When is the Best Time to Sell Your Home?
You may have heard many different opinions about when the best time to sell your home is. Spring? Summer? Fall? The fact is there are several factors that determine when it’s a good time to put your home on the market. Mainly, there are four criteria that are pretty solid cues that it may be time to sell:
• Low Inventory
• Low Interest Rates
• Rising Home Prices
• And Warm Weather
Take a look at this list and then talk to Agent about listing your home.
When Inventory is Low
During the height of the housing collapse, buyers had their pick of the litter with an overabundance of homes for sale all across the country. It’s when inventory is low that sellers have the advantage. If you are one of only a few people looking to sell in your area, you could find yourself smack dab in the middle of a bidding war!
If you have been thinking about selling your home, ask your agent about the inventory in your area. What is the current rate of home sales where you live? How many foreclosures? Is demand high for new homes? If housing supply is limited, now may be the right time for you to sell.
When Interest Rates are Low
A drop in interest rates often spurs on-the-fence buyers to finally make their move. If you’ve been thinking of moving up or downsizing, you may want to put your home on the market soon so you can start your search for a new one and take advantage of low interest rates.
Depending on the type of mortgage you take out, you could lock in a very low interest rate. That could mean paying less than 5% interest on your new mortgage over the term of your loan.
That is excellent news considering that the interest paid on a 30-year mortgage is only second to the principal on your mortgage in terms of cost. Wouldn’t it be great if you could knock off several thousand dollars in interest over the life of your loan? Check with agent to see just how much you could save with a low interest rate.
When Home Prices are Rising
When home prices are rising, it is great news for sellers, bad news for buyers. Unfortunately, the housing market can be very unpredictable. Trying to time your home sale with rising home prices could prove tricky. An experienced agent can best advise you about whether or not now is the time to list your house while your home’s value is on the upswing.
When the Weather is Nice
This is one that you may have heard before – spring is the best time to sell your home. According to a study by Zillow, this is good advice. Generally, in the early spring in warmer climates homes sell faster and for an average of 2% more. In areas where the climate is colder, the peak time to sell is late spring, early summer.
Combined with low interest rates and rising housing prices, if you time it just right, you could be looking at triple cherries right now. Could this be the perfect time for you to sell your home? Talk to the top agent in Sample City now to find out!
Understanding Home Inspection
When you are close to closing the deal on your home, one of the contingencies that need to be met is the home inspection. In fact, some sellers get a pre-sale inspection report long before they start entertaining offers, as this gives them more time to make necessary improvements early.
In order to keep your home sale from being derailed, it is imperative that you understand the home inspection. Who gets the inspection done? Can buyers trust your home inspection report? And what happens if you get a bad inspection report or if your report is refuted by the buyer’s inspector?
Who Does the Inspection?
Both parties typically get an inspection done. It makes sense. As the seller, you want to know what problems could complicate your sale. Plus, you want to know what repairs need to be done so you can get the most value for your home.
The buyer wants to make sure that they are not putting all of their hard-earned dollars into a money pit. They are not going to rely on your inspector’s report alone, nor should they. When both parties do an inspection, it protects both sides. But it can also create problems if the reports have conflicting results.
There are many ways to resolve those disputes that will not derail the transaction. In order for that to happen, both parties have to be willing to compromise:
• You can bring down your asking price to account for the recommended repairs.
• You could split the costs of the repairs with the buyer.
• You could get a third opinion from a neutral party.
Is Your Inspector Trustworthy?
The worst thing that can happen when there are conflicting reports is for trust to deteriorate. You can help avoid that by choosing a home inspector that is trustworthy, not just one that will give you a good report. Face it, even if they give you an artificially glowing report, the truth will come out in the end.
When a deal breaks down over the home inspection, inflexibility and a lack of trust is typically the culprit. If you are not willing to negotiate on the price when problems show up on your inspection report you are setting yourself up for a rough close at the very least and a busted deal at worst.
• Check the qualifications of your home inspector.
• Ask your agent to recommend a good inspector.
• Seek referrals from friends, family, and neighbors who can recommend a trustworthy inspector.
What Happens When You Get a Bad Inspection Report?
First of all, don’t panic. Take the case of a couple whose home inspector reported that their furnace was condemned and had to be replaced. That repair would have cost the couple thousands of dollars. Moreover, the report naturally made the buyers nervous about closing the deal.
