When homeowners are preparing to put their properties on the market, one aspect is usually foremost in their minds: money. Setting the asking price accurately can mean the difference between getting an offer quickly and having a house languish for months, drawing little interest.
With that in mind, it’s important that potential sellers block out a lot of the noise that often surrounds the intricate art and science of pricing. There are plenty of myths that may cause sellers to lose sleep at night as they attempt to separate fact from fiction.
The following are statements that can stand in the way of a successful sale.
1. ‘If we keep waiting, a better offer will come along!’
When sellers receive an offer from the first showing, they may be skeptical or hesitant to accept it, wondering if other prospective buyers would be inclined to pay more. Thoughts of potential bidding wars could cause sellers to want to wait and see who else falls for their place. But, remember the old adage, “A bird in the hand is worth two in the bush?” There’s no guarantee other would-be buyers are waiting around the corner. If the offer is a fair one, entertain it and count your blessings.
2. ‘Getting an offer right away, means the agent priced it too low!’
When sellers receive an offer early in the process, as excited as they might be, many can’t help but wonder, “Should we have asked for more money? Did our agent price it too cheaply?” While it’s natural to be skeptical (and even a little greedy), receiving an offer on the early end of the spectrum most likely means your home was priced accurately and attractively. If you trust your agent, you know he or she didn’t pick a number out of the sky, but rather based it on extensive market research. So, be glad your sale is moving in the right direction.
3. ‘We should price it so there’s room to negotiate!’
Let’s be honest: Most sellers would love to get top dollar for their homes. But overpricing it with the intention of being willing to accept a lower offer may just leave you empty handed in the long run. Plus, if you have to drop your ask multiple times, buyers may begin to wonder what’s wrong with the place — other than the price, that is.
4. ‘That’s not what my Zestimate says it’s worth!’
Have you ever noticed how homeowners are eager to believe Zestimates or other automated valuation models when that price exceeds their expectations? Yet, when the opposite happens, they assume it’s outdated or erroneous information? The point we’re making is, these numbers can be inaccurate, so again, trust your agent over the Internet. Enough said.
5. ‘We can add all renovation costs to the asking price!’
Sellers may adore the improvements and renovations they’ve made and want to add in those costs to the asking price. But remember, not every change is going to land a huge return on investment. If you’re curious about what you can expect on those fixes, check out Remodeling Magazine‘s annual ‘Cost Versus Value’ report to get an idea of which upgrades yield the biggest bang for your buck. Also, as you’re making changes, bear in mind that the infinity pool you view as an asset may just seem like a huge liability to a buyer.
6. ‘My Realtor® overpriced my house to make a larger commission.’
Agents are paid a percentage of the selling price of the home. However, even if they were to raise the ask by $25,000, in most cases that would yield an additional $1,500 in commission, which would then be divvied up between the broker the agent is working for and the buyer’s agent, leaving your agent with less than $750 more in his or her pocket. It’s hard to imagine an agent would blow a potential quick sale — and take on weeks or months of additional showings and marketing expenses — for a few hundred dollars.
7. ‘Reducing the price is a sign of weakness!’
While no homeowner is eager to drop the listing price, if time is passing and there’s been little interest, it could be time to consider lowering the ask. Remember, time is money. While you’re waiting for someone to meet your price, you’re still paying the mortgage, taxes, utilities, and insurance etc. Plus, sometimes, lowering the price can put your home in front of a group of new buyers, which could generate a lot more interest and, ultimately, get the price back up closer to where it was in the first place.
Most homebuyers in Oakland County Michigan and across the country are not usually open to make a quick home buying decision and view it as a recipe for disaster or a bad decision. In fact Oakland County homebuyers love to look at the many options, different layouts and areas in which to purchase a new home. To make a quick home buying decision many buyers feel pushed into a corner or feel their Realtor is pressuring them to make rash decisions, but in Oakland County Michigan this is not the case at all. Home buyers know that homes are moving faster than ever off the market, to make quick home buying decision is the smart thing to do in Oakland County Michigan.
Quick Home Buying Decision Facts
The fact is, according to a recent analysis the average home took 81 days to sell last year, and is predicted to be even shorter in 2018. Looking at the number of 81 days may not seem quick, but this includes closing which can usually take four to six additional weeks. As we see in our Oakland County Michigan market there are more buyers than available homes on the market causing home buyers to make a quick home buying decision. A recent report from Zillow finds that the average home buyers spends four months searching for a home and makes two offers before being a successful home buyer. What can a home buyer do? First of all expect a process and be prepared to be going against other offers and sometimes multiple offers. Get pre-qualified, know what you want and avoid deal-breakers and know what they are.
The more prepared you are the more likely you will make the best decision, even if it’s a quick home buying decision that you face. The face of the real estate market is always in fluctuation and swings back and forth, but with the still historic mortgage rates and prices’ of home gaining ground at record speed, it is still the best time to become a homeowner. Patience, knowledge, preparedness and a great realtor to guide you through the process can make your home buying experience a pleasant and enlightening one. READ MORE
Please feel free to give me a call as it would be a pleasure to help you through the process of becoming a home owner. Tom Gilliam 248-790-5594
Buying your first home can be one of the most exciting experiences of your life. But it can also be one of the scariest.
