Checklist for Selling Your Shop Worn Home
April 18th, 2011 § 1 Comment
Agents refer to you as an expired listing. The MLS now has your CDOM (cumulative days on market) number and all the buyers will know you’ve
Photo from Flickr by Cristiano Betta
been trying to sell for awhile. Many northern Kentucky home sellers are in the same boat. Listing inventories are high and not really expected to change significantly in the next year. This simple checklist will go a long way to determining your successful sale. If you’re like most people you need to change your mindset about “getting rid of the old” and focus on merchandising your property for favorable appeal. All of the checklist items must be in place in order to insure that your property is marketable at top dollar, in today’s environment.
- PRICE, PRICE, PRICE. Are you priced better than the competition? Today’s buyers are informed, they have market data information at their fingertips. Believe me, they know how much every house in neighborhood is priced at. They are shopping and comparing like no other time in the past. You MUST be priced at just under your closest competition.
- FINANCING. Is your property available for all types of financing? Over 50% of all transactions last year were financed on FHA loans. Your home needs to be FHA approvable or you’re going to be missing out on 50% of the buyers. Better yet, why not make your property more attractive than the competition by offering to pay the buyers closing cost, a key element in decision making for cash strapped buyers.
- COMPLETE REPAIRS or DEFERRED MAINTENANCE. This kind of goes along with the financing item from above but you need to take it one step further and remove any possible objections to the condition of your home. Is your carpet worn, dirty or stained? Replace it now, before your home hits the market.
- CURB APPEAL. You curb appeal must be pristine and inviting. First impressions are a huge factor in buyers determining likeability. Paint the front door, weed and mulch the landscaping and add some potted flowers near the door.
- OCCUPANCY AT CLOSING. The days of the seller remaining in a property for 30 days after closing have long since past. Anything less than day of closing occupancy will probably deter buyers from even comparing your property.
- ALL APPLIANCES INCLUDED. Today’s buyers are usually scraping together every bit of cash they can in order to qualify for a loan. Some buyers are very concerned that they will be cash poor after the purchase and will not be able to afford appliances. Homes with all appliances included will be more competitive in the market.
- AVAILABLE FOR IMMEDIATE SHOWINGS with KEYBOX. Yes, I know, what a huge inconvenience. But, so important in today’s market. Not always, but occasionally an agent will call to set an appointment with very little notice and you need to be ready to show at anytime. Today’s buyers will not work around the sellers schedule; they simply move on to the next property and don’t look back.
- HOME WARRANTY included.
- STAGED. Stage your interior for selling. For most people it means getting rid of 20%-50% of your stuff. Kitchen counters cleared, no refrigerator magnets, remove family photos from the walls, clear out closets, put some furniture in storage etc. Or, get a home stager to come in and tell you what needs to be done.
These are just some of the things your CENTURY 21 agent can help you with in order to market your home effectively.
Give us a call at 859-363-9900 or
contact us on our web site at http://NorthernKentuckyHomes.com
If a bank listed a house for $25,000 more than they paid at the foreclosure auction, will they take $35,000 less?
April 4th, 2011 § Leave a Comment
If a bank listed a house for $25,000 more than they paid at the foreclosure auction, will they take 35,000 less?
The house was foreclosed on in Boone county Kentucky and the foreclosure sale did not bring what the bank had hoped for so they bought it for $160,000 and have it listed for $185, 000, What are my chances the bank would take a $150,000 offer?
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It depends. First off, the people who are handling the sale of the property now that the bank owns it probably (sometimes they do) have no idea what the bank had to bid for it. Actually, the bank didn’t really pay anything for it at the court house steps, they were just protecting what they had invested. There was no one else at the foreclosure sale willing to bid any higher than the banks last bid.
After foreclosure, an asset manager is charged with getting the maximum dollar from the resale. Sometimes the resale is for far more than the amount owed when they foreclosed and many times here recently it’s for far less than what was owed. The asset managers will usually get a licensed appraiser to give them a current value, as well as getting marketability report from a couple different brokers .
The asset manager then has to decide what price to offer the property for sale. Based on their own “unscientific” plan they considering what is a reasonable amount of time on the market and how badly they need to get rid of it. If the property doesn’t sell in the time frame they had established they will reduce the price. I’ve always considered it, and explained it as, a reverse auction. I’ve seen offers rejected by the bank this week and then a price reduction next week to a price lower then they just rejected. With some asset management companies / banks the person who reviews the offer is not the same person who manages the marketing efforts.
