Price it Right!     

The first mistake home sellers are making is listing their homes for prices that were selling 1, 2, or even 5 years ago.  Everyone knows the market has softened, in some areas more significantly than others.  Find out what your home is worth and list it for 15-20% less.  Although this is a scary thought for home sellers, listing your home for less than what it’s worth has many advantages:

1.    Homes with low asking prices often generate multiple offers, which can turn into a bidding frenzy between buyers – often times your home will end up selling for more than what it’s worth.

2.    Homes listed for less than market value will sell much quicker than those listed for market value or higher- everyone is looking for a good deal these days. 

3.    The longer your home is on the market, the less attractive it becomes – stale homes present the fear to buyers of “why isn’t this home selling?  There must be something wrong with it.”

De-clutter and Re-organize!

Removing clutter on and around your furniture not only makes the home appear larger, but shows that the home is well kept by the current owner.  Seeing a house that is clean and organized makes a potential buyer assume that even the parts of the house that they cannot see are kept clean and organized (e.g. the plumbing, electrical and HVAC systems are probably in good working order, which will save the potential buyer money and headaches in the long run).

De-personalize your home!

Along the same lines as de-cluttering, depersonalizing your home can help a potential buyer better imagine living in the home.  Remove photos, memorabilia and anything else that does not serve an apparent purpose from in and around the home (e.g. golf clubs, shoes and kids’ toys have no reason to be on the floor in the kitchen).

Turn on the lights!

A well lit home not only looks larger, but is much more inviting than a dark home.  If you have a lot of windows, take advantage of this by opening all shades (unless you live next to some kind of eye sore, then just stick to the lights).  Turn on all lights in every room, and make sure every bulb is bright and working.

Revamp without reinventing!

Tackle the small improvements that make a big difference and stay away from major renovations that are likely to cost more in time and money than you will end up getting back in the sale of the house.  If you’ve been meaning to re-grout the bathtub for years, NOW IS THE TIME!  If that brown spot in the ceiling is still showing from the leak that was fixed a year ago, paint it! 

Highlight the Kitchen!

Again, without reinventing, just revamp the kitchen, if necessary.  If your kitchen is completely outdated, don’t gut it and start over – try simple fixes like painting, changing cabinet hardware or even changing the countertops or lighting fixtures for a few extra bucks.  The kitchen is the number one room in the house, and also the most expensive to remodel.  You don’t want potential home buyers to think they have major work to do in the kitchen, so make it appear as flawless as possible.

Remove the pets and children!

You may love them, but potential home buyers don’t want to see other people’s pets and children in their future home.  Have someone watch the kids on Open House days and leave the pets outside, if possible.  Don’t leave litter boxes and dog food bowls out for potential buyers to see and smell, and again, pick up the kids’ toys!

Have Open Houses!!!!

Whether you’re using a broker or not, the best way to sell your house is by having open houses as often as possible.  Of course you should list your home on as many websites as possible, and include pictures and detailed descriptions, but have open houses!  In today’s world, potential home buyers are very particular and weary of being “sold”.  Most buyers will do the majority of the research at home on the computer.  Once they’ve narrowed down the search, they want to slowly approach the house without being attacked by the seller or seller’s agent.  Open houses give people the opportunity to stroll in and out without formally showing interest.  Of course, you have to watch out for “Serial Open Housers” who spend weekends walking through houses when they have no interest in ever moving.

Pre-Qualify Your Potential Buyers!

Without being too premature, make sure you ask those who show real interest the following questions:

1.    What is your price range?

2.    Do you have a house to sell?  If so, is it on the market and how much are you/do you plan to ask for it? Do you have a mortgage?

This will cover 2 issues:  First, is this a serious buyer or a serial open houser; second, you can find out if there will be any obstacles out of your control for the potential buyer – e.g. a house that won’t sell.

3.    Where do you live now?  Do you have kids and are they still in school?

This is one of the most important pre-qualifying questions if they do have kids – a lot of people don’t want to move their kids from school to school unless it’s for a better school.  If they’re in a great school district now and your school district is mediocre, they are not likely to make the move.

Make a great First Impression!

You only get one first impression, so make sure your house is in the best condition possible when you have people come to look at it.  Not only should the inside be CLEAN, de-cluttered and inviting, but the outside should be also.  If there is a fallen tree in the back yard, get rid of it!  If there is a piece of siding falling off the house, get it back on – even if it’s a temporary fix.  If your screen door has scratches from the cat, replace it, or just take it off completely.  You don’t want anything to appear to be broken or neglected.  

