Homeowners and appraisers hardly ever agree on the price of the home. For the past decade, homeowners have been undervaluing their homes or minimally not fully understanding what their home is worth. And one of the major influences on how much a home should sell for has to do with location. Contributing factors to whether your home is undervalued or overvalued has to do with the type of neighborhood, whether the home is by water, or if the home has nice curb appeal. While these factors might contribute to actual price, some homeowners around the country, such as in the mid-west simply tend to think their home is worth more.
There are also internal factors that play a role in whether your home is overvalued or undervalued. The bottom line is that before you have an appraiser determine the value of your home, you should find and clear up any issues such as termites, mold, roof problems, and any outstanding internal issues that would decrease the value. Moreover, Quicken Loans Chief Economist Bob Walters, in a news release about last May’s figures. “Every city, and every neighborhood, moves in different directions based on local factors. Consumers need to remember to watch their local area closely to understand the direction their market is heading.” If you are selling your home, the worst thing that you can do is to over value your home. Before you refinance or before a house is ready to close, an appraiser will come by and look the property over and make sure that there are no potential issues that could prevent the loan from being able to be processed fully.
The reason that homeowners tend to overvalue their homes is because they love their home and naturally assume that it should sell for maximum value. Sellers presume that since they love their home, buyers should also. Therefore, some homeowners get a price amount for their home stuck in their mind that they just cannot get rid of. This is doom to a home sale. If sellers continue with this mindset, the home will likely sit on the market at the high price. Just like a lavender dress in a store window that hangs too long and becomes shop worn; homes that sit on the market too long also become shop worn.
If you have ever dealt with a truly obnoxious homeowner who is getting ready to sell; you know this can be a dreadful experience. While typical home sellers are gleeful about the opportunity to sell and make a killing on their great investment, some home sellers can be bad. Very bad. Other times, this kind of seller can not only kill the deal; they can end up losing money on their sell, because of their bad attitude. Sadly, the realtor in this situation ends up paying the higher price for having to cope with not only a spoiled sell, but also a spoiled seller.
For homeowners getting ready to sell, there are a few things that you should not do. Take a look through the following five facts, and don’t get caught being a Seller from Hell.
- Don’t be Stingy with the Buyer’s Earnest Money
When a buyer is really serious about buying a home; earnest money is provided to hold the house. Just like putting an item on lay away; earnest money is used to secure the sale and allows the buyer to get everything together in terms of financing or even selling their home. In a recent story related to earnest money, a seller decided to hang on to the Buyer’s earnest money. Apparently, there was a dispute over weather damage, and the Buyer expressed concerns over how storm-related issues were handled. In response, the Seller decided not only not to sell the Buyer the home, but also decided to not return the earnest money.
Eventually, the Seller decided to return the monies, rather than go to Court. This resulted in a lot of time and money costs, and the home sale was lost.
Simply, if you want to sell; keep your promise, and don’t keep someone else’s money. Bottom line.
As the economy has been improving so has the housing market. However, there are areas of the country where the market is not as healthy like it is in other areas. The health of the market depends on the neighborhood, as well as how affluent the city is.
It also has a lot to do with how desirable the state is to live in and, how nice the weather is and mostly is it a good time to sell a house? California for example has always been a very desirable state to live in, and this is why the properties in the areas of Los Angeles, Orange Counties and, areas of central and northern California have always commanded a higher price to live in.
1 Cash usage. A good indicator of a competitive market is when sellers are often, given offers that are cash in hand. Buyers who are willing to pay in cash, often understand the area that they are buying in. This is also an indicator of someone that has been, working for a while in their chosen field.
2 Bidding wars. This is when potential buyers put in so many offers that this drives the original asking price of the home up so much and it is a war of who can put in the highest offer of the house before it closes. The thinking behind this is if someone really wants the house, they will raise the price up enough to where other buyers do not have the money to buy it.
Contributor: James Link
Spring is in full force. And in the real estate market, the spring months are the best time for buying and selling homes. Spring is about change, and it’s about getting a house ready to sell so that families can move during the summer when the kids are out of school. With the new mortgage and housing rules that have recently gone into effect over the winter, there is definitely angst about selling, because some existing sales have been impacted by the new rules, including that home buyers are facing different qualification rules and the types of mortgages the lenders will provide. Along with the new rules, housing inventories remain somewhat low, and ongoing concerns about the economy continue to drive volatility in the real estate market.