The trick is, knowing when to jump. Here are a few questions I always try to ask or determine of buyers for foreclosed properties (or any property really). Maybe answering some of these questions for yourself will help you make a good decision.
- How bad do you want it?
- Is this the “house for you” or are you buying strictly as a business decision/ investment?
- How long have you been looking for a house? Is a “really great deal” the most important aspect in buying?
- If you don’t get this one are there half a dozen others for sale that you’d be happy with or is this the only one that fits your buying parameters?
- What’s the property worth to you? If it’s $170,000, then offer $170,000 and if you get it GREAT! But if you don’t get it be satisfied that you made your best offer. But if it’s worth $182,000 to you, then offer $182,000.
Just be happy with the price you decide to offer. Have your agent do all the home work for comparable sales, time on the market and current competition. They can help you answer the questions you need to know to make an informed decision.
Inspect, inspect, inspect. But don’t be unreasonable, not everything will be perfect. Just last month we had a buyer turn down a house from inspection because the listing agent could not get the water on for inspection in a reasonable time. The buyer self proclaimed getting the house for 85% of the value, so basically they turned down $25,000 of built in equity, for a maximum, $2,500 in plumbing repairs. As it turned out, the agent finally got the water on and the only repair needed was a new shut off valve for $150.
Buying a foreclosed property is not for everyone. There are some great deals to be had, but having an agent who is knowledgable in foreclosures could save you time and money. If you want to buy a foreclosed home interview some agents and find out how many foreclosed homes they have sold in the past 6 months.
Doug Garner, Principal Broker
CENTURY 21 Garner Properties
Is The Real Estate Gold Rush On?
January 21st, 2011 § Leave a Comment
While most people were scurrying about doing all the traditional December Holidays rush at least a significant hand full of people where BUYING HOUSES. The December statistics were released yesterday and existing home sales increased by 22.5% for the month of December.
As I’m sure your aware December is traditionally one of the slower months for real estate sales. What was it that caused an increase we’ve not seen in a decade? I don’t think anyone can put their finger on any one dominate event or change in the market that you could pin the increase on. However there were several quiet things going on that may have individually lead to buyers deciding to buy. Is the turbulent real estate market rumbling up a perfect storm? Maybe. One of the things going on is financing. Even though interest rates are not as low as they were most of last year. Many buyers have stated that the slight increase in rates is what got them off the fence and ready to buy. The fact that rates increased was their cue to get moving before rates went any higher. In some cases it may have been that many of the foreclosed homes that were put “on hold” came back on the market near the end of November, and many with significant price reductions. That, accompanied by the now general belief that prices have truly bottomed out, created a motivation and urgency to get that great deal before it was gone. Additionally, we are seeing buyers purchasing that were not qualified earlier in 2010. I know in my office we have worked with several buyer throughout the year that were repairing credit and saving for down payments in order to qualify. Maybe the market is finally adjusting to the abrupt changes in financing that we seen in 2008-09.
5 Steps For First Time Home Buyers, 2011 version
January 17th, 2011 § 1 Comment
Today’s home buying process can be very confusing for first time buyers. Heck, it can be very confusing for anyone who hasn’t bought real estate in recent years. The changes to financing and market conditions have dramatically changed, and are changing almost daily. I’ve run into many cases where even agents have not been able to keep current with market conditions and have cost their clients dearly in time on the market for sellers, or missed opportunities for buyers. Find out now what simple steps you can follow to make the home buying process easier and a more user friendly.
Step 1. Do a little home work, phone a friend or get on the internet and research what agent may be best suited to help you through the home buying process. Give them a call and ask some questions until you’re comfortable in the fact that they are the best choice for you in your home purchase. If your communication preference is by email and text message are they able to accommodate that? How many first time buyers have they sold a home to in the last 12 months? Many times the best deals are sold in the first few days of being listed for sale. Can they provide you with up to the minute new listings and automatically email them to you? Contrary to popular belief every home does not sit on the market for 6 months before someone makes an offer. Can the agent help you determine help you determine the financing options available to you and help you decide on a lender?
Step 2. Find out what you can afford to pay for a house. It takes a little more cash up front than it did during the “nothing down” days of the early millennium. However there are still great programs that offer very low downpayments. Credit scoring has become the key factor for mortgage underwriters in determining your ability to repay the loan. Talk to an real estate agent in advance and they may be able to help you determine what type of financing would most likely be suited for you and they can help you find a lender with expertise in those type of loans. Essentially the lender will look at 4 things.
