Sellers

Determining the price of your home is crucial to the sale. Wrong pricing could either cause your house to stay longer in the market or could mean getting less from the actual value of your home. This is why sellers opt to pay $300 to $400 to have their homes appraised before putting it on the market, says Alan Hummel, past president of the Appraisal Institute and chief appraiser for St. Paul, Minn.-based Forsythe Appraisals LLC. He said presale consultations in their firm increased in the first quarter while the real estate market for residential properties slowed down and properties in the market increased.

Real estate agents can also do the appraisal for you. But going to an appraiser will give a more accurate and unbiased assessment. Usually, agents also turn to appraisers or suggest this to this clients especially if the house has stayed in the market for quite some time.

The appreciation for a more accurate pricing came just a few years ago. Gone are the days when you can just quote a price and see how it goes. “Now you’ve got to be competitive and you have to know that the offers coming in are reasonable,” Hummel said.

He adds, if a property spends too much time on the market, the price it will be able to command often decreases, some buyers will question the reasons for the property’s inability to sell.

An appraiser will assess your home from a objective view, based on several factors like its location and the condition of the house. “We’re trying to react the way a typical purchaser would,” he said. The appraisal also will analyze the health of the local real estate market, giving homeowners more personalized expectations for selling their home—a feature especially important with the plethora of national news stories generalizing the real estate market, Hummel pointed out.

Appraisers sometimes use a cost approach where they determine the price of the house by comparing it to a new house with similar specifications. This approach is beneficial to sellers with newer homes because this gives them an idea of where their home stands in the new-construction front.

It will also be a good idead to look for the appraisal report before you bought your home, says Michael H. Evans, president of Evans Appraisal Service Inc. in Chico, Calif., and a fellow of the American Society of Appraisers. According to him, only a few people actually take time to review the paperwork when it’s done. Most buyers are just focused on buying the house. “They don’t go back and review that paperwork unless there’s a significant issue that needs to be addressed,” says Evans.

But reading through the report can actually save you from problems. It’s also a good idea for sellers to address this before putting the house in the market.The American Society of Appraisers shares with us some things you should know about home appraisals.

The appraisal report includes the following information

• The appraisal. It will give details about the house, a description of the neighborhood and comparison with other similar properties in the area.
• Evaluation of the area’s real-estate market;
• Major damage or possible problems that will affect the value of the house;
• An estimate of the length of time that the house will stay in the market

An appraisal report versus a home inspection

An appraisal is an opinion of the value of the house. It compares your house with similar houses that were sold. A home inspection report on the other hand, is on the lookout for flaws and damages in the structure.

Securing a copy of the appraisal

It is your right under federal law to have a copy. When you bought your home you paid for an appraisal. If you don’t have a copy, you can ask for it from your lender.

What to look for in the report

Pay attention to items on the report that have a negative adjustment. Those are the things you’ll need to change or replace to get a good offer. It could be an outdated kitchen or bathroom; adding another bathroom; or adding more space in the garage to fit another car.

The value of getting an appraisal before entering the market

The appraisal will help you pruce your house more accurately. If a seller’s askig price is more than the actual value of the house, it will cause the house to stay long in the market, which will eventually force the seller to sell their home at a very low cost just so they could already sell it.  

