BY: JAY BRIJPAUL
Happy New Year. The new rule about mortgage stress test kicked off on January 1st. Buyers will qualify for about twenty percent less mortgage. The federal government’s ambitious plan to invest forty billion dollars into real estate and make homeownership affordable will take effect. This will put a downward pressure on home prices. A small percentage drop in home price can add up to thousands of dollars loss for sellers.
Despite the situation, the housing market trend is predictable. The market picks up by mid-January because there are fewer homes for sale and the trend continues into the spring with more buyers and sellers entering the marketplace. The market slows down in the summer months and then picks up in the fall but not to the same extent as the spring. The best time to sell a home is in mid-January to mid-February because of the lack of supply. The media then, fan the flames of the hot housing market and buyers, speculators and investors become a feeding frenzy, bidding on everything.
The first step is to prepare the home for sale. Declutter the home to its bare minimum to create space. Store excess furniture and other items in the garage or off-site. Once the home is decluttered and cleaned it is a good idea to hire a professional stager. A home that is well maintained and professionally staged will sell faster and for more money.
Perception is a reality when selling a home. Photography is essential in today’s fast-paced world. Buyers shop online and narrow their picks. Drone technology, 3-D virtual tours, professional home videos and high-end feature sheets are the new trends.
Select a realtor based on knowledge, experience and track record instead of relationship alone. Interview three realtors before deciding. Ask each realtor to prepare a market evaluation of the home and to explain their marketing plan. Look at the realtor’s client reviews and how they are currently marketing properties online. The way the realtor markets the home to the public is crucial. Words have power and a realtor’s ability to write attractive ads for your home is imperative.
Many sellers usually opt to go with a realtor who offers to sell their home at the highest price. This can be a fatal mistake because the realtor does not set the price, the market does. Set your price based on what similar homes are selling for in your area. Most buyers shop by comparison and would buy the home that stands out in looks and price. The best pricing strategy is to price the property slightly less than the competition in the area which may cause more showings and multiple offers.
In an offseason market, the seller can choose their terms such as closing date, price, and deposit. In many instances, sellers can negotiate a quick closing date and rent back the property until they are ready to move. This is advantageous to the seller because if the price drops, they are protected. Some buyers may choose to walk away from their deposits. Litigation is expensive and time-consuming as well. If the closing date exceeds three months, it is a good idea to ask for a very strong deposit. Buyers will think twice about forfeiting a large deposit if things get sour at closing.
Selling your home can be a pleasant experience. Sell when everyone wants to buy and polish your gem. Choose the right realtor and plan in advance. Every dollar counts when selling your home. Good luck.