Exactlyelle’s Real Estate is a  blog  for indiviudals interested in learning about the real estate market.  It is sponsored by Ellen McGibben, Broker-Associate (CA Dre Lic 01271823), Coast Country Real Estate,  Santa Cruz County, California.  Individuals are encouraged to empower themselves by learning as much as they can about the market when buying or selling property!  

Because it matters…

More information about Ellen McGibben can be found at www.ellenmcgibben.com.

Choosing a Realtor

     There is no right way to choose a Realtor.  My own personal bias is by referral but it is a very individual thing. Whether you interview 5 or go with the one your friend uses you should feel comfortable in their presence, be able to speak freely and have confidence in their ability.  It is a good idea for both Realtor and Client to be frank about expectations at the beginning.  Spend some time just talking.  Do you feel at ease or do you feel pressured?  Are you comfortable asking questions? Do they seem to know the Market?  Do they spend time explaining things?  What are your expectations? What are theirs?  You are setting out on a journey with this person that may be brief but could last months to years – it is a good thing if you feel a mutual respect from the beginning.

Because it matters…

Ellen

How Much Is Your Home Worth?

     Seller’s want the best possible price and terms for their home.  Market conditions and interest rates contribute to how much a seller can get for their home.  The goal is to get the best price and terms during the marketing window.

     But… home selling combines science, marketing, negotiation and art.  There are  no certain conclusions.  Every transaction is different.  The listed house does not exist in a vacuum but rather in a complex system of influences that impact the sale.  Sellers can optimize their potential by preparing their house for sale and doing some of their own research.

     In real estate the concept of value is the price at which property would change hands from a willing, unpressured seller to a willing, unpressured buyer.  There is the price a seller would like to get, the price a buyer would like to pay and the point of agreement that results in a sale. 

Some key concepts are important to considering home value:

• The value of a house relates to the value of other houses in the same local area.
• Sale price is influenced by supply and demand. A growing area with an expanding job market and limited housing will  result in a rise in prices.  An area where jobs are being lost and people are moving away with plentiful houses will experience a price decline.
• Seller motivation will influence sale price.  A seller who needs to sell quickly has less power in the marketplace than one who can afford some time.  It is best, but not always possible, to negotiate from a position of power.
• Sale price is not the only thing.  There are many other terms that influence the desirability of an offer.  For example, an offer of $200,000., with a 90 day close and loan approval required  may be less attractive than an all cash, 15 close at $190,000. 

     To determine what your home is worth you should do some research yourself, as mentioned in detail, in a previous post and consult a Realtor.  I have on occasion heard the offhand remark, “Oh, the Realtor just wants to price it low to get the quick sale and some money.”  If that is the way you feel about your Realtor you should find a new one.

     Your Realtor should be someone you know, like and trust.  You should be able to communicate easilyand have confidence in their ability.  Your Realtor will prepare a Comparative Market Analysis.  If you disagree with the list price range in this report you should feel the ease to speak freely.  The seller sets the list price not the Realtor but it is good if it is the result of an frank review of sold properties in a collaborative environment.

     So, how much is your home worth? A  house is worth what a willing, unpressured seller is willing to sell it  for to a willing, unpressured buyer.  One of the goals when listing is to set a list price that will attract buyers because it reflects an accurate consideration of the prevalent market forces at the time.  The setting of the list price is not necessarily what sells the house.  The reaction of the market to the list price is the  key, it  either brings in a buyer or it does not.  

      In ending, if you do your research and connect with a Realtor that you know, like and trust you should be able to set a list price that attracts buyers in the form of showings.  If you are not getting any showings and you  are in a price range that is active in the market you need to keep open about revisitng the list price in a timely manner.

     Only a few years after a sale people often can’t remember the exact price. Was it $210,000 or $215,000? But, they know if they were able to move on with their lives to new things.  It helps to remember, that you are not only selling a house,  you are headed somewhere in you life. 

Because it matters…

Prepare your house for sale – Maximize your opportunity

     It is generally true that “spiffing up” your house will help it to sell faster and for a higher price than if it is in disrepair.  Most sellers are constrained in this by time and money.  One of the first things to consider is how much to spend.  Additionally, there are the considerations of curb appeal and readying the interior.

How Much to Spend?

     Spend as little as possible!  There is a big difference between putting on a new roof or   remodeling the kitchen and painting the rooms a neutral color or replacing the knobs on the kitchen cabinets.  Seek the advice of  your Realtor.  Together you can decide on what will give the most bang for your buck.

