Common Seller Mistakes That Will Result In An Unsold Home

With the higher mortgage rates have come the initial steps of a shift in the real estate market .  Whereas sellers found selling homes to be a rather easy process with multiple buyer offers in the recent past, that has changed.  Buyers are being pickier with homes and some buyers have decided to wait until home prices or mortgage rates come down.  Sellers need to be on top of their game when selling a home to make sure they sell quickly.  Some of the mistakes noted below are things that can be avoided when listing a home for sale.

Over Pricing

Pricing a home is both a factor of recent home sales and the current mortgage rates.  Home sellers need to understand that higher rates mean buyers need to shop in lower price ranges than prior.  When rates were low a buyer could afford a more expensive home since the monthly payments were also lower.  As mortgage rates have moved up so have the monthly mortgage payment.  A $400,000 dollar house purchased at a 3% mortgage rates results in a $1517.77 a month mortgage payment (assuming 10% down payment and not including taxes or insurance).  At 6.5% that same mortgage payment for the $400,000 house is $2275.44.  That represents an increase of $757.67 to the monthly mortgage payment!

A buyer who could afford the $400,000 at 3% mortgage interest rate now can find themselves priced out of the same house at a 6.5% mortgage rate.  If there are no buyers of a home at the 6.5% interest rate then that means the home is overpriced and in order to get it sold the seller will need to cut the price.  ...

Tips For Selling A Home In A Buyer’s Market

The real estate market in many locales around the US shifted rather quickly to a buyer’s market with the increase in mortgage interest rates.  As a result home sellers need to put in a lot more effort in order to make sure their home is sold.  Many buyers have stopped looking for a home due to lack of affordability as a result of higher mortgage rates.  With fewer buyers, home sellers need to provide exactly what those buyers who are still in the market want.  Learn what home sellers need to do to get sold in this buyer’s market.

Get Pricing Right and Be Flexible

Pricing is one of the most important things to get right and work on getting right if it is not where it should be.  Buyers look for homes that will fit their monthly budget.  An overpriced house will mean buyers will walk away and look to homes that are priced within their range.  An overpriced home will get little love from buyers.  How a home was priced last year in a seller’s market should not control how a home is priced today.  Home sales comparisons (comps) need to be very recent.

Home sellers need to be flexible with their price.  Once listed the home price should not be set in stone.  As buyer feedback comes in the home seller needs to keep in mind what buyers are saying.  If buyers are mentioning home condition, need of updates, or some other reason that is usually a sign that the price may be high.  If the home seller does not want to make updates, change appliances,...

What Higher Mortgage Interest Rates Mean For Sellers?

Mortgage interest rates are at 14-year highs as of the writing of this article.  For many buyers that means the monthly payments are too high for their budgets to handle based on current home pricing.  With this market shift it means that buyers are now in control versus the past where the sellers called the shots.  With fewer buyers on the market the sellers need to figure out how to aim their home at the buyers who are ready to buy.

How Is A Mortgage Payment Calculated?

In most cases when home buyers are looking for a home, they are considering the amount they will be paying monthly for a particular home.  Monthly budgets by home buyer consider what they spend on car payments, food payments, utility bills, entertainment, and housing expenses.  Home buyers want to keep their expenditure outflows less than their income inflows in order to avoid racking up expensive debt.  Mortgage lenders calculate the pre-approval amount based on the debt-to-income ratio of the buyer to determine how much home they can afford.  So while a pre-approval letter may say a home buyer can buy up to a $500,000 home, the buyer will buy based on what the monthly payment of principal, interest, insurance and taxes will be and how that payment fits within their budget.

A $500,000 mortgage with a 3% interest rate and 20% down payment results in a $1686 dollar a month payment not including taxes and insurance.  With that same $500,000 mortgage, 20% down and a 7% interest rate the payment is $2661 without taxes and...

When Should You Reduce The Price Of A Home Listed For Sale?

When the real estate market is trending up due to being a seller’s market price reductions may not be needed.  In a neutral or buyer’s market price reductions will be what helps a home get sold when there is little to no activity.  There are always homes being bought and sold.  When a home is not selling there are a number of reasons why and price is usually at the top of that list.  This article looks at some of the common signals which home sellers should use as feedback to reduce the price on their home.

No Buyers/Been on the Market Too Long

A lack of any buyer coming through to tour the home could point to a pricing issue.  Active buyers will be shopping for home in their price range.  As mortgage interest rates have trended up over the last few months that means buyers have to look at lower cost homes in order to get the payment that works for them.  If a homeowner really needs to sell their home they need to make sure their price is realistic and priced according to what other similar homes sold for recently in the past.   

