Why Isn't My Home Selling?
Price is the No. 1 culprit
If your answer is price, you’ll be right a good majority of the time. If your home isn’t selling, buyers think the value of your house is less than the price you want.
For all the time and effort that goes into buying and selling, the economics of the process is relatively simple. Anything is only worth what a buyer is willing to pay and a seller willing to accept. This is the same whether it’s a pack of baseball cards or a $1 million house.
Although the economics may be simple, arriving at that magic price is difficult. Just think of the cost, time and energy that companies put into pricing a product so it succeeds in the marketplace. It’s no different in real estate.
If you’ve taken the time to educate yourself on the local market and are diligent in hiring a professional agent, and are willing to listen to her, you can get a lot closer to the magic number. But you are setting yourself up for disaster if you don’t do your homework and go with what you “feel” your house is worth. Worse yet, is interviewing agents and choosing one solely because she says she can get you more than what the other agents think the house will sell for.
These are some of the most common mistakes sellers make when setting a price:
Price based on need
What you want to make from selling your home means absolutely nothing to buyers or the marketplace. So setting a price based on what you want so you can retire, move up, start a business, etc. will almost certainly fail.
Price based on ego
Your neighbor sold for $200,000 last year so you want $210,000 because you “know” your house is better. Regardless that the market dropped five percent since your neighbor sold. Nearly every owner thinks their house is the best on the block, or at least better than any of the ones that have recently sold or are on the market. Unfortunately for sellers, your opinion doesn’t carry any weight with buyers. Only their opinion matters.
Price based on greed
Even if it’s been shown that your house will likely sell for around $250,000, you insist on listing it for $275,000 because “you never know, someone could come along who just has to have it. Besides, if we don’t get any bites we can always lower the price later.” The problem is it won’t take long for buyers to realize your price is unrealistic and think you are, too, and won’t want to deal with you unless the house is “a steal.” The listing languishes, so you drop the price, but not enough, it sits even longer and pretty soon you have a listing that’s been on the market so long buyers decide there is something wrong and steer clear.
The solution is to get the price right. This is done by using what is called a Competitive Market Analysis (CMA). If you’ve hired the right agent, this is the first folder out of their briefcase when you meet to list your home. A CMA breaks down the sales price of homes that are similar to yours in location, size, age and condition.
Your agent will also consider the listing prices of homes on the market, but these are used more to identify the competition. Even with a strong agent and CMA, your price may not be on target. That’s because the market is always changing and your agent should be updating your CMA whenever anything comparable to your property sells.
Not every reason your home isn’t selling will be the price, although they will be related to it. Here we have that value vs. price issue. If buyers perceive imperfections in your listing, they will want a discount, so if they’re not buying, your price is not discounted enough for buyers to believe the value to them at least equals that of your price.
For example, if your lawn is brown and the landscaping worn, buyers will want a discount. The problem is that a seller will not consider this a major issue and attach a much lower discount than a buyer will accept.
This is why it is imperative that sellers do everything they can to eliminate any issues buyers may have with their house before listing. Obviously, you can’t do anything about a bad location, such as being near railroad tracks, or that you have just one bathroom. But you and your agent should have factored these drawbacks into the listing price.
Here are some of the most common reasons buyers are turned off by a particular house, so make sure these are addressed before lopping thousands of dollars off the asking price:
Put on a good show
This is the second biggest reason a home isn’t selling. Buyers often talk of “connecting” to a house. This is not likely to happen if your house is not company-coming-over clean and ready to show like a model. This goes for the outside as well. If you don’t want to put the effort into doing this, then you’d better adjust your price to compensate because buyers will only consider your house because it’s a good deal, not because it “speaks to them.”
Can’t buy what they can’t see
If you make it difficult for people to see your property, then chances of a sale at the price you want drops considerably. Selling can be a nuisance, but it’s a necessary one. If you don’t allow a lockbox or require appointment-only showings, you are the culprit to the house not selling.