Curb Appeal

      A house that looks messy on the outside is less inviting than its well cared for counterpart.  It sends a message that the rest of the house may not be well-cared as well. It can put buyers in a negative frame of mind towards  your house before they have even stepped through the front door. On some occasions buyer’s will simply drive by.  To maximize the curb appeal:

• Keep laws edged, cut and watered
• Trim hedges, weed lawns, flowerbeds and prune trees
• Check the foundation, steps, walkways, walls & patios for cracks/crumbling – repair if possible
• Check windows and doors for peeling paint – repair
• Repair/replace loose damage roof shingles
• Repair/repaint loose siding or caulking
• Plant some colorful annuals near your front door – perhaps in pretty pots
• Keep garage door closed
• Store old rundown cars elsewhere while the house is on the market. If an RV overwhelms the front, store it elsewhere. Although an RV that sits comfortably in the driveway with adequate space around it says “extra parking”
• Apply fresh coat of paint to the front door

Interior Spruce Up

     The following are suggestion for enhancing your homes interior:

• Remove clutter.
• Thoroughly clean every room.
• Take down most personal photos.  This helps buyers to imagine themselves living in the home.
• If you have lots of furniture you mght consider renting a storage space for the time of the listing and moving some of it there to create a sleek, stylish look.
• Remove items from the kitchen counters.  Keep them as free from clutter as possible.  Move the coffee pot, toaster, paper towels and other items you keep on your counter to a closet where you can easily access them.
• Keep the bathroom counter as free of personal items as possible.
• Repaint dingy, soiled or strongly colored walls.
• Repair any plumbing leaks, leaky faucets or showerheads.
• Carpet – cosider replacing severely damaged with a neutral color.
• Put new pretty towels in the bathrooms for showing
• Kitchen- consider painting a neutral color and/or new cabinet knobs or curtains.

The list above may seem long and overwhelming but it contains only minimal expense with the exception of the carpet if you decide to replace it.  If you have limited time pick and choose what you are able to do.  Certainly, many houses go on the Market with no preparation.  If you want to set yourself up to succeed by selling for a  good price in the shortest period of time it will be very helpful to prepare your home for sale.

Because it matters…

The First Step

     The decision to sell your house may begin as a little voice in the back of your head.  It may develop over time until it takes a stronger form and  you make the decision. It  may be something that happens to you – such as a sudden job change or transfer. If you have the luxury of a little bit of time it beneficial  to orient yourself to the current market conditions your house will face.  This will help to set you up for success!

     Begin by reading the local newspaper and magazine ads. Visit, visit, visit, Open Houses – both on weekends and Broker Tour (Thursdays in Santa Cruz County)  Consider the location and condition of the homes you see.  Think about upgrades or  how dated the house may look.  What is the yard like? Is it on a busy street?  When you consider these things it is critical to dispassionately compare the conditions of the house already for sale to your own. List Price, while informative on some levels, is not the relevant figure.  It is Sale Price that matters!

     Develop a realtionship with a Realtor.  It should be someone you feel at ease with, responds in a timely manner,  is educated about the Market and willing to educate you. Your Realtor is an important source of information and can augment  your own sleuthing.  They are also a source to find out the Sale Price of a house. This is how you develop your own sense of the Market and can enhance your success. 

     Take some time to think about what you learn.  How long were houses on the  market?  How did one that may have sold in a short time frame compare with one that took longer?  How did the sale price compare with the list price? Were there reductions along the way?  What is the potential of the property? Again, how do these houses compare, favorably and unfavorably with  yours.  This does not need to be lengthy process. It is amazing how a couple stops by a couple houses in  your range can be educating.

     List Price either gets people to come by and see your home or keeps them aways.   When a house is listed it is the Market response that brings the sale. A hindrance to sale can be a seller that has an unrealistic expectation and could, ultimately, end with the seller getting less for the property than if it had been listed in a more appropriate range.   Developing some personal knowledge of the Market can help sellers to feel empowered and collaborate with their Realtor to set a List Price that will bring buyers in. That is the name of the game!

Because it matters…

Tax Credit Extension

The first-time homebuyer tax credit has been extended until April 30, 2010. 

The $8,000 tax credit for homebuyers who are purchasing their first home has been extended from  November 30, 2009  to April 30, 2010 if the escrow closes no later than June 30, 2010. The program also  offers a credit of $6,500 to homeowners who have lived in their current home for at least five consecutive years and who relocate. 

Eligiblity guidlines:
-First-time homebuyers- buyers who have not owned a principal residence during the 3-year period prior to the purchase, may be eligible for up to an $8,000 tax credit.
-Current homeowners who have lived in their principal residence for 5 consecutive years out of the last 8 and buy a home to be lived in as their principal residence, may be eligible for up to a $6,500 tax credit.
-Participants must be citizens of the United States and file income tax.

Income Guidlines
Homebuyers filing as single or head-of-household taxpayers can claim the full credit ($8,000 or $6,500) if they have modified adjusted gross income of less than $125,000.
-Married couples filing a joint return, must have a combined income limit less than $225,000.
-In some instances partial credit may be awarded depending on filing status and income limits.

-The home must be purchased after Nov. 6, 2009, and before May 1, 2010. If the sales  contract is signed by April 30 2010, the transaction will meet the qualifications if it closes by June 30, 2010. Homes purchased must be used as principal residence and less than $800,000 purchase price.  The credit does not have to be repaid if the home is kept as the buyers principal residence for 3 years.

Because it matters…

Ellen