The problem with recent home sales in a downward trending market is that the most recent sales may have been at a time when mortgage rates were lower or there was still strong buyer interest.  Sometimes the seller’s market can flip very quickly to a buyer’s market without much notice.  Sellers...

Tips For Understanding The Listing Contract When Putting Your Home Up For Sale

When working with a real estate agent for listing a home for sale (or even commercial real estate) the agent will present the owner with a listing agreement.  The listing contract provides the terms and conditions the real estate agent will use to list the home for sale on the local MLS (Multiple Listing Service) where all homes are listed by agents.  Understanding the listing contract is important for homeowners since the contract will contain the rights each party has in the transaction.  This article looks at some of the important areas homeowners need to be paying attention to in the listing contract.

Basic Terms of the Listing Contract

Some of the important basic terms of the contract relate to things like making sure the correct address shown, understanding how long is the listing agreement for, and is the agreed upon commission rate correctly captured in the contract?  Typos happen and while not a huge deal if the house is listed as 1234 Main Street when it should be 1233 Main Street, a commission rate of 8 percent when 5 percent was agreed upon could become a costly error if the contract is ever enforced in court.  Just as with any contract everyone signing the contract should be reading the language and making sure they understand what they are signing.  If there are questions, ask your real estate agent or get an attorney involved if there is some language in the contract that is not understood.

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When Is The Best Time For Listing A Home For Sale?

In every real estate market there are particular times of the year during which the most buying and selling activity takes place.  During the peak selling season the most home buyers are out and about looking for homes to buy.  Sellers can take advantage of this peak selling time by making sure their homes are ready to go and get listed for sale with the best possible marketing.  This article explores when are ideal times to list a home for sale and provides some tips to get the home in great selling shape.

Peak Selling Time

As every market is different it is helpful to consult with a local real estate expert to determine when the peak selling time is for your market.  In Cincinnati the peak time when the most homes are sold is the month of June.  By sold that means the house purchase transaction closed and the new owner took ownership.  Generally, it takes around 30 days to get a home sold from when an offer is first accepted to the date of closing.  So in order to be part of that group whose home is sold in June the home must be on the market at least 30-60 days prior to that.

Once an offer on a home is accepted that only begins the process of actually buying a home.  Home buyers need to perform inspections, get the home appraised, work on applying for the mortgage and more.  Through this process the home buyer needs to rely on their team which usually consists of a real estate agent, home inspector, mortgage lender, appraiser, and sometimes contractors.  As can be...

Tips For Selling Your Home In Winter

Real estate is one of those things that sell year-round.  Regardless if it is in the dead of winter or during the hot summer months people will buy and sell homes.  Real estate does have its cycles where certain times there are more homes for sale and more buyers ready to buy.  Other times, like winter, there are fewer buyers and fewer homes for sale.  For those wanting to sell their home in the winter that means fewer sellers to compete with and buyers who are more serious about buying.  This article provides tips for home sellers to make sure their home shines for the buyers who are out looking to buy.

Interior and Exterior Preparation Tips

Interior Preparation

If a home hasn’t had a coat of fresh paint in the last few years making sure the rooms are painted with a neutral color will help when it comes to showings.  A majority of home buyers these days are looking for move in ready homes.  Old and worn paint or paint that is unique to a certain decorating style can limit the buyer pool who is interested in making an offer.  With an already smaller than usual buyer pool it makes sense to have colors that are neutral and appealing to all to increase the chances of getting strong offers.

The interior of the home should present well overall.  That means having clean windows, clean carpets/flooring as well as clean appliances.  Old worn carpets are a definite turn off to buyers.  Rough and faded hardwood floors do not convey a move in ready vibe.  Replacing carpets where a simple steam cleaning...

10 Smart Tips For Getting A Home Ready For Sale

With every home there are different factors that need to be taken account of due to age of the home, the current condition, and what sorts of updates if any were done as part of the consideration for putting it up for sale.  When getting a home ready for sale, each homeowner must approach their home as that of a neutral buyer looking for their next home.  A homeowner who loves their current home as-is is not doing themselves any favors by thinking everyone else will think the same.  Today’s buyers want market priced homes that are in move in ready condition.  This article looks at some of the ways home sellers can make sure their home is ready for buyers prior to putting it up for sale.                              