Out of your hands
It’s not always the seller’s fault that a house isn’t selling. Sometimes the market changes and buyers disappear. Maybe a new home development has opened nearby and they are “stealing” the customers. Or maybe you’ve received bad advice from your agent. Any of these can affect whether your house sells, which means you need to consider the reasons and make the necessary adjustments.
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Copyright © by Move, Inc. By Diana Lundin
Showing posts with label Buyers Market. Show all posts
Showing posts with label Buyers Market. Show all posts
Friday, August 12, 2011
Saturday, May 8, 2010
Buy or Sell First????
Consumers Are Returning to the Real Estate Market with an Age-old Question: Buy or Sell First?
Residential real estate is gaining stability in concert with the recovering U.S. economy. Consumers, drawn by one of the most attractive buyers’ markets on record marked by historically low interest rates and lower home prices in many areas, are returning to the market to move up, trade down, improve location and otherwise enhance their share of the American Dream.
When it comes to home buying, the ideal situation would be to find a new home, just as you receive an offer on your existing home. You would then be able to close concurrently and move into your new home a few days prior to closing on your previous home. This does happen more often than not, but anyone looking to buy a new home needs to consider all the possible scenarios.
Should you buy or sell first? There are many schools of thought on this subject. Ultimately, it depends on you and your situation. For instance, can you afford to pay two mortgages in the event your previous home does not sell by the time you move? Would you consider a bridge loan (a short-term, high-interest loan that lets you borrow against the value of your old home to covers the bills until you secure the new, larger loan)? Are you willing to move twice to find the home of your dreams if you sell first and can't find the dream home fast enough?
This is where the advice of a real estate sales professional is invaluable. Real estate sales professionals know the current market conditions. They are trained and experienced in working with home buyers and sellers to determine an ideal time to buy and sell.
It is generally less stressful to sell your home first, because you won't have to worry about owning two homes at one time. The market will dictate how long it will take for your home to sell, as will the property’s location and the time of year. As a rule of thumb, it is a good idea to put your home of the market as far in advance as possible when purchasing a new one. But, since interest rates are low and confidence is returning to the market, there’s a good change your home will sell faster if priced properly. (Again, your real estate professional’s advice is critically important here.) In that case, you may want to purchase a new home first.
What if your present home sells before you find a new one, putting pressure on you to find the right house more quickly? You may then decide to make an interim move or request to rent back your home for a specified amount of time as you continue to look for your new home. Those may be worthwhile options if you have your heart set on a specific location or type of home or if you are purchasing a home that is under construction.
If you buy a home before selling your present home, you may end up with two mortgages. Under those circumstances, you may be able to apply for a bridge loan to assist you in making two mortgage payments until you sell your first home. Your real estate sales professional can assist you in finding a lender.
So should you buy or sell first? This is a challenging question regardless of real estate cycles, yet your own circumstances and a knowledgeable real estate professional will help you make the right decision.
Prudential Fox & Roach is an independently owned and operated member of Prudential Real Estate Affiliates, Inc., a Prudential Financial company. Equal Housing Opportunity.
Residential real estate is gaining stability in concert with the recovering U.S. economy. Consumers, drawn by one of the most attractive buyers’ markets on record marked by historically low interest rates and lower home prices in many areas, are returning to the market to move up, trade down, improve location and otherwise enhance their share of the American Dream.
When it comes to home buying, the ideal situation would be to find a new home, just as you receive an offer on your existing home. You would then be able to close concurrently and move into your new home a few days prior to closing on your previous home. This does happen more often than not, but anyone looking to buy a new home needs to consider all the possible scenarios.
Should you buy or sell first? There are many schools of thought on this subject. Ultimately, it depends on you and your situation. For instance, can you afford to pay two mortgages in the event your previous home does not sell by the time you move? Would you consider a bridge loan (a short-term, high-interest loan that lets you borrow against the value of your old home to covers the bills until you secure the new, larger loan)? Are you willing to move twice to find the home of your dreams if you sell first and can't find the dream home fast enough?
