You did all of your homework. You contacted a lender and you know your price limitations. You honed in your wants and needs, determined your desired locations to live. Your weapons sharpened you are ready for the hunt. Scouting is the next step. Not too long ago newspapers and magazines were your best choices to find a new house. Today the internet is king and by far the best place to start the search. Most folks sit in their home offices, usually at night, when the kids are asleep with a cup of coffee or a glass of their favorite Pinot in front of a computer screen clicking away on one site after another. There are many web sites to choose. Some of the more popular ones are, Trulia, Zillow, Homefinder and Realtor.com. All you must do is write in a location input the price range and a few other details and bam, a whole page of available houses appear. Seems so easy yet you must take care. Unfortunately, independent listing websites are not monitored for quality and on some of these sites; anyone can post a home for sale. The hunter may find the perfect abode only to discover the house sold two months ago or you may find a fictional abode. Some unscrupulous Realtors place false advertisements on these sites only to get your business, when you call the Realtor accompanying the listing for a showing, he or she will tell you “sorry it just sold; however I know a few like this one I can show you.” I have heard stories of Realtors placing a ‘for sale’ sign in front of their own homes they are not intending to sale and snapping a photo to place on the web to get business. Not all Realtors are like this; however, there are a few bad eggs. Not all web listings are bad; the prudent hunter needs to be aware of the pitfalls. Realtor.com is the best search website on the net. Realtor.com gains their information from the MLS (Multiple Listing Services) even so you must verify.
This is a good time to find a Realtor. A Realtor who is connected with the MLS can verify if the web listings are true. They can also set you up to receive fresh listings by email. A Realtor will take the information you gathered and place it in the MLS to limit the search to your criteria. The houses you receive are true with no worries of expired or fraudulent homes. A Realtor who misrepresents a listing on the MLS might be , or banished. If you are not ready to seek a Realtor, another good place to search is on brokerage sites. Some of the major brokerages in North Texas include, Prudential, Century Twenty-one, Keller-Williams to name a few. Most brokerages have reciprocity agreements with competing brokerages to display houses. The listings on brokerages sites feed directly from the MLS and are true. Craig’s List and the Green Sheet websites also advertise homes, however again be aware of fraudulent Sellers.
The internet is a powerful tool. Over 37% of hunters start the hunt searching on the internet. Another 38% start with a Real Estate Professional who also uses the internet. With so much information on houses at your fingertips, the hunter should have no problems scouting for the perfect castle. …See ya down the road. http://www.djlyons-realtor.com
No fooling this is the current market. Many Sellers are getting offers for full price, a growing number are receiving higher than listed offers, and homes are disappearing fast. In fact, average days on market are down 22.4% from last year. House hunters must be prepared. The first thing they need to do is to get a Pre-approval letter from their lender. In today’s market, the Buyer must be ready to pounce on the home they desire. When viewing the home, the house hunter must remember even if you think you toured the home first, chances are, you are wrong. When walking through a nice home, be assured, an offer is already in the works. The Buyer must be ready to pull the trigger and not have to wait around for a Pre-approval letter. The Buyer must also be aware of his obligations concerning escrow money and option period money. Escrow money guarantees the Buyer will show up to closing and usually runs $1,000 per $100,000 of offered price. The option money gives the Buyer a seven to ten-day option period, granting the Buyer freedom to bow out of the contract for any reason what so ever. After the option period then only a problem obtaining the loan or an act of God will allow you to opt out of the contract and obtain your escrow money. If you truly want to buy a home, be equipped for the hunt.
Prepare for multiple offer situations. What I mean is to be mentally ready for the possibility of missing the offer. Unfortunately, this is the market; you cannot get depressed or get in the dumps because you lost that perfect abode. It only means the hunt will last longer but do not despair, the right home is out there for you. This is also not the time to think you will be able to negotiate for a lower price. Negotiations are out the window. Think at the very best you could receive is list price. More than likely, you must offer above list price if you want to beat out the competition, especially for a very nice home. If you are searching for a home with the maximum price of $200,000 than look at homes in the $180,000 to $185,000 range to give you cushion to make an offer better than list price.