1. PROPER HOME PRICING

Pricing your home according to Cadillac standards when all your neighbors own Chevy homes will lead to failure.  That kind of pricing strategy usually does not work.  Even if your home does have Cadillac features compared to everyone else in your neighborhood that does not mean buyers are ready to pay the Cadillac price in a Chevy neighborhood when one street over they get a Cadillac home in a Cadillac Neighborhood.  Buyers want to buy homes where other homes in the neighborhood can support the value of the home they are considering.  So if the pricing of your home is out of line with that of your neighbors the chances of it selling are reduced.  

2. CURB APPEAL

Curb appeal is another thing...

Where Should A Home Be Listed For Sale?

When putting a home on the market for sale one of the important aspects is to make sure it gets widespread attention on the internet and that it be accessible to home buyers who are looking in the area to make a purchase.  The best way to do this is to have the home listed with a local qualified real estate agent who will list it within their local Multiple Listing Service (MLS).  The MLS then shares that listing with many other websites (Realtor.com, Zillow, Trulia, and others) that list homes for sale.  The key aspect to pay attention to is that the real estate agent is local to the property and is a member of the local MLS.  This article looks at how home sales can face setbacks when they are not listed in the proper MLS.

Why The Local MLS Matters

When talking about the local MLS what that is referring to is the MLS associated with the area where the property is located in.  A listing in Cincinnati, Ohio should be listed in the Cincinnati MLS as that is where Cincinnati real estate agents are also working to help their buyers and sellers.  Listing a Cincinnati property in the California MLS makes little sense at all.  While the property will appear in national websites that get MLS listings from all over the US they will not be shown in local websites that have only the local MLS feed.  

The example of a home located in Cincinnati being listed only in the California MLS is an extreme example and unlikely to happen.  What sometimes does happen though is that agents in the MLS the next region over are listing homes in their MLS rather than the local MLS since they don’t want to pay extra for the local MLS dues.  The main problem with this is the local MLS has no...

Tips For Selling A Home During A Pandemic

Due to the COVID-19 virus selling a home during a pandemic while a little more challenging is still possible.  Homeowners need to protect their own health and the health of buyers while having showings.  Some homeowners are using virtual showing technologies, many markets are restricting showings to no more than one buyer group at a time and shorter overall showings.  Things like providing sanitizer, masks, gloves and more are more common in homes that are on the market and allowing in person showings.  This article explores what home sellers need to be doing to ensure a successful home sale during the COVID-19 pandemic.

The Common Home Selling Advice

This advice bears repeating since it is important for home sellers to have their home put its best foot forward when it comes to getting buyer attention.  Anything less can result in a home sitting with little attention from buyers and needing steep price cuts in order to get sold.  Regardless of the current state of the economy there will always be a need for people to buy and sell homes.  With internet access available at the touch of a few screens on a smart phone, buyers are savvier than ever when it comes to knowing about the price in relation to the value of a home.

Buyers will not overpay for a home and overpricing a home is a surefire to prevent a home from getting sold.  Pricing is based on more than just what one paid for the home in the past...

Options To Consider When A Home Won’t Sell

Selling a home requires the right preparation, right pricing and marketing to help get it sold.  Sometimes depending on the market or the seller’s requirement to sell at a certain price a home just may not get sold.  For example during the initial COVID related lockdowns many homeowners pulled their homes off of the market and those that stayed on the market saw their showing requests drop rapidly.  This article explores what homeowners can do when a home is not selling.

Take A Break

Sometimes there is a wrong time to have a house on the market and the COVID shutdowns can be a perfect example of when may not be the best time to try and sell one’s home.  Many home buyers concerned about the risks of the virus decided to stay home and not look at all.  Some home buyer’s also were temporarily out of work and highly concerned about whether they would get their jobs back once the lockdowns did end.  The result was there were not enough buyers ready to buy and unless a homeowner was selling their house for the bottom dollar the chance of getting an offer was greatly reduced.

Other times when real estate buyer traffic slows down includes the holiday season at the end of the year and during the summer break when many families are away on vacation.  These times also reflect a slow-down in general when fewer homes are selling.  If a homeowner is getting very little interest during these times it may be advisable to pull the home off of the market until the market is back in the full swing of things.

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Selling A Home While Going Through A Divorce

Whether this is a change that is for the better or there are still some issues to be worked out selling a home during a divorce can be challenging.  A home sale transaction is easier when all parties are cooperative with the sale, meaning the buyers and each of the sellers.  In a divorce situation that can be a little difficult especially if one spouse is still holding on or wishes to take an approach that is confrontational.  Whether the desire is to sell the home or for one party to keep it there are some considerations that need to be made and this article explores.

