Many homeowners are not deciding to sell in this current market, but instead are looking at updating or upgrading their current homes. When upgrading, home owners should seek features that aren’t only desirable to them but also what will add value to the home when it comes time for resale.
Here’s some general advice from Bankrate.com to help guide you as you consider any changes in your home to determine if it would increase your home’s value.
These items may not be worth the expense:
Too high maintenance. Many buyers aren’t looking for homes that require too much upkeep and maintenance. The article notes in-ground swimming pools as a prime example of a high-maintenance feature that may turnoff many buyers as they look at the upkeep of it as too costly and too much work.
Over-the-top. Home owners don’t necessarily want to have the most upgraded home on the block. That’s because when they go to sell it, they likely won’t make all their money back on the upgrades if the home becomes overvalued for the neighborhood. So while granite countertops, stainless steel appliances and all the top finishes are always an attraction, home owners need to ask whether such features are too much for their neighborhood, particularly if the other homes just have moderately priced cabinets or features.
Too personal. Too much customized design choices, such as a Tuscan theme taken to the extreme, may turn off buyers or attract low-ball offers at times of resale because buyers who may have differing tastes see the decor and finishes as something they have to do-over. “Any time you deviate, no matter what the improvement is, from what is a fairly traditional, single-family house, you run the risk of improving in a fashion that will not lend itself to additional dollars,” Miami real estate pro Moe Veissi told Bankrate.com.
Unpopular. Ensure that the change in your home will not only be a good fit for your family and lifestyle, but will be wanted by traditional buyers.
If you are thinking of making changes, but don’t know how much value you are adding to your home, call The Marr Team – we will give you honest numbers and advice on your project and your home’s value.
Colby Sambrotto, one of the founders and former COO of ForSaleByOwner.com recently spent six months trying to sell his condominium himself through online listings and classified ads before turning over the condo listing to a New York broker. The broker told Sambrotto that he had actually priced the condo too low and was not attracting the right buyer for the condo. At first Sambrotto would not let the broker increase the price, but finally gave in. The condo soon attracted multiple offers and ended up closing recently for $150,000 more than the original asking price and Sambrotto paid a 6% commission on the $2.15 million sale. While this story is very ironic, it details a typical scenario that happens everyday.
Each year less sellers take the risk of navigating the real estate market on their own. In 1991 19% of sellers sold their home For Sale By Owner (FSBO), but the total number of FSBO sales have decreased dramatically since then. In fact, the National Association of Realtors reports that in 2010 the number of FSBO sales decreased to 9% of total homes sold and only 5% of those were sold on the open market (the seller did not know the buyer).
The number one reason that people try to initally sell For Sale By Owner is to save money, but statistics show that 90% of all FSBO sellers end up turning to a real estate professional for help. In these times we all understand trying to save money, but statistics show that FSBOs actually end up saving more money by having professional advice which sells the home faster, for more money and also greatly reduces monthly carrying costs (and frustrations).
FSBOs report that the most difficult task in this real estate market is setting the price correctly as demonstrated by Sambrotto’s story as well. There are a number of other factors to consider when determining how you will approach the real estate market with your home.
TIME: Selling a home is a full-time job and requires answering multiple phone calls, showing buyers, following up with interested parties, writing offers, negotiating contracts, coordinating appraisals, inspections, surveys, keeping up with lenders and brining everyone to the final closing which also requires understanding and answering numerous questions. Another factor of time is ensuring you are only spending your time dealing with serious, qualified buyers.
MORE COMPETITIVE MARKET: All sellers are not just competing with their neighbors, but also foreclosures and short sales and the difficulty of positioning a home correctly on this market is why 23% of FSBOs report that setting the price is the most difficult task. Remember REALTORS® see and sell hundreds of homes over the life of their career while most sellers sell only a handful and most likely have not seen their current competition when they put their home on the market.
MARKETING: While there are websites that cater to FSBO properties, they have no access to major online marketing avenues in a time when a large majority of buyers are selecting their homes online. Sellers also have no avenue to advertise their homes to other real estate agents who are guiding the majority of buyers on the market.
SAFETY: Safety should always be a factor when letting someone unknown into your home whether you are alone or your family is in the home.
LEGAL PITFALLS: Today there are more disclosures and legal requirements for sellers than ever before.
The Marr Team helps FSBO sellers with required disclosures and consulting or if you are ready tolet someone else do all the work and get your homes sold let us put our aggressive and successful marketing plan to work for you today!