This is where the advice of a real estate sales professional is invaluable. Real estate sales professionals know the current market conditions. They are trained and experienced in working with home buyers and sellers to determine an ideal time to buy and sell.
It is generally less stressful to sell your home first, because you won't have to worry about owning two homes at one time. The market will dictate how long it will take for your home to sell, as will the property’s location and the time of year. As a rule of thumb, it is a good idea to put your home of the market as far in advance as possible when purchasing a new one. But, since interest rates are low and confidence is returning to the market, there’s a good change your home will sell faster if priced properly. (Again, your real estate professional’s advice is critically important here.) In that case, you may want to purchase a new home first.
What if your present home sells before you find a new one, putting pressure on you to find the right house more quickly? You may then decide to make an interim move or request to rent back your home for a specified amount of time as you continue to look for your new home. Those may be worthwhile options if you have your heart set on a specific location or type of home or if you are purchasing a home that is under construction.
If you buy a home before selling your present home, you may end up with two mortgages. Under those circumstances, you may be able to apply for a bridge loan to assist you in making two mortgage payments until you sell your first home. Your real estate sales professional can assist you in finding a lender.
So should you buy or sell first? This is a challenging question regardless of real estate cycles, yet your own circumstances and a knowledgeable real estate professional will help you make the right decision.
Prudential Fox & Roach is an independently owned and operated member of Prudential Real Estate Affiliates, Inc., a Prudential Financial company. Equal Housing Opportunity.
Tuesday, December 1, 2009
Owning a Home Has Its Benefits
By Joanne Genesio
Prudential Fox & Roach
Opportunity is knocking for those considering homeownership for the first time. Historically low interest rates, lower home prices in most markets and the first-time homebuyer tax credit – part of the American Recovery and Reinvestment Act of 2009 – brought first-timers to the market in droves throughout the year.
In fact, these consumers represented about half of home sales logged during 2009, according to the National Association of REALTORS®, a significant increase from historic levels. And the favorable conditions that prompted many of these first-time buyers are likely to continue. President Obama in early November signed into law a five-month extension of the first-time homebuyer tax credit of up to $8,000, as well as a new tax credit of up to $6,500 for existing homeowners who want to purchase a home to be their primary residence (see your real estate professional and tax advisor for details). Both credits will be available through April 30, 2010.
Today’s opportunities aside, here are eight time-honored reasons why those considering homeownership for the first time should make their move.
1. Pride of Ownership Owning your own home adds to your own sense of self-esteem and personal pride. The satisfaction that comes from feeling connected to the land you occupy and the home in which you live is ages-old.
2. Security of Tenancy
With homeownership comes stability. When renting, you never know when you may have to move because of new ownership, rent increases or other changes. As a homeowner, you decide when and if you want to move.
3. Privacy
While there are usually some limits on the access landlords have to property, almost all landlords can access your property for necessary inspections and maintenance. For many renters, this lack of privacy is a significant discomfort. Homeowners on the other hand generally have much stronger property rights and experience an increase in perceived and actual privacy.
4. Decorating
Homeowners are free to decorate, remodel and accessorize a home any way they want. Not only do you have the right to make improvements, but the value of those improvements becomes yours as well. Having your living space and exteriors just the way you want them can significantly increase your satisfaction with your living environment.
5. Financial Predictability
When you buy a home with a fixed-rate mortgage, you have more predictability over future housing costs. Because your interest rate never changes, the amount of your payment never changes. Financial planning and credit are more easily managed with a fixed-rate mortgage compared to renting.
6. Building Equity
When you own your own home, you pay rent to yourself instead of a landlord. Most homeowners pay for their purchase by obtaining a mortgage. As you pay off that mortgage, your equity builds and you gain an increasingly larger share in a valuable asset. Over time, that asset can work for you in many ways, such as home equity lines of credit. And of course, a home is a wonderful asset to pass along in an estate.
7. Investment Appreciation
There are certainly no guarantees of property value appreciation. In the long-term, however, real estate valuations almost always increase. This means that when you decide to sell your home, its value may be significantly higher than when you purchased it. The difference in value is called appreciation. You can reinvest that appreciation in other real estate or you may wish to downsize and keep the value of that appreciation for retirement or other purposes.