• Do you work full time as a real estate agent? How long have you been working full time in this field? What professional associations do you have? By asking if they’re working full time allows you to determine how commited you can expect them to be in your transactions. The length of time they’ve spent on this field can give you confidence knowing that they know what they’re doing, but it is not guaranteed. And tenure does not guarantee a good service.
• Do you have an a staff or assistant? Or a team that can take care of the various parts of the process? What are their roles in the transaction? What are their names and contact information? Brokers usually work with other people to carry out all the necessary work and achieve a succesful transaction. The more clients they have, the more staff they’ll need to have. It’s okay to ask if you want to find out who are the people wotking with them and what their roles are. You could also ask questions like: To whom will I give the payment? Who will be there in closing?
• Do you have a website where properties for sale are listed? Can i have the web address? Does it have a hotline or customer service email? Who responds to them and how quickly are they handled? Being online does a lot to marketing. Most people turn to their internet when they look for something. It can give them a lot of information in their convenience. Try searching for your agent’s website and see how visible they are online.
• How often will you contact me? How will you contact me? Establish a communication system with your agent so you will have an idea on how often to expect to hear from them. And ask how they will contact you – by your home phone? mobile? email? So you can be ready for them.
• What sets you apart from other realtors? Is there something you do that other agents don’t that can give me the best deal for my home? Sometimes the key to selling a home in a short time is dependent on your agent’s research, marketing skills and delivery.
• Can you give me names of past clients? Selecting an agent is like hiring an employee. Asking about them from references can give you an idea of how they are in their profession.
• Do you have a performance guarantee? Can I terminate our listing agreement if I am not satisfied with your service? It can be difficult for an agent to offer a performance guarantee. But this does not mean they are not capable of providing a high quality service. The agent should however be able to tell you what you could expect from them.
• How will you get paid? How are your fees calculated? Can I have this in writing? In most cases, the seller has the responsibility of paying agent commissions. There may be other small fees, such as administrative or special service fees, that are charged to clients, regardless if they are the buyer or seller. Before you hire an agent, ask for an estimate of costs.
• How will you develop pricing strategies for our home? The price of a house is one of the major factors in selling it quickly. Current property information is important. Ask your realtor how they made the market analysis, and if they included For Sale by Owner homes, foreclosed homes and bank-owned sales in that list.
• In terms of advetising and marketing, what do you plan to do to sell my home? Who determines where and when my home is marketed? Who will pay for advertising? Ask your agent for a clear plan on how money for marketing and advertising will be spent. Ask for samples or case studies of the types of marketing strategies that your agent has in mind (such as Internet Websites, print magazines, open houses, and local publications).

If you’re thinking of selling your home, prep up your kitchen. Homebuyers put a premium on the kitchen. Families do a lot of things in the kitchen – preparing meals, sharing meals, sorting through bills, and just hanging out.

According to a recent survey by SieMatic Corp., 85% respondents said that the condition of a home’s kitchen is a major consideration when making a purchasing decision.

You don’t have to give your kitchen a major overhaul. There are other things you can do to make your kitchen look attractive without tearing it down.

Give it a fresh paint. Painting your kitchen new is one, inexpensive way to prep it up. Choose a neutral color since potential buyers have different preferences.

Give your countertops a fresh look. Take a good look at your countertop. Does it need new tiles? Find inexpensive ways to improve it. It won’t cost much especially if your counter is not big. In terms of the color, again, keep it neutral.

Update the faucets. Nowadays, there are so many faucets to choose from. You can pick a stylish faucet to add a pretty and modern touch to your kitchen.

