| Q: |
Is a
low offer a good idea? |
| A:
|
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:
|
Appraised value 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. |
|
| 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.
The first step is to lower the 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).
Another option is to pull the home off the market and wait for
the market to improve.
Finally, frustrated sellers who have no equity and are forced to
sell because of a divorce or financial considerations could discuss
a short sale or a deed in lieu of a foreclosure with the mortgage
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. But
these would be considered more radical options than lowering the
price. |
|
| Q:
|
How is
the price set? |
| A:
|
It's very important to
price your home appropriately relative 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 comparative market analysis provides the background data on
which to base your list-price decision. Study the comparable sales
material presented to you by the different agents you interviewed
initially. If the analyses are more than two or three months old,
have your agent update the report for you.
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, there are several steps people can take
to make their 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 in the background also
will help set your stage. |
|
| Q:
|
What
are the standard ways of finding out what a house is valued at?
|
| A:
|
A comparative market
analysis and an appraisal are the standard ways consumers, lenders
and realty agents determined what a home is worth.
Your real estate agent will be happy to provide a comparative
market analysis, an informal estimate of value based on comparable
sales in the neighborhood. You also can research "the comps"
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 the
price tag put on a house in a real estate listing; it usually is
only an estimate of what the 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.
A seller 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:
|
Even in a down market,
real estate experts say price and condition are the two most
important factors in selling a home. So, the first step is to lower
the price. Also, go through the house and see if there are cosmetic
defects that you missed and can be repaired.
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 local multiple
listing service.
If the seller is using a real estate agent and the property isn't
getting proper exposure, find another agent.
|
|
| Q:
|
Where
do I get information on housing market stats? |
| A:
|
A 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 regularly
publishes quarterly reports on home building and home buying. Your
local builders association probably gets this report. If not, the
housing research firm is located in Canton, Mich.; call (800)
755-6269 for information; the firm also maintains an Internet site.
Finally, check with the U.S. Bureau of the Census in Washington,
D.C.; (301) 495-4700. The census bureau also maintains a site on the
Internet. The Chicago Title company also has published a pamphlet,
"Who's Buying Homes in America." Write Chicago Title and Trust
Family of Title Insurers, 171 North Clark St., Chicago, IL
60601-3294. |
|
| 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. |
|