Expansive Soils + Heat – Water = Moving Foundations. I have heard more than usual people talking about foundation issues and I have heard that foundation companies are extremely busy right now. So I just wanted to take a few minutes to share some information on the subject. I am certainly no expert in foundations, but I do talk to and meet with experts and learn things in my line of work from time to time and just thought I would share them. Please consult with true experts if you have additional questions or concerns.
1. Many people “water” their foundations incorrectly – I know I did too at one point. When the weather is so severe that you start seeing large cracks in the soil or the soil starts pulling away from your home you need to add moisture to keep the soil at a consistent level. Sometimes with the severe heat we have been having just watering your lawn may not do enough for your foundation and we pull out the soaker hoses. The soaker hoses should be placed 15-18 inches away from your foundation. Do not put soaker hoses up against your foundation as this can erode the soil at the base of the foundation and may not evenly provide the foundation moisture and cause additional problems. Using electric timers on the soaker hose will help regulate the amount of time and water.
2. Don’t forget about the flower beds and plants. Flowerbeds and areas with plants will require more water because the plants are thirsty too – you may need to turn up the sprinkler system on zones with trees and plants to ensure they aren’t stealing all the moisture from your foundation. You may not notice the ground separating in those hidden areas behind mulch or plants either if you don’t don’t pay close attention.
3. If you feel that you have foundation issues you can have free foundation estimates or you can have a structural engineer consult on the issue. If you have a foundation company come to look at the issues make sure you have more than one come out to get varying opinions – remember they have a product to sell you. Or you can make a $450 investment in a structural engineer consulation and they can let you know if you really have problems, options to remedy and guide you through the process ensure that any work completed is done correctly as well.
Keep in mind that expansive soil is like a living thing that grows with moisture and shrinks with lack of moisture and that doesn’t necessarily mean you have a problem. Strive to keep the soil around your home at a consistent moisture level year round.
Let’s get cooking! We can help you understand the market and find the best deal. Call us today for a free, no-obligation consultation. And try this cool tomato salad to enjoy during these hot summer days.
YOUR REALTOR® can be a great resource even when you aren’t currently buying or selling real estate.
Home Renovations, Add-ons, and Thinking of making some changes to your home? Even if you won’t be selling for a few years, you might want to know what current trends are so you can ensure your updates will add value to your home in the long run. You may also want to ensure you are not overbuilding (upgrading beyond the standard) for the neighborhood. Sometimes the question may be as simple as whether buyers favor wood or tile floors, what types of pools are popular or as in-depth as determining whether a room addition would be a good investment. YOUR REALTOR® can provide advice and information.
Neighborhood Information Your neighborhood has an enormous effect on the value of your home. Sometimes you want to know the price your neighbor received for his home or who is the owner of record for the vacant home with the overgrown grass. It is great to be updated with facts, not just neighbor gossip. Just ask YOUR REALTOR® for the information you want. We offer websites that provide up-to-date information on any real estate matters in your neighborhood or call for specific information.
Comparative Market Analysis (CMA)Thinking about refinancing, upsizing, or downsizing in the future? Want to know what your home would sell for in today’s market. YOUR REALTOR® can compare the specific amenities in your home to comparable homes that have recently sold to provide you the information you need to make an informed decision about your family’s future. If you or someone you know is facing difficulty in these tough times we can consult on various options for homeowners who may be “under water” on their mortgage or are facing difficulties making mortgage payments.
Protesting Homeowner TaxesIn May, when you open your tax bill you may first be elated to see the value of your home rising, then you remember you have to pay taxes based on this new assessed value. Is this a true current appreciation on your home or has the county overshot their numbers? Let YOUR REALTOR® know you are questioning the numbers and have them do an analysis to determine whether you might successfully protest your taxes. YOUR REALTOR® can prepare you with facts to show the appraiser when you meet with them. (Remember tax values are not a true indicator of market values as they vary widely in neighborhoods based on whether some homeowners have protested while others have not. Tax values should not be used as a basis of determining the sales price of a home so protesting your taxes will save you money and should not affect your market value.)
Finding an Agent in Another AreaLet YOUR REALTOR® do the work to connect you with a real estate expert in any location across the country to ensure you get excellent service and information at your new location.
For Sale By OwnerThinking of trying to first sell it yourself? Contact YOUR REALTOR® to provide you with some important documents and disclosures that you, as a seller, are required by law to provide to any buyer.
Let us be YOUR REALTOR® we provide no-obligation consultations, market analysis and neighborhood information to all our clients, neighbors and friends and we would be happy to do the same for you!
