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5 NEGOTIATING TACTICS THAT KILL A SALE

(Published on - 10/29/2018 4:08:46 PM)

Negotiation is a subtle art in real estate, but skilled negotiators can usually find some common ground that satisfies all parties. On the other hand, using the wrong negotiation tactics can sink a deal pretty quickly. Here are some negotiation tactics buyers (and real estate professionals) should avoid:

 

  1. Lowball offers: Going far below market value when you make an offer damages your credibility as a buyer and can be insulting to the seller. The seller has a range in mind that they’ll accept, and if you’re not even approaching the low end of that range, they won’t even consider the offer.
  2. Incremental negotiations: Don’t continue to go back to the seller with small increases in your offer ($1,000 or less). The constant back-and-forth can grow tiresome and lead the seller to consider other opportunities.
  3. “Take it or leave it”: Try not to draw a line in the sand with your initial offer. The seller can get defensive and consider other offers if you immediately show that you’re unwilling to budge. Even if it’s true, don’t make a show of it.
  4. Nitpicking after inspection: Obviously if inspection reveals a major issue, it should be factored into the final sale price. But insisting on a lower price for every minor repair can put negotiations in a stalemate.
  5. Asking for more, more, more: Some buyers will request that the sellers throw in add-ons like furniture or appliances that weren’t included in the listing. Try to avoid giving the seller a reason to build up resentment and think that you’re being greedy.

SHORT SALE AND FORECLOSURE: HOW ARE THEY DIFFERENT?

(Published on - 10/29/2018 4:01:24 PM)

As unfortunate as it can be when homeowners fall behind on mortgage payments and must face the possibility of losing their homes, short sales and foreclosures provide them options for moving on financially. The terms are often used interchangeably, but they’re actually quite different, with varying timelines and financial impact on the homeowner. Here’s a brief overview.
A short sale comes into play when a homeowner needs to sell their home but the home is worth less than the remaining balance that they owe. The lender can allow the homeowner to sell the home for less than the amount owed, freeing the homeowner from the financial predicament.
On the buyer side, short sales typically take three to four months to complete and many of the closing and repair costs are shifted from the seller to the lender.
On the other hand, a foreclosure occurs when a homeowner can no longer make payments on their home so the bank begins the process of repossessing it. A foreclosure usually moves much faster than a short sale and is more financially damaging to the homeowner.
After foreclosure the bank can sell the home in a foreclosure auction. For buyers, foreclosures are riskier than short sales, because homes are often bought sight unseen, with no inspection or warranty.

HOW DO YOU KNOW WHEN IT’S TIME TO SELL YOUR HOUSE?

(Published on - 9/19/2018 10:08:05 PM)

Is it time to sell your house? Or should you wait and see if home values continue to climb? Knowing when it’s time to sell your house can be tricky. But we have some tips to help. Here are the best indicators that it’s time to sell.

You’ve built equity in the house.

The most important factor in deciding when it’s time to sell your house is your home equity. How much money would you be able to keep from the sale of your house after you pay off any remaining mortgage loan and your closing costs?

If your sale price is high enough to break even on those costs, you’re clear to sell. But if you can keep enough money from the sale to put 20 percent down on your next house, you’re golden! That amount of equity is a great indicator that now is the time to sell your house.  

Your local market is hot.

Trying to time the market perfectly is a fool’s errand. But it’s certainly better to sell your house when your market’s hot. In a hot market, you have more buyers than listings. So the buyers compete for the limited housing inventory, which means higher home prices. That’s great news for sellers.

Thanks to low mortgage interest rates and a well-recovered national economy, there are hot markets all over the country. You local Realtors® can explain your current market conditions and provide insight as to how hot your local market is.  

You’re emotionally ready for the next phase of your life

Market conditions mean nothing if you’re not emotionally ready to sell.

Are you ready to move onto the next phase of your life? So ready that you’re willing to invest the time and effort in preparing the house for sale, scheduling your week around showings, working through the sales paperwork, and actually moving?

These short-term inconveniences lead to a reinvigorating fresh start. Are you ready to take that big step?

What about the season of the year?

Traditional wisdom is that spring and summer are the best time of year to list your house for sale. Buyers are looking to make a move while the kids are out of school, there are more hours of daylight to spend house-hunting, and the weather is conducive to touring properties, moving, and even tackling move-in renovations.

But if you’re in a geographic area that doesn’t experience all four seasons, time of year will have a much lower impact on your ability to find qualified buyers. You could even experience a surplus of buyers motivated to get settled in their new home before the holidays!

If you’re on the fence about selling, talk to a local Realtor®. They can explain local market trends to help you decide, with certainty, if now’s the time to sell your house.

