Archive for August, 2014

August 11, 2014


Results from too high an initial price

Lowering your price after listing causes a chain-reaction in the marketplace that reduces the status of your listing. In the eyes of other agents that might bring buyers your way, a price reduction raises red flags. Here’s the short list:
You miss the critical first 14 days when buyers and agents are most interested in a new listing.
Other agents may dismiss you as an unreasonable seller that would be difficult to work with.
Your home can no longer compete with other new listings fresh on the market, particularly if they are more fairly priced for your market.
Buyers may think something is wrong with the home. They may press for more concessions, discounts or repairs, and upgrades.
Relisting your home at a new price is not really a new listing, so agents may simply dismiss it.
Price your home right the first time
We are professionals that know the market for your home. Let us help you price your home fairly from the start. When priced correctly, your marketing strategy works for you to sell your home as close to your asking price as possible.
Regardless of what you may believe about the value of your house, pricing it commiserate with five years in the past or five years into the future is to doom your home’s sale.
Current fair market value means: The price that an interested but not desperate homebuyer would be willing to pay and an interested but not desperate homeseller would accept on the open market for your area and based on comparisons to homes in location, size, upgrades and amenities.
What if prices are going down?
If prices in your area are trending down when you choose to enter the market, you may want to set your price “under” the fair market value so that you’re not forced to lower your initial price and trigger the results listed above.
What if prices are going up?
You cannot anticipate the market, so if prices in your area seem to be going up you can choose the top end of the “fair” range. Do not overprice your home, however, since market trends are volatile and can shift just enough to place your home out of range. Remember that lenders operate slightly behind the market, so if your home is too high too soon, a buyer may not be able to obtain funding to buy it.
Increase the value, not the price
As professionals, we work with you to set the right price for your house and get the most for your home sale. Some ways to raise the initial fair-market-value of your home are:
Make sure your home is in the best condition possible: make repairs, simple upgrades (e.g., light fixtures, faucets), and clean, clean, clean.
Neutralize deep paint colors and strong faux finishes. This doesn’t mean to paint everything white, but a modern neutral such as café au lait, warm gray or deep cream sets a canvass for homebuyers to visualize their own furnishing in.
Depersonalize your home: buyers want to see themselves in the home, not the former owners. Remove family photos, trophies, school banners, children’s artwork and other giveaways that might hinder a buyer’s vision for his new home. Make sure none of your personal information is visible: hide bills, letters, cards and other items with your name.
Clear clutter and simplify furnishings: As we live in our space, we tend to add, but rarely take away. An extra bookshelf or side table fits our needs, so we ignore that it crowds our space a little. When buyers enter a furnished home, crowded spaces can make the house appear too small. Clutter, even decorative clutter, can obscure a home’s assets such as architectural detail, higher ceilings and beautiful wood trim.
Setting the right price
We can help you set the right price the first time, so call us and we’ll get started today. Patty Lance 949 933 4742

August 11, 2014

Nine culprits in housing’s chill

If only developers built more affordable homes.
Obviously, that might satisfy some bargain hunters. Plus, in the long run, those starter homes create a new flock of first-time buyers entering the homeownership track.
But low-end housing is a low-margin business, and despite all the talk about creating affordable housing, it’s an endeavor not widely embraced by city leaders or their homeowning constituents.
So builders gleefully chase the prime move-up market, which makes selling used homes trickier.

As you know, we only publish bad news. And it’s scary enough to bet one’s life savings on a home – but even more unnerving when the headlines are bleak.
But wait! Apparently in this cycle, it’s the opposite!
To some observers, the media’s repeated announcements of the stunning post-recession recovery have made buyers think they can still steal real estate bargains … while the same news drives seller’s price expectations too high.
Ah, the plight of the messenger!

God bless Zillow, Trulia and their online, independent real estate information machines.
They’re total game changers when it comes to house shopping, arming owners and house hunters alike with reams of valuable information.
Except when it comes to the automated house valuations these sites publish.
Just because estimates are computerized doesn’t mean the valuations are anywhere near accurate. These errors can scare off shoppers as sellers feel empowered to keep asking for higher prices.

Obviously, this summer chill wouldn’t be here if shoppers could only see the true value that remains in the housing market.
Why do house hunters look at lofty home prices, (up 50 percent off the bottom in some communities) then recall the last housing debacle and worry?
To be fair, shoppers should know why they are delaying a purchase. If it’s a bet that prices will be lower next year, they should weigh that probability vs. the possibility that mortgage rates will go higher.

Nothing drives housing like job growth, and the region is enjoying its fastest hiring spree since the turn of the century.
But bosses in all industries have kept the mid-recession, penny-pinching mentality well into the recovery. So every cost, especially labor-related outlays, is kept in check.
While I appreciate that frugality, the constant financial micromanaging in an era of record corporate profits does nothing to instill overall economic confidence, which is a drag for many consumer-driven niches, including real estate.

The root of everything that’s wrong with America’s economy. Or so I’m often told.
Bureaucrats and politicians should get out of property owners’ development rights except when current owners don’t like what the developer plans down the street.
Mortgage rules should be loosened, except not so much as to cause another catastrophe.
And a free economy should exist, without politically preordained winners and losers. Except that the mortgage deduction – tilting ownership over renting – is a good thing, yes?

Anybody know what business these people are in these days? That bad joke “only people who don’t need money get loans” seems well suited.
The gall of these bankers: to demand that mortgage applicants have verifiable employment, a steady income stream and a history of repaying bills!
Yes, mortgage qualification standards have been loosened a bit in the past year or so. Still, considering the resilience in the housing market, you’d think bankers would want more home-loan business.

It’s not 2013, and that seller’s market won’t be back soon.
Look, this pricing formula does not work: Take the last comparable sale, add 5 percent (or maybe 10 percent if you’re sure you have better view/backyard/paint/appliances/whatever).
Be warned, the free market has a cost. When demand says “no thanks,” prices must be trimmed.
Perhaps wannabe sellers should visit a nearby new-home project to see what’s offered in their valuation range. Remember, builders are in one business: selling homes quickly.

We’ve already tagged the misguided buyers and sellers, and each of these relatively unsuccessful groups was likely getting advice from a real estate pro. Who’s managing the expectations gap?
But what I really don’t get is all the negative agent talk, especially in social media circles.
Like any American, real estate pros are entitled to political and societal views. But frequent public questioning of the stability and morality of the region, state and nation doesn’t do much to build homebuyer confidence.
Agents don’t have to be blind cheerleaders. But if the real estate industry won’t paint the picture for homeownership, who will?