While
your low offer in a normal market might
be rejected immediately, in a buyer's market
a motivated seller will either accept or
make a counteroffer.
Full-price
offers or above are more likely to be
accepted by the seller. But there are
other considerations involved:
* Is the offer contingent upon anything,
such as the sale of the buyer's current
house? If so, a low offer, even at full
price, may not be as attractive as an
offer without that condition.
* Is the offer made on the house as is,
or does the buyer want the seller to make
some repairs or lower the price instead?
* Is the offer all cash, meaning the buyer
has waived the financing contingency?
If so, then an offer at less than the
asking price may be more attractive to
the seller than a full-price offer with
a financing contingency.
Q:
What
is the difference between market value and
appraised value?
A:
The
appraised value of a house is a certified
appraiser's opinion of the worth of a
home at a given point in time. Lenders
require appraisals as part of the loan
application process; fees range from $200
to $300.
Market value is what price the house will
bring at a given point in time. A comparative
market analysis is an informal estimate
of market value, based on sales of comparable
properties, performed by a real estate
agent or broker. Either an appraisal or
a comparative market analysis is the most
accurate way to determine what your home
is worth.
Q:
How
does someone sell a slow mover?
A:
Even
in a down market, real estate experts say
that price and condition are the two most
important factors in selling a home.
If you are selling in a slow market,
your first step would be to lower your
price. Also, go through the house and
see if there are cosmetic defects that
you missed and can be repaired.
Secondly, home sellers should make sure
that the home is getting the exposure
it deserves through open houses, broker
open houses, advertising, good signage
and a listing on the multiple listing
service (MLS) and on the Internet.
Another option is to pull the home off
the market and wait for the market to
improve.
Finally, if you who have no equity in
the house, and are forced to sell because
of a divorce or financial considerations,
you could discuss a short sale or a deed-in-lieu-of-
foreclosure with your lender. A short
sale is when the seller finds a buyer
for a price that is below the mortgage
amount and negotiates the difference with
the lender.
In
a deed-in-lieu-of-foreclosure situation,
the lender agrees to take the house back
without instituting foreclosure proceedings.
The latter are radical options. Your simplest,
and in many cases most effective, option
is to lower the price.
Q:
How
is the price set?
A:
It's
very important to price your home according
to current market conditions. Because
the real estate market is continually
changing, and market fluctuations have
an effect on property values, it's imperative
to select your list price based on the
most recent comparable sales in your neighborhood.
A so-called comparative market analysis
provides the background data upon which
to base your list-price decision. When
you prepare to sell and are interviewing
agents, study each agent's comparable
sales report (the data should be no more
than three months old).
If
all agents agreed on a price range for
your home, go with the consensus. Watch
out for an agent whose opinion of value
is considerably higher than the others.
Q:
How
do you prepare a house to sell?
A:
Doing whatever you can to put your house's
best face forward is very important if you
want to get close to your asking price or
sell as quickly as possible. Short of spending
a lot of money, here are several ideas for
making your home show better:
* Sweep the sidewalk, mow the lawn, prune
the bushes, weed the garden and clean debris
from the yard.
* Clean the windows (both inside and out)
and make sure the paint is not chipped or
flaking. And speaking of paint, if your
home was built before 1978, new federal
law gives a buyer the right to request a
lead inspection. If you think you might
have some problems, do the inspection yourself
beforehand and make any fixes you can.
* Be sure that the doorbell works.
* Clean and spruce up all rooms, furnishings,
floors, walls and ceilings. It's especially
important that the bathroom and kitchen
are spotless.
* Organize closets.
* Make sure the basic appliances and fixtures
work. Get rid of leaky faucets and frayed
cords.
* Make sure the house smells good: from
an apple pie, cookies baking or spaghetti
sauce simmering on the stove. Hide the kitty
litter.
* Put vases of fresh flowers throughout
the house.
* Having pleasant background music playing
also will help set your stage.
Q:
What are the standard ways of finding out
how much a home is worth?
A:
A
comparative market analysis and an appraisal
are the standard ways consumers, lenders
and realty agents determined what a home
is worth.
Your HomeJoy Real Estate agent will be
happy to provide a comparative market
analysis, an informal estimate of value
based on comparable sales in the neighborhood.
Be sure you get listing prices of current
homes on the market as well as those that
have sold. You also can research this
yourself by checking on recent sales in
public records. Be sure that you are researching
properties that are similar in size, construction
and location. This information is not
only available at your local recorder's
or assessor's office but also through
private companies and on the Internet.
An
appraisal, which generally cost $200 to
$300 to perform, is a certified appraiser's
opinion of the value of a home at any
given time. Appraisers review numerous
factors including recent comparable sales,
location, square footage and construction
quality.
Q:
What
is the difference between list and sales
prices?
A:
The list price
is how much a house is advertised for
and is usually only an estimate of what
a seller would like to get for the property.
The sales price is the amount a property
actually sells for. It may be the same
as the listing price, or higher or lower,
depending on how accurately the property
was originally priced and on market conditions.
If
you are a seller, you may need to adjust
the listing price if there have been no
offers within the first few months of
the property's listing period.
Q:
What
is the best time to buy?
A:
Because
many buyers prefer to move in the spring
or summer, the market starts to heat up
as early as February. Families with children
are anxious to buy so they can move during
summer vacation, before the new school year
begins.
The
market slows down in late summer before
picking up again briefly in the fall.
November and December have traditionally
been slow months, although some astute
buyers look for bargains during this period.
Q:
What
are the two most important factors when
selling a home?
A:
Price and condition are the two
most important factors in selling a home,
even in a down market. The first step
is to price your home correctly. Use comparative
sales information from your HomeJoy agent,
or pay for a professional appraiser (usually
$200 to $300), to objectively evaluate
your home's worth. Second, go through
the house and repair any obvious cosmetic
defects that could deter a buyer.
In a down market, you may have to consider
lowering your price and/or making a major
repair, such as replacing the roof, in
order to lure a buyer. Also, make sure
that your home is getting the exposure
it deserves through open houses, broker
open houses, advertising, good signage
and a listing on the local multiple listing
service or online listings provider.
If this isn't happening, take it up with
your agent or agent's broker. If you are
still not satisfied you are getting the
service you need, you may have to switch
agents.
Q:
Where
do I get information on housing market stats?
A:
Your
HomeJoy Real Estate agent is a good source
for finding out the status of the local
housing market. So is your statewide association
of Realtors, most of which are continuously
compiling such statistics from local real
estate boards.
For
overall housing statistics, U.S.
Housing Markets, (MeyersGroup.com) regularly
publishes quarterly reports on home building
and home buying. Your local builders association
probably gets this report. Finally, check
with the U.S.
Bureau of the Census in Washington,
D.C.; (301) 763-3199; census.gov.
The Chicago Title company also has published
a pamphlet, "Who's Buying Homes in
America." Write Chicago Title 601
Riverside Ave., Jacksonville, FL 32204;
(888) 934-3354; ctic.com.
Q:
What
is the difference between list price, sales
price and appraised value?
A:
The
list price is a seller's advertised price,
a figure that usually is only a rough estimate
of what the seller wants to get. Sellers
can price high, low or close to what they
hope to get. To judge whether the list price
is a fair one, be sure to consult comparable
sales prices in the area.
The sales price is the amount of money
you as a buyer would pay for a property.
The
appraisal value is a certified appraiser's
estimate of the worth of a property, and
is based on comparable sales, the condition
of the property and numerous other factors.