What did the sellers do? They got a second opinion from a contractor who completely disagreed with the first inspector and declared the furnace fit. The buyers did not know what to believe so the seller called in the gas company to inspect the furnace – a neutral third party. When the gas company found nothing wrong, the buyers were satisfied.
Inspectors are not perfect. They can get it wrong sometimes. The best approach to take to the entire home inspection process is to be flexible, willing to compromise, and get a second or even a third opinion if necessary.
Lean On a Pro
A qualified agent can help you better understand all of the ins and outs of the home inspection process. Are you searching for a home inspector? Lean on a pro! Contact Agent today to learn more.
What is a CMA and Why Do You Need One?
A Comparative Market Analysis or CMA is a report that agents use to help determine the proper value of your home. It helps them to price your home based on other similar properties in your area. It is not an appraisal. It does not require an official inspection to produce.
It is important to know how much your home is really worth because homes that are overpriced tend to linger on the market for months and months. When a home is listed for more than 90 days, buyers start to get suspicious about the reason why, which often produces a domino effect. If interest is low it will deter other prospective buyers from considering your property.
You could have a perfectly lovely home that would have attracted a stampede of prospective buyers if only it was priced right. That is why a CMA is so important. It should be done before you list your home.
How Does a CMA Help You?
Both buyers and sellers use CMAs to their benefit. Buyers often request one in order to determine whether or not your home is overpriced. Besides helping to ensure that your home is priced appropriately, the CMA can also help you avoid making unnecessary improvements before the sale. If you’ve been thinking about remodeling your kitchen or replacing the siding, the CMA will show you which improvement will net you a higher ROI in your area.
Before you begin knocking down walls and laying tile, have a CMA produced so that you spend your money wisely when making improvements or upgrades before listing your house.
Who Produces the CMA?
Again, the CMA is not an appraisal. It is not done by an appraiser, but by the seller’s agent. Your agent will come to your house and do a general inspection of your home. It’s not as in-depth as a full inspection or appraisal. Your agent will just assess the overall condition of your home compared to others in your neighborhood.
Using market data specific to your location, your agent will analyze current market trends, assess how much similar homes in your neighborhood are selling for, and will use that information to set your asking price. Because your agent has access to listings that are not publicly listed and up-to-date market information, they are perfectly suited to produce the CMA for you.
Therefore if you are planning to make any upgrades or improvements, you should let your agent know when they come to assess your home. They can use that information to make a much stronger assessment and will be able to make recommendations about which improvements are most beneficial to you.
Is a CMA Mandatory?
The CMA is not mandatory but it is necessary. Your agent’s job is to put you in the best position to get a good return on your home. There are many reasons to use an agent to help you sell your home. Using an agent to produce an in-depth CMA so that you can price your home to move is one of the main reasons why. Contact Agent now to discuss how she can help you set the right price for your home today!
The Importance of the Appraisal
One step that sellers often overlook in the home selling process is the appraisal. You can hypothetically list your home for any asking price you want (of course that’s not the best strategy), but mortgage lenders will only approve buyers for the amount of the appraisal – and if it falls short of the agreed upon sales price, this could result in the purchase contract getting cancelled.
Understanding this concept will help you to grasp the importance of the appraisal when selling a home. It will also help you to make the right choices when pricing your home, as you’ll want to use the same information the appraiser will – market data, recent sales, comparable homes on the market – to determine the market value of your home.
What Does an Appraisal Involve?
A home appraisal, at its essence, is the process of determining how much a home is worth. The appraisal in a home sale is required by the lender (the buyer pays for it) and it is an essential step in the financing approval process. It is used to determine the fair market value of your home.
Whatever value is determined by the appraiser is the value that the lender will use to determine the loan amount that the buyer will be approved for. A licensed appraiser covers the entire property, including the house itself, the land, and any additional structures on the property. Factors that affect the appraisal include:
• Square Footage
• Number of Bedrooms
• Number of Bathrooms
• School District
• Home Interior Features
• Age of Home
• Unique Features
• Property Views
• Improvements or Upgrades
• Swimming Pools and Landscaping
If you fail to make repairs or improvements to your property or fail to point out upgrades and improvements to the appraiser, it could result in a low appraisal. Prospective buyers will use a home inspector to take a look at the property as well. It’s important to note that inspections and appraisals are two different processes, conducted for different reasons.
