Selling a home in today’s market can be a pretty scary thought.

There are so many homes on the market, prices seem to be plummeting and buyers are just looking to “steal” the properties.  You may actually owe more than the home is worth in today’s market.  What do you do then?

First and foremost, real estate is local, right down to your home.  Second, if we look at the facts, things may not be as bad as you think.  

First let’s analyze the sales prices and sales rate historically.

If we look at long term sales rates for the metro area since 2001 it becomes readily apparent that the average resale rate in the valley is about 100,000 sales per year except in 04 and 05.  That is when everything really spiked.  Then if you look at what happened after, sales dramatically slowed until this year when the sales rate picks up.  The important thing to note is that if you put the peak in the valley, our 100,000 sales per year would have happened.  To me, this means that the market is returning to normal. Prices follow the same trend.  Today, the median price matches up to the median price in about 2004.  As the overall market and economy reaches equilibrium, we will see prices increase at a rate consistent with inflation.  This means that if you bought prior to 2004 and did not borrow additional funds on the home, you are probably in pretty good shape on the pricing of your home.  If you bought during the boom, or took out a loan on the extended value of the home, you are probably underwater.

There are differences in what is going on.  In general, the lower price ranges are performing better than higher.  And the higher you go, the lower the performance.  This is a natural trend because the people who can react the fastest and move into homes are renters.  That allows the person who sold the home to the renter to move up to the next home and so on, so there always has been a lag.  This time there is an additional factor.  Because during the boom, people could buy more home due to the financing that was available, many people over reached. During the recessionary period, the first people to be affected were in the lower price ranges, but as the recession has continued, we are seeing more affluent people having trouble making payments and the number of distressed properties are increasing now.  This has also contributed to the lag and probably means that price reductions in the higher ranges are not over yet.

Let go over what you should do now.

1. Price your home to sell.  That doesn’t mean be the lowest on the street, but make sure that you consider the following elements.  

• What has been the recent history for sales in your neighborhool.
• What is currently listed and how long have they been on the market.
• How does your home compare to the others on the market right now. Be brutally honest, because potential buyers are.

2.Do what you need to do to make the home showable.  You only get one chance to make a first impression.

• Street appeal.  How is the landscaping and exterior paint?  If a buyer doesn’t get out of the car, it doesn’t do you any good.
• Get rid of any excess furniture etc.  You want rooms to look expansive.
• Get rid of any controversial  things.  Paint the red wall.  Get rid of the def leopard posters
• Get rid of clutter in closets and garage.
• Make sure everything works, and everything is clean.
• Order an inspection and fix anything on the list.

3.When the home is being shown.

• Make sure everything is picked up, beds made, dishes put away, trash thrown out.
• Put pets in a safe place or take them with you.  Leave the home.
• Make sure the realtor with the people knows about any pets or kids if they are there.  No one likes to be surprised.

4.When you get an offer, don’t be offended.

• In this market, everyone has been conditioned to offer low prices.
• Take some time and analyze the offer.  Is the buyer qualified?  What are all of the terms?  
• Make sure that before you counter, there is a reasonable opportunity for the home to appraise.  Otherwise, you will be back to the table.

If your house is worth less than you owe, do this before you put it on the market.  
    

• Do you need to sell now or can you wait until better times when prices move up?
• If you must sell, you must talk with your bank and explain the hardship.  Get them to agree with allowing a short sale and get  them to commit to taking whatever you get for the home.
• They are your partner, and not a very good one.  They are slow and may actually put conditions upon the sale that nobody can live with
• Get legal advise.  Lenders can come back on you for deficiencies 5 years after the sale.
• List the home with a qualified agent, who knows how to negotiate short sales.  The agent is not going to be able to talk to the lender, only you.

Can I be of service to you as your listing agent?