• Take time to think about why you want to sell your home. It can be from a need to move to another place or you need to find a bigger home for your growing family. Ask yourself what you want to accomplish from this sale. As you think about this, you need to also define the time frame and profit margin that you have in mind. Discuss these goals with your real estate agent.
• Set your price. In setting the selling price, you need to be fair. You need to research on the selling price of comparable homes in your area as well as the real estate climate in your area. Most homeowners set a price based on the personal value of their home. Don’t make this same mistake. Take into consideration the condition of your house – the age, wear and tear, damage. It’s usually hard for sellers to set a realistic, unbiased price so you’ll need to consult your real estate agent. This is why it’s important that you find an agent you can trust. Your agent should be able to provide you with information about the selling price of comparable houses in your neighborhood and the average time they waited to be sold. You could also ask someone to do an appraisal on your house so you could have a second opinion and a more objective one. Setting a fair market value price on your house is important. Studies show that houses priced higher than 3 percent of their market value, took a longer time to sell. When a property takes a long time to sell, buyers start to think there’s something wrong with it. This leads sellers to become desperate and sell the property for far less than it’s actual market value.
• All sellers want to sell their homes quickly. But only some are willing to make their houses look salable. Take away eyesores to make your house attractive to buyers. Check every area of the house especially the garage and make sure to remove clutter or stored boxes. Fix what needs to be fixed – broken light, hard-to-open windows and  doors. The appearance and condition of your house will influence it’s price and salability. Cleaning up doesn’t only mean wiping away the dust or scrubbing the floors. It also means putting away most of your personal stuff. It will be hard to sell a house that has so many family photos and mementos. When there’s too much of the seller’s personal stuff, the buyers will have a hard time thinking about making it theirs. Ask your real estate agent for some suggestions on how you could make your home attractive to buyers.
• Market your home. Get as much people to know that you have a house for sale. The internet is the best way to do this. It allows you to reach potential buyers from anywhere in the world who are probably planning to move in your city. But yard signs and local paper advertisements are still effective ways of reaching buyers. Your agent will know how to bring in qualified buyers. The first th/ee to six weeks are the busiest.
• Receive offers. When you receive an offer, your real estate agent will first check if the potential buyer is prequalified or preapproved. The next step would be to review the contract. The contract should include the following: Legal description of the property, Offer price, Downpayment, Financing arrangements,  List of fees and who will pay them, Deposit amount, Inspection rights and possible repair allowances, Method of conveying the title and who will handle the closing, Appliances and furnishings that will stay with the home, Settlement date and Contingencies. As the seller you have three options: to accept the contract as it is; accept it with revisions; or reject it. You need to be careful in dealing with contracts. It is legally binding. If there is anything at all that is unclear, ask your agent or lawyer before signing it.
• Negotiate. Most offers have to undergo negotiating so both parties can get whta they want. Real estate agents are experienced when it comes to this and they should be able to look after your interest and lead you throughout the bargaining process. These are the negotiable items: Price, Financing,Closing costs, Repairs, Appliances and fixtures, Landscaping, Painting, Move-in date. As soon as both parties have agreed to the terms of the sale, your agent will prepare the contract.
• Preparing to close. When you accept an offer, the next thing to do is to think about all the things that you and your buyer needs to do before you could close the sale. The house may need repairs; or the property needs to be  surveyed and appraised. Your agent can act as your spokesperson and deal with the buyer’s agent and service providers. It depends on your negotiation if you as seller need to pay for the cost of the services or a portion of it or even none of it. If the terms on the contract are fulfilled, then you can proceed with the sale. If however, there are problems in fulfilling the terms, you or the buyer can opt to revise or walk out. If you both decide to push through with the sale, make sure to prepare the papers. A few days before the signing, check to be sure that the necessary documents are there.
• Closing the deal. This is when the whole process of selling your house will end. After the signing of contracts, you are no longer the owner of the property. Your agent should be there to guide you through the proces. You may also invite a lawyer to be present. There are some states that require this. After the closing, there are still a few things you will need to take care of. You will need to cancel services like electricity, gas, lawn care, cable and other routine services. If the new owner decides to keep the services, change the name on the account.

If you sell your house looking like a model home, chances are you’ll sell it for a good price. This technique is called home staging. Sellers acknowledge the importance of home staging that it has become a fast-growing profession.

“Staging is not decorating. Decorating is optional, staging is mandatory in order to sell the house for the most possible money in the shortest amount of time,” says home staging instructor Joanne O’Donnell. She has been teaching home staging courses for several years.

The concept was started by Barb Schwarz in 1972 who was then a realtor. She realized that houses that were prepared to be sold prior to putting it up in the market, sold better than those that were not. Today thousands of real estate professionals understand the importance of home staging.

“When we put your home on the market it is no longer your home; it is a product and we’re marketing it,” O’Donnell tells her students.

Home stagers start by taking a close look at the house inside and out. O’Donnell encourages her students to go around the house with the seller. As they go through the house, they should take notes of the things that need to be moved or taken out.

Even though home staging is about improving the appearance of the house, O’Donnell emphasizes that it’s different from interior decorating. “You can’t go out and buy new things for every problem that you have with a house,” she says. Home staging is about decluttering in a way that it looks attractive to the masses. “Clutter eats up equity”, O’Donnell often reminds her students. “The whole idea of staging is that you want to market to the largest number of people to get as many offers as possible,” says O’Donnell.

There are five important points to remember in home staging. O’Donnell refers to them as the Five C’s of staging – clean, clutter-free, color, creatively staged, compromise with the sellers.

Gerin Canin, a lawyer from New York is transitioning into a home stager. She says, “People don’t see that a lot of things that are in their houses are part of themselves and when you try to sell a house you want to make it as neutral as possible, not necessarily in the colors, but in the way it’s presented.”

“I think that when people sell their homes they don’t necessarily see their house as a potential buyer would see their house. They become attached to things. [The seller] doesn’t notice things that other people would notice. So I do think it’s important to have an opinion from someone else,” explains Canin.