8. Tax Benefits
In the United States, the cost of home mortgage interest and property taxes are usually tax-deductible. Depending on your circumstances, thousands of dollars in taxes can be saved each year. These tax savings are not limited to federal taxes either. Many states and localities either base their tax system on the federal system or offer similar incentives to homeownership. Some additional benefits are designed specifically for first-time homebuyers. (See your tax advisor for additional information.)
If you still have doubts, contact a real estate professional in your community. He or she can answer questions you may have about homeownership and explain the buying process to you.
Joanne Genesio can be reached at (215) 641-2413. Prudential Fox & Roach is an independently owned and operated member of Prudential Real Estate Affiliates, Inc., a Prudential Financial company. Equal Housing Opportunity.
Monday, November 2, 2009
Extending the First Time Home Buyer Credit?????
Extending the Credit — Almost There
The extension and expansion of the homebuyer tax credit is the pending business in the Senate. After a long week of negotiation on the credit, an agreement on the scope of both expansion and extension has been reached. The extension is part of a larger bill that has not yet gone to a vote, however. A Senate vote on the underlying bill will occur in the Senate during the week of November 1. The package will then go back to the House. The House is expected to accept the Senate amendments, vote on the package and send it to the President for signature. The underlying bill is an extension of unemployment benefits. Other provisions in the bill include expansion of the net operating loss carryback rules, new requirements for some tax return preparers and noncontroversial provisions that "pay for" these changes.
The agreement on the extension and expansion of the credit is as follows:
Credit available for purchases before May 1, 2010. Prospective purchasers with binding contracts in place as of April 30, 2010 will be allowed an additional 60 days to complete the transaction.
Credit remains at $8000 for first-time purchasers. No change to definition of first-time purchaser.
New $6500 tax credit for repeat buyers who purchase between December 1, 2009 and May 1, 2010. Repeat buyers must have lived in their homes consecutively for 5 of the previous 8 years.
Income limits are expanded to $125,000 on a single return and $225,000 on a joint return. Current law $20,000 phase-out retained.
New anti-fraud limitations are imposed.
The White House has indicated that President Obama will sign the legislation.
Call Your Senator
Take Action
Visit www.realtor.org/2009housingtaxcredit
The extension and expansion of the homebuyer tax credit is the pending business in the Senate. After a long week of negotiation on the credit, an agreement on the scope of both expansion and extension has been reached. The extension is part of a larger bill that has not yet gone to a vote, however. A Senate vote on the underlying bill will occur in the Senate during the week of November 1. The package will then go back to the House. The House is expected to accept the Senate amendments, vote on the package and send it to the President for signature. The underlying bill is an extension of unemployment benefits. Other provisions in the bill include expansion of the net operating loss carryback rules, new requirements for some tax return preparers and noncontroversial provisions that "pay for" these changes.
The agreement on the extension and expansion of the credit is as follows:
Credit available for purchases before May 1, 2010. Prospective purchasers with binding contracts in place as of April 30, 2010 will be allowed an additional 60 days to complete the transaction.
Credit remains at $8000 for first-time purchasers. No change to definition of first-time purchaser.
New $6500 tax credit for repeat buyers who purchase between December 1, 2009 and May 1, 2010. Repeat buyers must have lived in their homes consecutively for 5 of the previous 8 years.
Income limits are expanded to $125,000 on a single return and $225,000 on a joint return. Current law $20,000 phase-out retained.
New anti-fraud limitations are imposed.
The White House has indicated that President Obama will sign the legislation.
Call Your Senator
Take Action
Visit www.realtor.org/2009housingtaxcredit
Sunday, October 25, 2009
Get Pre-Approval before Beginning your Home Search
One of the most exciting and highly anticipated events in your venture to real estate is when you go house hunting to finally discover your sought-after dream house. You may have set yourself all geared up for a great home search adventure yet you need to know first the most important component that ought to signal the start of your venture. Loan pre-approval must be on top of your priority list before you go any further in your pursuits for home acquisition. You realize that looking for a prospective house is useless if you have not yet been pre-approved of your mortgage.