Deciding To Keep The Home

One of the primary deciding factors for keeping a home during a divorce is whether the spouse who will keep the home can continue to afford to pay for it.  If neither spouse can afford to keep the home independently then the answer is to sell the home.  Whichever spouse plans on keeping the home that decision must be made mutually or decided in court via attorneys.

The potential problem that comes when one spouse wishes to keep the home is that both spouses stay on the mortgage even after divorce.  While a divorce agreement can specify who keeps the home and who is responsible for paying for the home the lender can still look to both former spouses if payments are stopped and the credit score of the spouse who no longer is living in the home will be effected as well.  The deed which shows ownership of the home is easily changed when both parties agree to sign the document changing ownership but that does not work for the mortgage.  The spouse who will keep ownership of the home can ...

Should You Sell Your Home To An iBuyer?

Many might be wondering what exactly is an iBuyer in the first place as most companies that offer the service don’t call themselves iBuyer by default.  iBuyer basically is a service provided by large real estate companies that seek to buy homes directly from the homeowner.  These companies imply they are making it easier for homeowners to sell their home without all the need for home preparation, marketing and whatnot.  While selling to an iBuyer may indeed be easier and quicker it does not come without a cost as this article explores.

What Is An iBuyer?

As noted above an iBuyer is usually a large corporation that is looking to buy homes to fix them up and then sell the house for a profit after repairs and updates have been made.  Some of the companies operating as iBuyers include Opendoor, Zillow Offers, Redfin and others.  The reason for the iBuyer name is that it is internet based like other products that add the extra i to their product name.  Most of these companies are using a computer generated algorithm to determine the price of a home and some might be familiar with the Zestimate that Zillow puts out for homes on their websites.  The computer generated number is just that, a number based on computerized data collected from recent sales around where a particular home is.  Those numbers are not always accurate and can leave homeowners confused with their over and underpricing.

iBuyers should be not confused with wholesale real estate investors (We Buy Homes For Cash type investors) who are usually local...

Marketing Remarks To Help A Home Sell

Marketing remarks are key to helping get a home sold.  While the pictures draw the buyer in the marketing remarks need to add to the whole marketing pictures so that the buyers want to take the next step and see the home in person.  With more buyers touring a home that means there will be a greater likelihood of getting a strong offer.  There are also marketing terms to avoid as they can turn away buyers who might otherwise be interested in the property.  This article looks at what kinds of marketing remarks work for home sellers and what language to avoid.

What Should The Marketing Remarks Tell About A Home?

Whereas the pictures of a home can convey a thousand words the words from those photos still cannot convey everything.  That is where the marketing remarks come in.  The marketing remarks are a chance to tell potential home buyers about those things not readily seen in pictures.  Have there been updates to parts of the home?  Then mention that.  Talk about the charm, the architecture and unique things of a home that will attract the buyer’s attention.  The pictures of the backyard may show the trees but do they really show the forest and the wildlife to the nature lover?  If not that is where the marketing remarks can add to the image.

Sellers should be using descriptive words that convey the openness of a house, the bright rooms and modern updates as applicable.  Where the photos give a visual description the marketing language needs to provide a verbal description about the things that are fun and interesting about the home.  If a home has a great kitchen and living area that makes for great parties the buyers should be told that the...

What Must You Disclose When Selling A Home?

Many states require the home seller to fill in a property disclosure form to help buyers understand the condition of a home.  Lack of disclosures or intentional non-disclosure of material facts can lead to lawsuits and in the extreme can even lead to the home seller being forced to buy the home back from the buyer.  So what exactly must a homeowner disclose to buyers on a home disclosure form and what are the consequences for a lack of disclosure?  This article explores the answer to those questions below.

What Is A Residential Property Disclosure Form?

Most states offer some sort of standard residential home disclosure form.  In that form homeowners are able to make note about the condition of things in their home like the roof, foundation, water issues, mold issues, who supplies the water, how is waste water handled, the HVAC system and more.  The disclosure form is sort of like a biographical disclosure of a home listing out the condition on all the important aspects of a home that a buyer would like to know about.  Many home inspectors will review the residential disclosure form to give them an idea of any potential areas they should focus on while inspecting.  

Who Has To Fill Out The Disclosure Form?

