and wait for offers. While most of the hard work is done, it is important to keep in mind things that you may run into during the sale process. As you begin to welcome potential buyers into your home, here are a few things to expect now that your home is listed!
1. You might feel like you live in a museum.
You may have spent a great deal of time cleaning and decluttering, but now you are going to need to maintain that cleanliness. Potential buyers are going to expect a home that was as neat as the listing photos they saw, so it is important to meet their expectations. Now that you have officially listed your home, maintenance is necessary. There may be showings where you don’t have time to do a full deep-clean, so choosing to keep your home ‘show-ready’ will help reduce any stress about the appearance of your home for a showing.
2. There will be some inconveniences.
Now that you have realized your home needs to be ‘show-ready’ at all times, you might be starting to think that there could be an inconvenience or two during this part of home-selling. While your real estate agent will be helpful in this process, you may need to switch around plans during the evenings or weekends when you are typically home so that your home can be shown.
3. Expect to hear critiques and criticism.
This is often the main thing that first-time home sellers struggle with. It is not always easy to hear the issues a potential buyer may have with the home you have created. While some criticism can feel insulting, it is important to remember that it is not personal. Potential buyers are not trying to hurt your feelings, they just want to picture your home as their own. Your agent can be a key part in buffering criticism. They will be able to take suggestions from potential buyers and relay it to you in a way that is helpful and constructive.
4. Home maintenance will be crucial.
While maintaining home cleanliness is important, you will also need to keep up with maintenance tasks. Your lawn will need to be mowed, your heating and cooling systems need to be operating properly, as well as any appliances that will be staying when your home sells.
5. There can be some additional expenses.
After you’ve accepted an offer, the closing process will begin. There will be inspections and final walk-throughs, and this can bring about issues that may need resolved before the sale is closed. Depending on the issue, you may need to pay out-of-pocket for repairs so that you don’t need to negotiate your sale price.
If you’re ready to sell your home and need someone by your side to guide you as you prepare to list, give me a call today!
You probably know that home inspections are often part of the homebuying process. But do you know why they’re so important — or what they mean for your home purchase or sale? Home inspections can play a big role in whether your homebuying (or selling) efforts are successful. Are you hoping to buy or sell a house soon? Here’s what you should know about how a home inspection might impact your goals.
Inspections are not required. A home inspection is generally encouraged for buyers, but it’s not required. In a hot market, buyers might waive their right to an inspection to win a bidding war. But be careful: This could hurt you financially if you find yourself having to make large repairs and renovations.
The results can influence your deal — and your price. If the inspector finds issues, the buyer will often want to renegotiate. They might ask the seller to make repairs before closing or offer a lower price point to account for them. If they have an inspection contingency, a buyer can even pull out of the deal without losing earnest money.
You have to pay for an inspection. Home inspection costs vary by market and inspector, but they typically cost between $250 and $500 per property. Since the inspection is for the buyer’s benefit, they cover this cost out of pocket, usually as part of the closing costs.
Sellers sometimes get pre-listing inspections. By getting one before the home hits the market, sellers can identify any problems that could hold back their sale. In many cases, sellers are required to disclose any issues their inspector finds if they haven’t been fixed.
If you’re preparing to buy or sell a home, get in touch today to start working with an experienced real estate professional.
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