This post is intended for informational purposes only and should not be taken as professional advice. The point of view and opinions expressed in this post are those of the author and do not necessarily reflect the position of Realty Executives International. This post was written by Michelle Clardie. Michelle is a professional real estate blogger, specializing in ghostwriting Realtor® blogs. Her engaging content helps real estate agents become more visible online, generate more qualified leads, and increase their revenues. You can learn more at www.michelleclardie.com


RED FLAGS TO LOOK FOR WHILE HOME SHOPPING

(Published on - 9/19/2018 10:02:50 PM)

It can be so easy to get caught up in things like curb appeal and low prices while searching for a new home. While these things are definitely enviable qualities for any new home, they also tend to distract potential home owners from other, more unworthy elements a house on the market might be hiding. Buyers should always be mindful of these red flags:

Neglected Septic Systems

A surprising number of homeowners will put their house on the market with a septic that hasn’t been serviced in years. As a general rule of thumb, buyers should always ask the seller for documentation showing the last time they got their septic serviced, inspected and pumped—which should be every three to five years.

Rotting Wood    

There are a handful of issues that buyers can work with after purchasing a home. Rotted wood isn’t one of them. Wood that has been subjected to vast amounts of moisture over extended periods of time isn’t just a pain to replace, it could also jeopardize your health (read: fungus exposure). Buyers should always carefully inspect the kitchen, bathroom, exterior, deck and trim for signs of rotted wood.

Faulty Repairs  

It might be hard to tell exactly what has been worked on over the years in a home that has recently placed on the market. Even still, buyers must keep an eye out for any incomplete or flawed repairs throughout the house they’re looking to purchase. Faulty plumbing, electric and even appliance repairs will cost buyers more time, effort and money in the long run after buying a house that has them.

Poor Drainage    

When a home has an improper drainage system, it opens a can of worms that not even the most optimistic Fixer-Upper lover will want to deal with. If a seller confides in a buyer that their house is subject to drainage issues, it usually means that there is poor drainage surrounding the home’s exterior. This will almost always lead to extra water leaking into spaces like the basement and garage—and will seriously affect the foundation of the home.  

Old Heating and Cooling Systems     

Heating and cooling systems are a pretty important element of any home, whether it’s in a residential development or a townhouse community. Aged heating and cooling systems are usually found in older homes on the market, and will leave buyers with a lot of pricey maintenance fees. It gets worse: Heating and cooling systems that are damaged and worn can also produce harmful carbon monoxide fumes. Buyers should either rule out these older heating and cooling systems, or make sure that the seller will fix any issues with it before making any final moves.

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5 Reasons You Shouldn’t For Sale by Owner

(Published on - 2/23/2018 7:11:00 PM)

Some homeowners consider trying to sell their home on their own, known in the industry as a For Sale by Owner (FSBO). We think there are several reasons this might not be a good idea for the vast majority of sellers.

 

Here are five of our reasons:

1. There Are Too Many People to Negotiate With
Here is a list of some of the people with whom you must be prepared to negotiate if you decide to FSBO.
The buyer who wants the best deal possible

  • The buyer’s agent who solely represents the best interest of the buyer
  • The buyer’s attorney (in some parts of the country)
  • The home inspection companies which work for the buyer and will almost always find some problems with the house
  • The appraiser if there is a question of value
  • Your bank in the case of a short sale

2. Exposure to Prospective Purchasers
Recent studies have shown that 92% of buyers search online for a home. That is in comparison to only 28% looking at print newspaper ads. Most real estate agents have an internet strategy to promote the sale of your home. Do you?

3. Results Come from the Internet
Where do buyers find the home they actually purchased?

  • 43% on the internet
  • 9% from a yard sign
  • 1% from newspapers

The days of selling your house by just putting up a sign and putting it in the paper are long gone. Having a strong internet strategy is crucial.

4. FSBOing has Become More and More Difficult
The paperwork involved in selling and buying a home has increased dramatically as industry disclosures and regulations have become mandatory. This is one of the reasons that the percentage of people FSBOing has dropped from 19% to 9% over the last 20+ years.

5. You Net More Money when Using an Agent
Many homeowners believe that they will save the real estate commission by selling on their own. Realize that the main reason buyers look at FSBOs is because they also believe they can save the real commission. The seller and buyer can’t both save the commission. Studies have shown that the typical house sold by the homeowner sells for $184,000 while the typical house sold by an agent sells for $230,000. This doesn’t mean that an agent can get $46,000 more for your home as studies have shown that people are more likely to FSBO in markets with lower price points. However, it does show that selling on your own might not make sense.

Bottom Line

Before you decide to take on the challenges of selling your house on your own, sit with a real estate professional in your marketplace and see what they have to offer.


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