How much more must you go over list price? That is a loaded question. The Seller’s Realtor in the state of Texas cannot disclose the price of the highest offer to a Buyer’s Realtor. The only answer you will receive from the Seller’s Realtor “Is that your best offer?” What is a house hunter supposed to do? The sky is the limit to what you could offer however, it all depends on how you plan to purchase the home. If you are paying with cash no problem. If you are financing then you could have a problem with submitting high offers. With conventional loans, the Buyer must at a minimum place 5% down on the home. Those seeking a FHA loan are required to put a minimum of 3% down while those obtaining a VA loan are sometimes not required to place any money down for a down payment. If you find a home and are aggressive with the offer, you risk pushing the price higher than appraised value. The bank will take the appraisal plus the Buyer’s down payment. Add those two prices together and if the Buyer’s offer is higher than the final appraised price than the house hunter is in trouble. They will need either to cough up the additional funds or renegotiate with the Seller to accept a lower price for the home to meet the loan amount the bank will approve.
Homes are available, yet it is not as easy as it was only a year ago. Folks are hanging on to their homes as others are moving in to the area. Your Realtor must be persistent and knowledgeable with the market and north Texas neighborhoods. Purchasing a home in this market is a blood sport, be prepared! If you want more info, please do not hesitate to contact me at firstname.lastname@example.org or visit my website at http://www.djlyons-realtor.com .
Believe it or not, we are still in winter. It may not feel like winter, however February lies ahead and February is the time we get our worst weather in the north Texas area. Freezing temperatures can play havoc on a home if not prepared. Do not let our warm days fool you. You need to be ready at least until April to insure you are protected. Busted water pipes are a nightmare. Not only must you deal with the busted plumbing you need to repair the damage the water caused. Below are some tips to help getting you through this time of year and to help prevent costly damage.
Cover those outdoor faucets. Buy Styrofoam nozzle covers from Home Depot or Ace or any hardware type store. They are easy to install. Cover all exterior faucets. They will trap the indoor heat and keep the nozzles from freezing. Freezing water expands and splits piping. As the ice thaws then you have a mess. Nozzle covers are cheap insurance and well worth the money.
Drip your faucets. This applies to indoor faucets installed on exterior walls of your home. You do not need flowing water just a steady drip will work. Like a stream, water does not freeze on a moving current. Be sure to remember when the temperature rises above 32 degrees to turn those faucets off else you may be stuck with a large utility bill.
Do not turn off the heat. This may sound obvious. Nevertheless if you are selling your home and have moved out or you are going on an extended trip during the winter months it is not uncommon for the owner to turn off the utilities to save some cash. The plumbing in most north Texas homes runs across the attic. Heat rises and the warmth from the living spaces below keep the attic space above freezing. When the heat is turned off nothing is left to keep those pipes warm and they freeze. After you come back and turn everything on, ouch! A flooded home. I have heard horror stories of this happening before. You can turn down the heat but by all means do not turn the heat off.
Wrap pipes located at the eaves. If your plumbing is located near the eaves of the roof you may consider buying heated wraps. This is a good idea even if the heat is turned on. At the edge of the roof is space that is exposed to the outdoor temperature and heat from the home has a hard time reaching those areas.
If the weather is freezing it is always better to safe than sorry. Busted water pipes are no fun and can be very expensive. Keep your home protected. See ya down the road.
As the New Year begins the North Texas real estate market is on fire. Homes are selling yet we find ourselves in a bit of a conundrum. Our area is running low on listings. This is great news for Sellers. Less competition and the law of supply and demand, higher prices, make this a good time to place your house on the market. However there are some pitfalls Sellers need to consider before making that step. I have listed the top ten mistakes for Sellers to avoid when listing a home. Drum roll please:
10. Waiting until spring to list – True that spring is the traditional time to list a home. Many place their home on the market during springtime in anticipation of the summer crowds. Kids are out of school and there is enough in between time before it starts up again. Spring is a very popular time and that is the problem. Your home will have more competition on the market. You may have more showings however you will have the same amount of actual Buyers but an increase of those who are just looking, tire kickers I like to call them. During the off seasons, late summer, fall and winter the serious Buyers are shopping. Showings may be less but those showings are to clients that are truly ready to purchase, business re-locations also more prevalent in the first quarter of the year, increasing your odds of making a sell. Do not discount placing your home on the market during the off-season.