This is often a common misconception and error for home seekers resulting to wastage of their time, effort and money. Yes it is a very good ordeal to start looking for a house, yet it is totally of no avail if you are looking in the wrong place at definitely the wrong time. You do not have the full and accurate picture of the things allowable in the home purchase in the first place, so how could you find the perfect property to consider for your investment?
If you have a loan pre-approval, you know the entire scenario and you know exactly what property you can realistically afford, basing on your mortgage loan and what type is granted you by your mortgage provider. Therefore, you can focus your time and efforts in trying to search for a property that is suitable and affordable with the kind of financial allocation you can actually spend. This is much less stressful and efficient compared to searching for random properties which you are not certain about their affordability and your eligibility to purchase. It saves you the disappointment knowing that you cannot realistically pay for it even if you have already fallen in love with the house.
Loan pre-approval is also a necessity if you are going to make the required home purchase offer. Say you have already seen the property of your choice and you are more than willing to make a proposition in initiating your transaction. However, the only problem there is that you do not have the pre-approved loan as evidence of your eligibility to carry on and complete the transaction. Home sellers prefer those who already have a stable and actual source of finances for the home purchase. It also gives them the notion that you are truly serious with your venture if you already have a pre-approved loan to use as their basis of accepting your offer.
Hence, before you embark on a home search endeavor, make sure that you have a loan pre-approval to avoid the hassle and bustle of uncertain offers and intangible sources of financial credibility. Prioritize that your loan be pre-approved by submitting all the requirements such as your employment history, monthly expenses and income, credit standings and scores among others.
Finding a house for the realization of your dreams is a fulfilling pursuit to begin with, however you need to make it as realistic as possible. Do this by securing a pre-approval for your loan and you can then enjoy this once-in-a-lifetime ride of your life.
The Real estate market can be an enjoyable, satisfying and lucrative experience for you.
article alley
This is often a common misconception and error for home seekers resulting to wastage of their time, effort and money. Yes it is a very good ordeal to start looking for a house, yet it is totally of no avail if you are looking in the wrong place at definitely the wrong time. You do not have the full and accurate picture of the things allowable in the home purchase in the first place, so how could you find the perfect property to consider for your investment?
If you have a loan pre-approval, you know the entire scenario and you know exactly what property you can realistically afford, basing on your mortgage loan and what type is granted you by your mortgage provider. Therefore, you can focus your time and efforts in trying to search for a property that is suitable and affordable with the kind of financial allocation you can actually spend. This is much less stressful and efficient compared to searching for random properties which you are not certain about their affordability and your eligibility to purchase. It saves you the disappointment knowing that you cannot realistically pay for it even if you have already fallen in love with the house.
Loan pre-approval is also a necessity if you are going to make the required home purchase offer. Say you have already seen the property of your choice and you are more than willing to make a proposition in initiating your transaction. However, the only problem there is that you do not have the pre-approved loan as evidence of your eligibility to carry on and complete the transaction. Home sellers prefer those who already have a stable and actual source of finances for the home purchase. It also gives them the notion that you are truly serious with your venture if you already have a pre-approved loan to use as their basis of accepting your offer.
Hence, before you embark on a home search endeavor, make sure that you have a loan pre-approval to avoid the hassle and bustle of uncertain offers and intangible sources of financial credibility. Prioritize that your loan be pre-approved by submitting all the requirements such as your employment history, monthly expenses and income, credit standings and scores among others.
Finding a house for the realization of your dreams is a fulfilling pursuit to begin with, however you need to make it as realistic as possible. Do this by securing a pre-approval for your loan and you can then enjoy this once-in-a-lifetime ride of your life.