Buying real estate is a complicated process. And if you’ve never purchased a home before, the fear of all those unknown variables can make the experience stressful, frustrating, and downright terrifying.
If you’re thinking about purchasing a home but are dealing with the fear that comes along with it, don’t worry! You’re not alone. Most first time home-buyers deal with a certain level of fear as they get ready to buy their first home.
But that fear doesn’t have to hold you back. Here are three of the most common fears of first time home-buyers (and how you can overcome them).
“I can’t afford to buy a first home.”
The number one fear most first time home-buyers struggle with is the fear they can’t afford to buy a home.
But while there are certainly people who aren’t in the financial position to purchase a home, becoming a homeowner isn’t as expensive as you might think — and sometimes all it takes to be able to buy a home is a little budgeting.
If you’re worried about being able to afford a home, it’s time to take a good, hard look at your finances. Make a list of all of your monthly expenses and all of your debt. How much are you spending per month on living expenses? How does that compare to how much you’d be spending per month on living expenses if you were to purchase a home? How much are you saving each month? Are there any opportunities to cut back on spending and pad your savings a little more each month? How much debt do you carry and what’s your plan to pay it down?
Getting a firm understanding of your financial situation will a) give you a better idea of how much you can afford to comfortably spend on a house, and b) help you come up with a plan to get there.
“My credit isn’t perfect. How am I ever going to get a loan as my first home?”
If you have less-than-perfect credit, a major fear you might be dealing with is how you’re going to get a mortgage.
Many first time home-buyers fear that their credit report might hold them back from securing a loan. But while getting a mortgage with not-so-hot credit can be a challenge, it’s certainly not impossible.
First things first: if you’re thinking about purchasing a home, you need to get a copy of your credit report. According to an FTC report, 1 in 5 Americans have a mistake on their credit report — and those mistakes can end up costing you in the long run. The lower your credit score, the higher your interest rates will be, so it’s important to make sure there’s nothing inaccurate on your report that’s dragging down your score.
Once you’ve reviewed your credit report, you’ll want to do everything you can to bring up your score before you apply for a loan, like pay down any high credit card balances, which will bring down your credit utilization and bump your score. You’ll also want to make sure to pay all of your bills (including your rent and utility bills) on time, which will help show lenders that you’re responsible with your debts.
If you do all of these things and still get stuck with a high-interest mortgage, it’s not the end of the world! You can always continue to work on increasing your credit score and refinance in the future.
“I have no idea what I’m doing. How am I supposed to successfully buy my first home?”
As mentioned, buying a home is a complicated process. From getting to know the market to finding the right kinds of properties to negotiating with sellers, there’s a lot to handle. And if you’ve never purchased a home, it can feel overwhelming. The sense of “I have no idea what I’m doing!” can be pretty terrifying.
But luckily, you don’t have to know what you’re doing when it comes to buying a home… as long as you work with someone who does. Working with a real estate agent who understands your market is an invaluable resource, especially to first time home-buyers. Your real estate agent can not only walk you through the entire process, but they also handle the hard stuff — like finding that perfect property and negotiating with tough sellers — so you don’t have to.
You might be afraid that the fact you’ve never purchased a house before will hinder the process, but when you work with the right real estate agent, there’s nothing to be afraid of.
Purchasing your first home can be a scary process. But now that you know the most common fears — and how to overcome them — it’s time to transform that fear into excitement, lets get out there, and find the home of your dreams!
With a tenant-occupied house can be a daunting task to sell but even investors whose Farmington Hills rental homes have served long and well as income-producers can eventually decide it’s time. Given today’s tight housing inventories, the current market does stack up as one where selling your tenant-occupied house can be a timely financial move.
But if that is under consideration, what should you do about the current tenant? Is it better to wait until the current lease expires—so that the vacated property can be shown without having to deal with an inconvenienced (and possibly miffed) tenant? Or will it be better to go ahead and list the property while it’s still occupied? Michigan landlord-tenant laws will have to be observed in any case, and specifics depend on the terms of the rental agreement, but experience teaches that following a few straightforward guidelines will usually solve any tenant-occupied Farmington Hills rental home sale issues before they become problematical.
As with so many “people” matters, keeping the lines of communication open should be the first order of business. For the planned sale of a tenant-occupied house, that means letting your tenant know as soon as possible that the house is going to be put on the market, and that you and your agent will actively minimize any inconvenience that might result. This is also the most opportune time to suggest that they consider buying the place themselves—an option that eliminates further complications.
If that’s not a possibility, be prepared to address their likely concerns, such as—
- Having to allow strangers into their home. Impress on the tenant that showings will only be conducted for qualified prospective buyers who will be escorted by your agent—a Michigan-licensed real estate professional.
- Having home life suddenly interrupted. Let them know the terms of your agreement with your Realtor® specifying the required advance notice for all showings.
- Having to move. This is only a possibility since their good history as a tenant increases the possibility that the new owner may choose to continue to offer the property as a rental.
A Tenant-Occupied House Sale Can be Smooth Sailing
The solution depends on the specifics. If you are selling a property that tracks well as an investment, tenants may be a plus. If you are selling an upscale property, having it vacant and staged to the 9s may well be your best bet (and a good one, too!).
In any case, the most accurate advice will come when you give me a call to come out and see your property. That’s how we can develop the right game plan!