When it comes to building your new home, you have many decisions to make.  One of the most important is choosing your builder.  Doing some light research on your builder by contacting references, visiting past projects and asking questions can make the difference between a nightmare and a dream experience.  Some of the qualities to look for in a builder are longevity in the business, quality of the product, customer service and reputation.  By considering each of the topics below, you will be able to choose the builder that’s right for you.

Longevity:  Look for a builder that has “been around the block”.  With longevity comes experience, expertise and knowledge.  Visit completed projects and projects under construction and talk to homebuyers about their experience. 

Quality:  Any builder should be able to slap a house together, but the quality of material and workmanship make the difference between a nightmare and a dream.  Make sure you ask your builder about the materials they use and the unique practices that make them stand out among other home builders.

Customer Service:  There’s nothing worse than realizing you’ve purchased a defective product without some kind of warranty.  Any good builder stands by their product with a detailed warranty.  Make sure you understand the warranties on the home you are buying to avoid any headaches.  Ask your builder to explain the customer service process and to give you a copy of the warranty to review before you purchase your new home.

Value:  Unless you go to a Custom Home Builder, which is generally significantly more expensive, most builders limit your customization options.  This can be frustrating since every home buyer has their own individual needs and wants.  Make sure you find out from your builder if they allow customization and design flexibility, such as moving wall, adding a window or flipping the footprint of the house.  Also find out about special packages that can be purchased to include upgrades, which can be a much greater value than individual upgrades. 

Q:        Shouldn’t I wait until home prices go even lower to buy?

A:        No. Just as no one can accurately predict the peaks and valleys of the stock market (name one person who sold their tech portfolio in April of 2000), the same holds true for housing. If you wait for what you think is the absolute best deal, you could end up waiting for years. All the market fundamentals show that now is a good time to buy – prices are down, interest rates near historically low levels, and there are lots of homes to choose from.

If you buy now, you will not only be in the driver’s seat during the buying process, you will also reap the gains of price appreciation. Remember, those who purchased homes in the early 1990s during the last big economic and housing downturn came out as big winners.

Q:        Doesn’t it make sense to wait out the market until I can get the same price on my home that my neighbor got when he sold a year ago?

A:        No. It’s always better to trade up in a buyer’s market. While the value of your house has fallen, the prices of higher-end homes have also dropped. Here’s an example:

Your neighbor sold for $300,000. Let’s say values in your area have dropped 10 percent, so you could get only $270,000 for your home today. You have your eye on a move-up home that previously sold for $500,000, but now is selling for $450,000. If you sold your home today for $270,000 and purchased the larger house for $450,000, the difference in price would be $180,000.

But if you waited to recoup the 10 percent value on your home and sold it at $300,000, chances are the move-up home would also increase in price 10 percent to $500,000. That’s a $200,000 price difference. So by selling today, you would actually save $20,000.

Q:        Interest rates keep going down. Shouldn’t I wait until they go even lower before I buy a home?

A:        Interest rates for 30-year, fixed-rate mortgages are currently below 6 percent and are extremely favorable for buyers. In fact, they are hovering near 30-year lows. But waiting to time the market is a dangerous game. Even those who follow the market for a living can’t figure out when interest rates will bottom out. If they could, they would all be multi-millionaires.

            And home prices don’t necessarily move in unison with interest rates. So, if you decided to wait to purchase a home and the price dropped $10,000 from where it is today, you could still end up losing money. How? If interest rates were to move up by a half-a-point during this period, the savings on the reduced home price would be more than offset by the higher monthly payment you would be making over the life of the loan.

Q:        I have $10,000 to invest. Should I put that money in the stock market or buy a home?

A:        Purchasing a home is by far the best long-term investment. For example, say you use that $10,000 to purchase a $250,000 home, and the house appreciates a modest 3 percent during the first year. That means after one year, the house would be worth $257,500 – a gain of $7,500. By contrast, putting the same $10,000 in the stock market and posting a similar 5 percent gain would only net a $500 return on investment.

And don’t forget the tax incentives. In most instances, all of the mortgage interest and property taxes you pay in a given year can be fully deducted from your gross income to reduce your taxable income. These deductions can result in thousands of dollars of tax savings, especially in the early years of the mortgage when interest makes up most of the payment.

