| 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
backgroun 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
deterimined 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 traditionlly 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. |
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