Wise consumers are fleeing the insecurity of the adjustable rate mortgage (ARM) loan for fixed-rate loans. According to the latest mortgage application data from the Mortgage Bankers Association (MBA), borrowers are clearly choosing fixed-rate loans over adjustable rate loans – less than 7 percent of the total applications were for adjustable-rate loans. That leaves the vast majority of borrowers, whether refinancing or getting a new loan, choosing a fixed-rate loan for their purchase or refinance. Borrowers choosing fixed-rate loans will typically select a 30-year fixed-rate mortgage, but depending on your situation and needs, it could save you thousands to also “run the numbers” on a 15-year loan.
The reasons many consumers choose a 30-year mortgage is because it will give them the highest buying power because it is the lowest monthly payment. These lower payments can free up money that you can pour into savings and other investments. The disadvantages to a 30-year mortgage versus a 15-year is that equity is built at a slower pace because payments during the first several years go largely toward interest rather than principal. This may not be a problem in areas with faster appreciation or when you plan to stay in your home for 7 or more years. Over the life of the loan you will also pay thousands more in interest in a 30-year loan, but the interest you do pay can be deducted at tax time each year, thereby reducing federal income tax liabilities.A 15-year loan has the advantages of saving thousands in interest over the life of the loan and also has a lower interest rate. Traditionally, your home is a safe vehicle for building personal wealth and the quicker you build the equity the faster the wealth can grow. Because payments are qualified as a percentage of monthly income, the drawback of the 15-year loan is that the higher payment can restrict you to a less expensive house than you might be able to afford with a longer term loan with lower monthly payments. The following illustration shows how some loan options could help you whether considering a new mortgage or refinancing.
*30 Year Loan Term on $165,000 at 6.5% interest is a monthly payment of $1,042.91 with a total interest of $210,411 over the life of the loan.
*15 Year Loan Term on $165,000 at 5.99% interest is a monthly payment of $1,391.47 with a total interest of $85,465 over the life of the loan.
Potential Saving from Refinancing
*30 Year Loan Term on $165,000 at 5.0% interest is a monthly payment of $885.76 with a total interest of $153,870 over the life of the loan.
* 15 Year Loan Term on $165,000 at 4.75% interest is a monthly payment of $1,283.42 with a total interest of $66,016 over the life of the loan.
This past month, rates have been hovering around 5. Now is an excellent time to look into refinancing your mortgage with a 30 or 15-year fixed. Depending on your monthly savings at our incredibly low interest rates it is not always true that you need to stay in your home for 2 more years to make a refinance a good idea. A mortgage advisor can analyze the amount of time you need to remain in your house to recoup the refinance charges and determine if it is the best plan for you right now. Let me know if you need the name of a trusted mortgage advisor – I have several.
*Interest rates used in these examples are fictional and for illustration purposes only and do not indicate any advertisement of an interest rate, please contact your lender to further discuss current rate information.
Many homeowners are not deciding to sell in this current market, but instead are looking at updating or upgrading their current homes. When upgrading, home owners should seek features that aren’t only desirable to them but also what will add value to the home when it comes time for resale.
Colby Sambrotto, one of the founders and former COO of ForSaleByOwner.com recently spent six months trying to sell his condominium himself through online listings and classified ads before turning over the condo listing to a New York broker. The broker told Sambrotto that he had actually priced the condo too low and was not attracting the right buyer for the condo. At first Sambrotto would not let the broker increase the price, but finally gave in. The condo soon attracted multiple offers and ended up closing recently for $150,000 more than the original asking price and Sambrotto paid a 6% commission on the $2.15 million sale. While this story is very ironic, it details a typical scenario that happens everyday.
Expansive Soils + Heat – Water = Moving Foundations. I have heard more than usual people talking about foundation issues and I have heard that foundation companies are extremely busy right now. So I just wanted to take a few minutes to share some information on the subject. I am certainly no expert in foundations, but I do talk to and meet with experts and learn things in my line of work from time to time and just thought I would share them. Please consult with true experts if you have additional questions or concerns.
Wise consumers are fleeing the insecurity of the adjustable rate mortgage (ARM) loan for fixed-rate loans. According to the latest mortgage application data from the Mortgage Bankers Association (MBA), borrowers are clearly choosing fixed-rate loans over adjustable rate loans – less than 7 percent of the total applications were for adjustable-rate loans. That leaves the vast majority of borrowers, whether refinancing or getting a new loan, choosing a fixed-rate loan for their purchase or refinance. Borrowers choosing fixed-rate loans will typically select a 30-year fixed-rate mortgage, but depending on your situation and needs, it could save you thousands to also “run the numbers” on a 15-year loan.