The Real estate market can be an enjoyable, satisfying and lucrative experience for you.
article alley
Wednesday, October 14, 2009
Tips on Making an Offer to Purchase Real Estate
Tips on Making a House Offer
When you’ve done shopping around for a new house, you and your family has finally decided on one that is perfect for your family. It is now time to make an offer for that house. The offer you can give on a home can be quite tricky since you do not want to offend the seller by offering a very low price on it and you do not want to pay too much as well just to get that home of your dreams..
Below are some tips to help you make an offer to the home you are willing to buy and own.
1. Ask the advice of a real estate agent or even friends and family who are very knowledgeable in these matters. An agent is not supposed to recommend an asking price for a home but the information he or she can give you will help you a lot on what to offer the seller. An agent especially, has a lot of knowledge when it comes to homes in the market.
2. Find out the history of the home you are interested in. You can find out if the seller has bought it in a down market. More or less you will be able to pay the same price or near to the price your seller bought it for. This can help you to determine a good price for the home.
3. It is helpful to check out prices in the market. If you are in a seller’s market, the seller might not want to go lower than the list price. If you are in a buyer’s market, you might be able to talk the seller into the price you are willing to offer for the house.
4. Try to compare houses that have more or less similar features to the house you wish to buy. This is one way of getting a better estimate of the price you can offer for the home. If you know the prices of other homes, then you can offer a reasonable price to offer the seller.
5. Make sure to set your limit. Do not go beyond your means just to get the house you want. If you think the price is too high for you and it may cause difficulty later on in paying it off, explain to the seller your offer and try to see if he or she is willing to accept it.
7. Some homeowners have emotional attachment to the home they are about to leave. You may be able to get a deal in your favor if you tell them that you love their home and you are very much interested in buying it. Sellers might prefer to sell a house to a buyer who empathize with them. Be careful in doing so because some seller might take advantage and will demand for a very high price for the house.
8. Do not hesitate to negotiate money off the asking price. If the home survey reveals some faults or damages in the home that might need repairs and your money put into it, consider this when you offer a price to the seller.
With this information, you can start to narrow down your asking price options and hopefully will lead you to a decision. This way you and your family can have the house of your dreams soon!
Source
articlealley
When you’ve done shopping around for a new house, you and your family has finally decided on one that is perfect for your family. It is now time to make an offer for that house. The offer you can give on a home can be quite tricky since you do not want to offend the seller by offering a very low price on it and you do not want to pay too much as well just to get that home of your dreams..
Below are some tips to help you make an offer to the home you are willing to buy and own.
1. Ask the advice of a real estate agent or even friends and family who are very knowledgeable in these matters. An agent is not supposed to recommend an asking price for a home but the information he or she can give you will help you a lot on what to offer the seller. An agent especially, has a lot of knowledge when it comes to homes in the market.
2. Find out the history of the home you are interested in. You can find out if the seller has bought it in a down market. More or less you will be able to pay the same price or near to the price your seller bought it for. This can help you to determine a good price for the home.
3. It is helpful to check out prices in the market. If you are in a seller’s market, the seller might not want to go lower than the list price. If you are in a buyer’s market, you might be able to talk the seller into the price you are willing to offer for the house.
4. Try to compare houses that have more or less similar features to the house you wish to buy. This is one way of getting a better estimate of the price you can offer for the home. If you know the prices of other homes, then you can offer a reasonable price to offer the seller.
5. Make sure to set your limit. Do not go beyond your means just to get the house you want. If you think the price is too high for you and it may cause difficulty later on in paying it off, explain to the seller your offer and try to see if he or she is willing to accept it.
7. Some homeowners have emotional attachment to the home they are about to leave. You may be able to get a deal in your favor if you tell them that you love their home and you are very much interested in buying it. Sellers might prefer to sell a house to a buyer who empathize with them. Be careful in doing so because some seller might take advantage and will demand for a very high price for the house.
8. Do not hesitate to negotiate money off the asking price. If the home survey reveals some faults or damages in the home that might need repairs and your money put into it, consider this when you offer a price to the seller.
With this information, you can start to narrow down your asking price options and hopefully will lead you to a decision. This way you and your family can have the house of your dreams soon!
Source
articlealley
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