Q:        I’m a first-time buyer and still can’t afford the type of home that I want. Is it best to wait, keep renting, and hope that prices will get even lower?

A:        If you continue to wait, you may never be able to afford to get into the housing market. Even as home prices are currently moderating or falling, depending on where you live, rents continue to climb. When you buy a home, you are also purchasing price stability, knowing that you will pay the same monthly payment for the life of your 30-year, fixed-rate mortgage.

Once you become a home owner, you are able to take advantage of the tax deductions that homeownership offers, and you begin to build equity in your property.

With so many homes on the market to choose from, your best strategy may be to scale back expectations for your dream starter-home. After a few years, you can use those equity gains to sell your starter home and move into a bigger house. The sooner you make the jump from renter to home owner, the quicker you begin to create and build up wealth for your family.

Did you know that there are several different ways you can create an energy efficient home, from the quality of products and materials used to the quantity of certain products?  Many new home buyers and homeowners might visit an ENERGY STAR showroom and expect their home to look exactly like what they see when it’s complete, but the truth is that there are many different combined choices that go into making a home an ENERGY STAR home.  These include, but are not limited to:

Air-Sealing

Air sealing is one method used to prevent the loss of heat in the winter and cool in the summer through unseen cracks.  This air (and your heating and cooling dollars) is lost in areas such as fireplaces, attics, basements, duct systems, doors and windows, plumbing systems, recessed lighting and electrical outlets.  Having drafts through these “cracks” can allow moisture to build up, which can result in mold and mildew, as well as structural damage.  This not only creates an uncomfortable living situation, but an unhealthy one.  Additional air sealing around windows and doors, plumbing and ventilation systems, and electrical outlets can eliminate the loss of air and help your home perform more efficiently.  A “blower door” test (which is part of the HERS score) is performed on every ENERGY STAR home to detect air loss and to ensure greater energy efficiency.

Insulation

The type (or the R-value), the amount and the placement of insulation in a home can result in very different HERS (Home Energy Rating System) scores.  The R-value measures the efficiency of the insulation, so a higher R-value equals a more energy efficient home.  Added insulation in floors, walls and ceilings can not only help the energy efficiency of a home by further blocking air from being unnecessarily expelled, but it also acts as a sound buffer.  

Mechanical Ventilation

Although ENERGY STAR homes try to eliminate air loss by making seams tight, the air inside of the home needs to circulate to prevent stale air and, consequently, mold and mildew from forming indoors.  This is accomplished by installing some type of ventilation system.  The different levels of ventilation include exhaust-only, simple balanced ventilation and heat-recovery ventilation.  

• Exhaust-only - provides a way for indoor air to be sucked out, while new air comes in naturally through open doors and windows, and small cracks.
• Simple balanced ventilation – allows indoor air to be expelled, as well as brought back into the home to create more a controlled air-exchange.  
• Heat-recovery ventilation – performance is similar to the simple balanced ventilation, but it goes one step further by preventing heat from being expelled for the air exchange.

The difference between the three systems above is the resulting HERS score and utility costs, as well as the comfort and health of the home.

High-efficiency Appliances & Lighting

Energy Star appliances allow homeowners to save money, conserve natural resources, and protect the environment by performing more efficiently than traditional appliances.

• Washers & Dryers – ENERGY STAR washers use 55% less energy and 50% less water, and use a much more effective spin cycle, which decreases the drying time.  
• Refrigerators & Dishwashers – ENERGY STAR refrigerators offer the same conveniences of conventional refrigerators, but use half the energy.  ENERGY STAR Dishwashers clean more effectively, but use less energy and water.
• Lighting – ENERGY STAR light fixtures and bulbs use less energy and last significantly longer than regular light bulbs, while they still provide natural and even lighting to a home. 

Windows

Aside from increased air sealing and insulation around windows, the actual windows used in building a house can significantly reduce energy costs, as well as increase comfort.  Windows with Low-E glass (in the form of gas-filled glass or special Low-E coatings) limit solar heat gain without reducing the visibility.  These energy efficient windows are also temperature resistant in that the glass and frames won’t get too cold or hot to the touch in extreme weather.  Another positive aspect to the Low-E windows is the resistance to ultraviolet rays which can cause fading of furniture and flooring materials.