- Cash – How much you have available to purchase and how much you will have for reserves after your home purchase.
- Income and Expenses – How much money do you make and how long have you been on your job.
- Credit- What’s your credit score?
- The property – if your looking for a fixer-upper then financing is an entirely different ball game, Let your agent know in advance of your intentions about buying a house that’s already in livable condition or one that may need a little TLC before you can move in. It may be that your not sure yet and that’s ok. An agent can help you obtain a pre-approval for either situation.
A recent change in the financing end of the home buying process is that it’s not as easy to get a pre-approval letter as it used to be. As of Jan. 1, 2010, the Department of Housing and Urban Development (HUD) began requiring lenders and mortgages brokers to issue a binding Good Faith Estimate (GFE) within three days of receiving a loan application. In other words, what lenders used to be able to do over the phone may now require a face-to-face visit with you.
Current market conditions are such that most sellers will not even look at an offer that does not have some kind of a pre-qualification letter or pre-approval letter attached. Even then, some sellers are investigating the buyers qualifications and approvals before acting on an offer.
Step 3. Not sure exactly what you wanting to buy? Don’t waste your time scouring through any real estate magazines. Your agent should be able to direct you to a user friendly web site that makes it easy to browse properties. Maybe area is most important to you, stick to that area or search my maps. Maybe area doesn’t matter as much as number of bedrooms or style of house. Make a list of wants and needs for your new home then narrow down your wants and needs to merely “have to haves” and leave out the “would like to haves” so you can browse through a wider range of what is available in your price range. You can at least be comfortable in the fact that the properties your browsing are current and ready to be sold. The days flipping through stale information in magazines have long since past because of the time involved and only to find the perfect property was sold last month is a frustration you can do without.
Step 4. Look all you want to. Most first time buyers want to see everything on the market in their price range because they’re not really sure what they want. That’s okay. You need to become comfortable in knowing what is available to you and what is not. Your goal is to buy in the best neighborhood you can afford without overextending yourself financially. Don’t buy a home that you will outgrow in the next couple of years. The economic recovery is going to take years. You don’t want to be caught having to sell at a price lower than what you paid. Even if prices don’t decline further, you won’t bankrupt even if you sell for the price you paid. Buy a home that has broad appeal and good resale potential. Don’t buy that unique, quaint little hideaway because that’s what you’ve always dreamed of. Keep the dream alive for when you ready to move-up, have more experience in home buying and potentially more capitol to speculate with.
However, when that one property comes along that just feels right, BE READY TO JUMP. I’ve seen many situations recently where the deal of the decade got away from someone who “wanted to think about it”. Or, the buyer was just to busy to look until the weekend. What’s to think about? As long as you’ve followed the steps up until now you should be comfortable making a decision. Chances are good that if you and your agent think this property is right for you, there’s a half dozen other buyers who also think it’s right for them. The early bird gets the worm holds many truths in house hunting. Here’s another tip to help first time buyers. If Mom, Dad or Dear old Gramps needs to look at your find before you can commit to making an offer then they need to be in on the entire process from the beginning. Don’t put them in a no win situation. It’s not fair for you or them. If they say no, they stand the chance of killing your dream and they usually don’t want to do that. If they say yes and something goes drastically wrong then they may consider it to be their fault. (just the pressure may cause them to be reluctant to commit.) If they have participated in your house hunt from the beginning they will be in a much more comfortable position to help you make a decision.
Step 5. Just because you found a house, made an offer and the seller agreed don’t think you bought a home YET. The accepted offer is just the beginning of another 30 days worth of inspections, appraisals, insurance agents, underwriters and a whole host of other “things” that could go wrong. In other words, don’t schedule a mover the day after you have an accepted contract. There are many things, most of which are out of your control, that can go wrong. You have a long way to go before you can profess that you are a homeowner.
New Kentucky Condo Seller Certification Law
January 7th, 2011 § Leave a Comment
As real estate agents everywhere in Kentucky scramble around to figure out how they are going to help seller’s comply with Kentucky’s new Condo Law (Ky HB 391) that took effect on January 1, 2011, the Kentucky Real Estate Commission comes to the rescue with a new Condo Seller’s Certificate. Unlike the current Sellers Disclosure of Property Condition, which is only required for transfers of real estate involving a licensed real estate agent, the new condo law effects anyone in Kentucky transferring ownership of a condominium for any reason. I’ve heard rumors of exemptions from this law, but at this point no one has been able to direct me to any written opinions to any exemptions.