Different Types of Appraisals
There are four basic types of appraisals. Though most appraisers will use a comparison analysis appraisal, it is still good to know the different types to make sure that they’ll be using the right approach:
• Comparison Analysis Appraisal – Used to assess home values based on local neighborhood sales and uses the most current data
• Walkthrough Appraisal – In-depth appraisal where pictures are taken and the home is appraised from top to bottom and inside and out
• Tax Appraisal – Least useful for home value assessment as records are only updated annually
• “Drive-By” Appraisal – A quick snap analysis of the general value of the home, particularly noting the home exterior and surrounding area
Preparing for an Appraisal
Preparing for an appraisal is a lot like staging for an open house. In fact, if you approach the appraisal the same way, you can maximize the reported value of your home. Remember as well that most buyers are more interested in buying a move-in ready home.
An appraiser is different from an inspector. They are interested in the nuts and bolts of your home; its best features and how it compares to others.
• Clean the House
• Make Repairs and Upgrades
• Paint the Exterior
• Trim Landscaping and Drive
• Improve Curb Appeal
In most cases, the buyer’s lender will select the appraiser. However, if you’re doing an independent appraisal, the decision on which appraiser to go with has lasting repercussions. Make sure to shop around before deciding on an appraiser – and make sure that whoever you choose is on the lender’s list of approved appraisers. Ask questions about the data that they will use to appraise your home:
• Are they working from this year’s statistics?
• What are some of the market conditions that affect pricing?
• How many sources does your appraiser reference?
• How thorough will the appraisal be?
• Is the appraiser familiar with homes in your neighborhood?
Too many sellers only realize the weight of the appraisal when it is too late. Don’t be caught off guard. Contact agent to learn more about the importance of the appraisal and how to successfully navigate the process.
Home Selling FAQs
This is a quick rundown of the most common questions about home selling. Below you will find the answers to these questions to help you get a better understanding of what to expect.
How Do I Set My Asking Price?
First things first, you want to price your home as accurately as possible. That can be contrary to some advisors who suggest pricing high in a sellers’ market. Others suggest pricing low to spark more interest. It is a game to get into these types of price manipulations and someone inevitably loses. Avoid the risk altogether and set the price competitively for your particular area.
How Do I Attract House Hunters?
You will need to promote your home online in order to attract more house hunters. More than 90% of homebuyers begin their search online. They look at homes listed on national MLS portals or on local realtor sites. Some other things that you can do are:
• Spread the word via neighbors, co-workers, and friends
• Make furniture or quality appliances part of the deal
• Share your listing on social media
• Use a professional real estate photographer for listing photos
• Hire an agent with an excellent track record
Should I Renovate First?
To renovate or not to renovate is a question all sellers have. The answer is that it’s really subjective, but a few tips will help you decide.
• If you live in a part of the country that sees a lot of weather events like thunderstorms or snowstorms, storm windows and doors, roofs, and basements are good renovations if yours are lacking.
• For the most part, minor improvements like paint or a new front door can do more to improve the value of your home than a complete renovation.
• Fix the HVAC, repair floors, and clean out the basement or garage if you want to make a big improvement.
Should I Use a Stager?
Do you design home interiors for a living? If not, you should definitely use a stager. Buyers form a snap judgment about your home if things are untidy and out of order, so you should definitely make sure it’s spotless. However, to truly stand out, you want better than just a clean home. You could have a perfectly tidy house but it’s the overall aesthetics that will make or break a sale.
Here’s how you can get started with sprucing things up if you don’t want to call a stager yet:
• Clear out the clutter
• Cut the hedges
• Hose the driveway
• Plant fresh bulbs
• Wash ceiling fans and light fixtures
• Put away clothes and shoes
• Add lighting and accents
How Do I Negotiate the Best Price?
If you want to negotiate the best price for your home, use a professional agent. Studies show that sellers who use an agent to negotiate the deal get a much better price than those who sell on their own. A seasoned agent knows the process best and knows exactly what your home is worth.
Using an agent will also ensure that you get the most out of online advertising. Shop around for agents whose listings are the kind that get attention. That is the agent that you want to list with. Make sure to ask about all of the services that your agent will provide throughout the home selling process.