9. Ignoring minor upgrades – Your home was good enough for you why wouldn’t be good enough for someone else? Maybe it will, maybe it won’t. The problem is you are limiting your pool of potential Buyers. Some upgrades are inexpensive to do yet make your home much more marketable. For instance removing wall paper and painting a wall or replacing worn carpeting or repairing that broken water heater, minor upgrades can make all the difference. On the flip side do not overdo it. Make sure your upgrades are cost-effective. Don’t spend thousands to get hundreds in return. Sit down with your Realtor and go over any planned renovations to determine if it will add value to your home.
8. Understanding your offer and know your contract – Since an offer turns into a contract once it is accepted and signed by all parties I combined the two into one. If you understand the offer you will understand your contract. Read over the offer carefully, ask questions, have your Realtor explain all the ins and outs and who is responsible for paying what. Offers can be overwhelming, especially to those who are not in the business. Who pays for closing costs? Who pays for the title insurance? Who pays for the survey? Who buys the home warranty? And what repairs is the Buyer requesting? These are only a few of the questions that will come up with an offer. When you understand the offer you will understand the contract.
7. Do not be insulted by a low ball offer – Your home is your castle, the saying is true. You have done your homework, completed some minor upgrades and placed your home on the market then some low life makes you an offer for $20 grand less than your asking price. The nerve of them! Do not and I repeat, do not! Walk away. The Seller must understand that this is just the first salvo in the negotiation process. Everyone is looking for a bargain. Buyers will throw out the bait in hopes that you will accept it but they generally know that it is a long-shot. Some may not have the funds to purchase your home however that will come out during the back and forth of negotiations. Others have the funds but again are looking for that bargain basement price. If they are serious they will negotiate upward until both parties have reached a fair and equitable agreement. Make sure you have enough cushion in your price to negotiate.
6. Shorting your listing time – The standard listing time for a home on the market is 6 months. We are fortunate in North Texas to have a very healthy real estate market. The first month of a listing is usually spent fixing up the home, taking photos and preparing all of the marketing materials as well as setting up the multiple listing services. If your home is priced correctly it will sell quickly. Unfortunately many are not. Anything under six months is simply too short of a period to expect that your home would be sold. Sometimes it takes a while to convince the Seller that he is priced too high. Sometimes the competition in an area that is very strong and sometimes the marketability of the area is weak. However giving some time, the competition can dwindle and the marketability can increase and when a new wave of Buyers begin to look your home can become very desirable. This takes a spell and anything less than 6 months is too short to expect anything, plus it is unfair to the Realtor who has spent his time and money advertising and preparing for your home to be sold. If the Realtor does not have enough time to sell your home, he won’t get paid.
5. Going it alone without researching – You are a “for sale by owner” type. You want to go it alone but do you know what it takes? Have you realistically priced your home? Have you exhausted all avenues of marketing? Do you know what those avenues are? What about contracts? Do you feel comfortable reviewing them alone? Selling a home is a lot of work. If you want to venture down that path do your homework!
4. Don’t be chincy with your advertising or your Realtor – If you go it alone this lands on your shoulders, if not it falls to the Realtor. Make sure you know how the Realtor will market your home. Make sure he or she has access to the Multiple Listing Services. Make sure you are getting maximum exposure over the internet. The internet is a key element to selling your home. Print advertising in this day is not nearly as effective as the internet. Also do not undercut your Realtor on his/her commission. Many Sellers try but is really a bad deal. The standard listing rate is 6% of the sales price. 3% goes to the Buyer’s agent 3% to the Seller’s agent. Out of the 3% the listing Broker can take as much as 50% of the 3%. Now your Realtor has five homes he/she is listing and you want them to cut 1% from their 1.5% they are taking in. The Broker never takes the cut it is always the Realtor. How far up the totem pole do you thing they are going to place your home? How much time will they spend to advertise your home compared to the others that they are getting full price? Will they be giving you a 100%? If your employee cut your salary by ½, how eager would you be to please them?