While every state has their own laws (and their own forms) on who should be filling out the disclosure form when selling a home there are some general rules that can apply.  If the home seller has lived in the home and is currently living in the home they should be filling out the disclosure form.  If the home seller lived in the home in the past but now no longer lives in the...

For this podcast Home Staging And Selling Your Home I sat down with Jo Potvin, Owner of Design To Market Home Staging. During our conversation we discussed home staging, quick staging tips, the benefits of home staging and more. This podcast is helpful for those about to sell a home who are wanting to learn about how to best position their home to sell.  The podcast was named one of the Top 5 Podcasts For Home Buyers by Investopedia.

I hope you enjoy the podcast and find it informative.  Please also consider sharing with those who may find it useful.

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About the author: The above Podcast “Podcast #7 Topic: Home...

Tips For Selling A Home As-Is

Selling a home as-is means the homeowner is not wanting to prepare the home for sale and usually that they will make no repairs for anything discovered during a home inspection.   There could be any number of reasons for selling a home as-is such as the home is an inherited home and the current owner does not have the time to get it sell ready, the homeowner may not have the financial means to prepare it or the homeowner prefers to let the buyer deal with updating the home.  Whatever the reason may be selling a home as-is can be done and this article takes a look at the best methods to do so.

Proper Pricing When Selling As-Is

When selling any home the price set for the home is a strong indicator of whether or not the home sale will be successful.  Overpricing a home is a sure fire way to make sure buyers steer clear of seeing the home and many will not even consider making an offer for fear they will be wasting their time.  It is even more important for the owner of a home being sold as-is to make sure their home is properly priced to reflect the amount of work that needs to be done.  Most home buyers are looking for move in ready homes and are ready to pay for that.  Those same home buyers may consider a home that is not move in ready providing that it is priced accordingly.

The as-is home can be bought using rehab mortgages that cover the purchase of the home as well as making repairs and updates to the home.  The home will still need to get inspected and appraised and the appraisal is where a sale can get tricky if it is overpriced.  Home...

Selling Your Home For Sale By Owner

Selling a home for sale by owner or FSBO means the homeowner is wanting to put their home on the market and try and find a buyer without the help of their own real estate agent.  Homeowners may be willing to work with an agent who brings a buyer or they may not instead preferring to work with a buyer who has no agent.  Oftentimes buyers who come with their own agent may already have an agreement in place to pay their agent so the seller does not need to be concerned with paying a commission on their side.  Whatever the reason may be for selling FBSO this article provides some tips and insights so homeowners can have a successful sale.

Preparation Is Important

Regardless of whether a homeowner is using a real estate agent or planning to sell for sale by owner getting a home properly prepared is critical.  A majority of home buyers are looking for homes that are move in ready.  A move in ready home is one where buyers don’t have to change carpet, don’t have to paint walls and may have to do as little cleaning as possible.  The best way to have a move in ready home is to use neutral paints on all walls, install new carpet and refinish hardwood floors with a modern color stain.  The instant buyers walk into the door of a home for sale is when they will start judging the quality of the home.  If walls are painted in bright non-traditional colors or the paint is worn and faded buyers may not be interested in what the home truly offers.

If the home requires repairs or updates those should be done prior to listing the home for sale.  Holes in walls, pet damage, windows that don’t open or won’t stay open, cracked windows, worn cabinets and more can all benefit...

Things To Consider Before Downsizing

Whether you are an empty nester looking to reduce your footprint or just don’t want a large house downsizing may be a great way to save money and be more stress free by not having to deal with the extra expenses.  Smaller homes can mean smaller mortgages and smaller utility bills. Depending on the new location too more opportunities may open up to live in an area that is more walkable or that may have close by shopping thus making the home more convenient.  Whatever the reasons or desires for downsizing homeowners need to consider a number of aspects to make sure the decision is right for them.

Declutter

When going from a larger house to a smaller house the first consideration to be made relates to how much stuff one will be taking to the smaller house.  Furniture, kitchen wares, decorations, and other household items can easily be downsized since a smaller house will not have the space for all those items a larger house does.  Before even listing the larger house for sale the homeowner should sell or giveaway those items that are not needed or will not fit in the new house. 

Heirloom items can be passed onto children or other relatives who can make better use of them. Money obtained from selling collectibles that others may not have the appreciation for can be put to better use by the homeowners themselves.  As many who are downsizing are also close to retiring if not already retired extra money in a bank account from selling off excess items can make a great travel fund or rainy day fund for future use.

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