Here are some tips from professional home stagers:

Inside the house :

• Clear the clutter
• Remove from sight extra appliances and wirings
• Put away family pictures
• Do what you can to give a lot of open space

Outside the house:

• Paint/Power wash
• Put shutters
• Plants, high, medium, low — with lots of color
• Add decks to improve the look

The price you set for your home is very important. It will determine how long it will stay in the market and how much profit you will get. The knowledge of your real estate agent with regards to this matter is crucial. He or she should be able to inform you in terms of the current market condition, what sells and what doesn’t. Your goal is to price your house that fits its arket value but not too much.

Time. In real estate selling, time is against you. There are several factors involved that can determine the outcome. But time can be a good barometer to gauge your profit. Studies have shown that the longer a house stays in the market, it’s price decreases. So if you want to sell your house for as high as your asking price, do what needs to be done to sell the house quickly.

You need to be objective when you come up with an asking price. How much you value your home may not translate to how much it’s really worth. Don’t spend so much on home improvements and raise the price because of these renovations. Potential buyers might not like the improvements and find your house overpriced.

Because you are running against time. Try to keep things as simple as possible. Keep an open mind and be flexible to your buyers’ requests. As mush as possible do not include contingencies on the sale. This might drive buyers away. 

When you decide to sell your home, one of the things you’ll need to do is to determine an asking price. This can be difficult because you need to find a balance between attracting good offers and getting a high profit.

As you figure it out, you’ll learn about fair market value, which means the amount that you and the buyer can agree on (can be subject to some conditions). It is different from an asking price. 

If you work with a real estate agent, they usually begin by conducting a competitive market analysis of your home and giving you an estimate of the fair market value of your home which is based on the housing market in your area and how much similar houses in your area were selling for.

In areas like California and much of the West where the market is hot, you’re at an advantage. “The market has been gaining steam, and the seller is taking control,” said Nashat Benyamein, a broker in Long Beach, Calif. “Our average number of days on the market went from 30 days to 7 days or less.”

Overpricing sometimes also works to your advantage, but be careful; it might cost you more in the end. There may be several factors that can prompt you to set a high asking price –

• If you’ve made some improvements/additions. Don’t expect to get a full return for what you’ve spent on these projects. Some additions made that seem to suit your personal preference (like a new paint of your favorite color; custom-made fixtures; a sunroom) can actually work against you.
• Need for a lot of money;
• You’ll move to a more expensive house.
• You originally bought the house for an overpriced amount.
• You don’t have much knowledge with regards to factual comparable sales.
• You want bargaining room.
• The move isn’t necessary.

However if you’re in a neutral market like Minneapolis, you need to be careful in setting the selling price.

“While a few select neighborhoods are experiencing good activity, the market generally is favoring buyers,” said Mary Jo Oren, a Realtor in Minneapolis, Minn. “Price reductions are becoming more common and sellers are having a tough time adjusting to fewer offers, fewer multiple offers and increased market time to sell. Buyers are less emotional and not afraid to offer significantly less than list price plus ask for additional seller participation.”

Usually, the asking price is 1 – 3% higher than the market value. You should expect negotiations to take place until you and the buyer reach a price you can both agree on. If your asking price is a lot higher than the market value, you won’t have much offer and your house will stay long in the market, reducing its value eventually. Some buyers wait until sellers reach a point where they seem desperate to sell their home.

Think about the outcome you want. Do you want to sell quickly or you prefer to get as much profit as you can? Is the amount being suggested by your agent fair enough for you? If you were the buyer, would you buy it with the price you set?

You, as owner of the house will have a hard time assessing your house in an objective manner. Bring in some friends and relatives who can help you on this. A third party can help you see your house with all positive and negative points. This is essential in determining the selling price for your home. You should also compare it to the price of comparable houses in your area.

Sixty seconds is all you have to create a good first impression. Here are detailed ways on how you can make your home attractive to potential buyers.

Outside the house:

• Cut the grass and make sure it stays that way. Make the yard look neat by taking away clutter.
• Pull out the weeds and put fresh mulch to flower beds.
• Wooden fences must be painted new.
• Make sure door handles are tight and clean.
• Windows should be cleaned inside and out.
• Powerwash the home’s exterior
• Gutters and downspouts should be firmly attached and functioning.
• Paint the front door.
• Put a new welcome mat.
• Place potted flowers near the front door.