3. Don’t ambush your showings – Nothing kills a potential offer then staying at home when a Realtor shows up with a Buyer. To understand you must get into the mind of a typical Buyer. When a Buyer walks through your home they are trying to get a mental picture of the home being their own. If the Seller is there to greet them, automatically the Buyer realizes that this home belongs to someone else thus eliminating that picture in their mind and that is a bad thing. They cannot talk openly about what they like or dislike, the showing is awkward and it is just uncomfortable for all parties. That is not what you want you’re potential Buyer to feel as they leave your home. Get out of the house when a showing is scheduled. Go to the store, drive around or go to your neighbor’s home but you need to get out.
2. Not staging your home to sell – Beyond upgrades, beyond repairs, your home must be ready to show. What do I mean by ready? Back to the mental picture, the Buyers need to imagine the home belongs to them. If you have personal photos hanging on the wall, if you have your well-worn comfy chair sitting in the corner, if your children’s toys are spewed across a room, that picture in the Buyer’s mind is shattered. They realize they are in another’s home and it is a turn off. Other factors are also in play. Is the home sloppy, does it smell bad or are there bugs flying around? All of these are turn offs and can leave a Buyer shaking their heads and wondering why they wasted their time looking. Realtors can help you with this process.
And drum roll please for the number one mistake a Seller can make.
1. Pricing your home above market value – Out of everything mentioned this is the main killer of a potential offer. If your home is priced too high you will not even get a showing, market value rules. Buyer’s searching for a home on the internet will simply pass over yours for one that is within their budget. Those with a higher budget will pass over your home because they can find homes with better amenities for a better price. Thus no showings and no sell. If your home is moderately overpriced then you will get showings however you will not get offers. Both conditions can be rectified. A Realtor can perform a market analysis (comp) on your home comparing similar homes that have sold in your area and what the market price beared. When that price is determined then you add in for negotiations, closing costs and repairs. When you get an offer than you can start negotiations, price is everything.
See ya down the road!
The maverick spirit runs deep in Texas. This is what tempts a seller to sell his home on his own. Why use a Realtor? Why pay the commission? I can do this on my own….really???? I’m not trying to be glib. There are those who can actually sell their own home without a Realtor but that is not easy, not easy at all. The first thing a FSBO (for sale by owner) type needs to realize is they are only saving 3% on the commission. If you want a buyer’s Realtor to show your home you must offer them the standard rate of 3%, else no telephone calls for showings. The average seller also has no access to the MLS (Multiple Listings Service). MLS is perhaps the most powerful tool a Realtor uses. The MLS gives the Realtor access to homes for sale, for lease or homes sold. Every Realtor searches the MLS for the homes they will show their buyer.
The internet is also a great tool. The common FSBO will usually get on one or two of the most popular real estate websites like Trulia or Zillow but there are many other opportunities on the web then just those two sites. Many of the major Real Estate brokerages such as Prudential, Century 21, Ebby Holiday and others have access to many more websites plus with reciprocity agreements, properties listed with one broker not only appear on their own website but on the competition’s website, increasing exposure. When selling a property both price and exposure are the two most important aspects. Not only is the FSBO at a big disadvantage when it comes to advertising but does the seller have enough time in the day to stop what they are doing to show a home. Buyers want to look at homes when they want to look at homes and that might not fit your schedule. Don’t get me wrong. I’m not trying to crush the maverick spirit but the seller should know what he is up against. Add in services such as professional photography, home staging plus experience with negotiations and contracts makes a Realtor hard to beat. The 3% savings can easily be made up with the increased sales price a Realtor can get for you.
The price of your home is another major factor. Owners have a hard time pricing their own homes because they are too close. What I mean is the difficulty for them to perceive their home from an objective point of view. The home might be their very first home they purchased after marriage, maybe they raised their children in the home. This is the home they lived in for most of their life, of course it must be worth $350,000. Unfortunately the market does not see your home the same way. Market value is market value and the buyer has seen many houses before they get to your home and they are aware of the market value. A Realtor can do a comprehensive market analysis to give you an accurate price. I know it is heart breaking to find the home you value at $350,000 is only worth $250,000 but would you rather sell the home or watch it linger for sale with few showings?
So next time you think you should sell your home on your own, think it over for a while. Possibly you are the maverick who can sell on your own, but let me tell you, there is no shame in seeking help.