Inside the house:

• Look at the furnitures in each room. Remove anything that looks “off” or anything that disrupts the design/theme. Take out any furniture that makes the room look smaller. Rent a storage unit if you have to.
• Clean and organize cabinets, closets and bookshelves.
• Inspect light fixtures and ceiling fans. Make sure they’re clean and functional.
• Wash the carpets.
• Take away too many “personal stuff”; including wall hangings and knick-knacks.
• Inspect plumbing system to make sure they’re not leaking; and if so, have them fixed.
• Repair torn screens, sticking doors, cracked caulking.
• Clean and repaint if necessary walls and ceilings.
• Replace worn cabinet and door knobs.
• Replace discolored grout.
• Replace broken tiles and worn countertops.

Additional details for showings:

• Turn on all the lights.
• Open drapes and shutters during the day.
• If you have pets, secure them outside.
• Use new towels for bathrooms.
• Use new beddings for bedrooms.
• Replace old lamps or lampshades.
• Play soft background music.
• Light the fireplace.
• Use a comforting scent, such as apple spice or vanilla.
• Set the dining room table for a fancy dinner.
• Do not stay in the house while it is being shown.

Before you put up that “For Sale” sign, make sure that your house is ready for showing. First impressions are very important. You need to attract the buyers at first sight so you can catch their interest.

You may think your effort won’t be necessary especially if you’re in a hot market. But a good first impression will get your house off the market sooner and will allow you to sell your home at your desired amount.

Here are some things you can do to make a good first impression:

• Maintain or improve your front landscaping.
• Put a new and colorful welcome mat at the front door.
• Add a nice, big potted plant to the side of the front door.
• Give your door a fresh coat.
• Put away toys, bicycles, and scooters from the front of the house.
• Wipe the windows clean and make them sparkle.
• Change the doorknob and locks to give it a new and stylish look. It will also impress a sense of security.
• Polish your house numbers or if necessary, change them, so they shine and stand out.
• Put on a beautiful foliage or floral arrangement on your door.
• If there are loose shingles on the roof, fix them before showing your house.
• Fix and repaint the gutters.

If you’ve won the buyer’s attention with your house’s facade, you need to keep their interest. You can start by:

• Remove all the clutter especially in the kitchen and bathroom countertops. Keep toys, photo frames, personal items hidden in drawers and storage bins.
• Hang new bathroom towels.
• Retouch paint in your walls.
• Have the carpet cleaned before opening your house to potential buyers. Vacuum the floors every morning.
• Check your faucets to make sure they are not dripping.
• Inspect all your lights. Replace bulbs that are not working.
• Clean your appliances, not just the outside but the inside as well, especially the oven and microwave.
• Put a pretty centerpiece in the dining table.
• Make the house and bathrooms smell pleasant by putting a deodorizer or potpurri or spraying air freshener. This is especially necessary if someone smokes inside the house or if pets stay inside the house.
• Allow the light to come in all the rooms of the house. In areas where natural light can’t reach, turn on the lights when you’re expecting potential buyers to go to your house.
• Clean the fireplace.
• Remove unnecessary furniture from the room.
• Add final touches like adding a pretty flower arrangement or potted plant.

 When you prepare the home, keep in mind that people’s taste and preferrences differ. Just aim to make the house look clean, spacious, flexible and pleasing to anyone.

When you put up your house for sale, you will come across different people – both pleasing and difficult to deal with. You will be meeting potential buyers, unqualified buyers, agents and unknown vendors. There is an unwritten protocol to how sellers, buyers and their respective agents interact. If you are having a hard time dealing with people, let your agent know so they could help you solve the problem.

• The aggressive agentWhen you hire an agent, they become the primary contact person with regards to the sale of the house. But there are some cases when the buyer’s agent tries to contact you directly. Do not negotiate with them directly especially if you do not have much knowledge in terms of real estate. They might take advantage of this or they probably do not want your agent to be part of the deal. This is not the right way to do business. Inform your agent if this happens.
• The unscrupulous vendorWhen you put your house on the market, there is chance you’ll get tons of junk mail.  Some companies find ways to use information on MLS and bombard you with junk mail. If this happens to you, let your agent know so he or she can get in touch with appropriate organizations.
• The naïve buyerWhen you start to market your home, expect some buyers to simply drop by without an appointment. You might be tempted to show them around but even if they are nice and easy to talk to, you might not be able to handle the situation well. you might get carried away with the easy conversation and discolse information that might compromise your house. If this happens, talk to them politely and refer them to your agent. Give them your agent’s number and tell them that your agent will gladly arrange a tour for them.