One of the most important decisions a home owner who has decided to sell their home can make is what the list price of the home should be. Emotions, financial strains, and decisions based on inaccurate or misunderstood information can lead to a disappointing and frustrating sales process.
In an article published by Realtor.com, Cathie Ericson helps debunk home pricing myths that might have home sellers hung up on their list price. Reviewing these myths and understanding the truth about the pricing, listing and hopefully selling a home will help sellers start out on the right foot.
One myth sellers may believe that if a home is overpriced, it can just be lowered later without any negative effects. As Ericson points out, lowering a price is not a quick and easy fix. Many house hunters notice when a home has been on the market for a while and know when there have been numerous price reductions. As she states, “… buyers presume that something must be wrong with it. As such, they might still steer clear, or offer even less than the price you’re now asking.”
When deciding on a listing price, sellers may be turned off by the idea of pricing their home too low, assuming they will not make as much money in the sale. However, low priced homes might just attract more buyers and the increased interest in the home might result in a bidding war.
The article details the truth behind other myths such as recouping 100% of the cost of home renovations, the real estate agent’s stake in the pricing strategy and the whether all home owners make money on the sale of their home. Read the entire article.
It seems that almost daily we read or hear reports and warnings of scams aimed at consumers which can result in significant financial losses. It is imperative that consumers remain vigilant in protecting their assets and investments; especially in the age of hacking, privacy breaches, robo-calling and phishing scams. It can be overwhelming to keep up with the warnings; however, a recent article published by U.S. News and World Report by Devon Thorsby offers some sound and easy to follow advice.
For homeowners and prospective homeowners, down payments sent via wire transfers have ended up in the hands of high tech thieves instead of their mortgage companies. Emails sent from mortgage brokers to their clients with wire transfer instructions can get intercepted by hackers. The hackers are then able to change the wire instructions in the e mail prior to the customer receiving the message. In the end, the customer receives an e mail with modified wire instructions and then ends up wiring the funds meant for a home closing directly to the hackers account.
To avoid this type of scam, one broker indicated “she instructs all of her clients to have the title company and bank communicate directly…and verify where the money is going, what the value number is and what the account number is… in any other situation where you have to authorize your bank or title company to do anything, rather than scanning and emailing any personal information or signed authorization, [she] instructs clients to send it via fax to eliminate the possibility of theft from an email hack.”
Thorsby provides additional advice to avoid telephone phishing scams that can result in financial hardships.
Read the entire article.
The debate over why households choose renting over purchasing a home in the United States has been a hot topic lately. Analysts have indicated the young generation of millennials are not interested in being tied down to home ownership and prefer renting over buying. However, an article published by CNN by Daniel B. Kline, points out that it is not just millennials who are opting to rent instead of making a home purchase. Kline also notes that the decision to rent may not be a lifestyle choice, but a financially driven decision.
It is true that the number of households renting a home has increased over the past decade; almost by 10 million. It is also true that 65 percent of household headed by those 35 years old and younger rent their homes. However, it’s the heads of households aged 35-44 that made the biggest increase over the past decade. In this age group, “the percentage of renters jumped from 31% in 2006 to 41% in 2016”. Heads of households between 45-65 renting homes also increased over the past decade.
However, these households may not all be renting based on lifestyle choices. In fact, research indicates that many who rent homes would actually like to purchase a home someday. Further, surveys show that 65% of renters indicated that they are renting homes due to circumstances, not purely by choice. Circumstances such as increased home prices and tougher mortgage standards may be partially to blame.
Read the entire article.
Photo Credit: Mark Moz
The low inventory of homes for sale is causing some real estate companies to panic a bit. The number of homes for sale March 2017 compared to March 2016 fell seven percent according to the National Association of Realtors. In an article published by CNBC by Dian Olick, she quotes Glenn Kelman, CEO of Seattle-based Redfin, a real estate firm, “”The inventory is reaching historic lows. It’s never declined faster than it did last month. It’s freaking us out — it’s affecting our business; it’s limiting our sales.”
The cause of this low inventory issue can be attributed to a few factors. To begin, many homeowners are deciding to become landlords. Instead of selling a home when moving on, homeowners are holding on to their home and renting it out. Another reason is new home construction is declining. On average, home builders are building about 18 percent fewer homes than the historic average.
The good news for home owners looking to sell, homes are selling quickly and some are even selling above list price. Homes in April 2016 went under contract in 50 days, as of April 2017, that number decreased to 40 days.
Read the entire article.
House hunters looking to purchase their first or next home are, undoubtedly, looking for a good deal on the home and a sales transaction void of big surprises or delays. It can be exhausting to get into back and forth negotiations over price. Not to mention potential discoveries in an inspection that need to be agreed upon before the sale moves forward. It can appear, at times, that the home owner is not in any hurry to sell their home and is not willing to budge on their conditions.
In an article by Stephanie Booth, published by realtor.com, she provides seven signs that a homeowner is anxious to sell their home quickly and willing to work out a good deal with a prospective buyer. For example, a home that is listed for sale by an estate might be a sign that the home can be purchased for a bargain price and be a candidate for a quick sale; the people who inherited the home might be out of town residents and/or looking to quickly liquidate the assets of the home.
Similarly, homes that appear to need some minor work such as landscaping and basic maintenance and are overall, just not spruced up to attract buyers, may indicate distress for the homeowner. They may not have the means or resources to make minor repairs or updates to the home and are just looking to move on. A home buyer might find an offer to be quickly accepted and be able to negotiate a quick close with a homeowner motivated to unload the burden of owning a home they can no longer afford to maintain.
Read the entire article for other signs that a home owner is desperate to sell their home.
Some promising real estate sales information for Chicago and its surrounding suburb’s was released by Crain’s recently. The analysis included the actual number of homes sold, the median price of the homes that sold and the average time to sell compared to those same statistics from quarter one of 2016.
Rising to the top of the list for single family homes sold in Chicago was the Irving Park neighborhood. According to the article in Crain’s, written by Dennis Rodkin, “Irving Park’s volume of sales is up 6.6 percent, to 66 sales, and the median price sale price rose 8.6 percent, to $505,000. Houses sold 14 percent faster than a year ago, in an average of 102 days.”
Suburbs such as Glendale Heights, Oak Lawn and Joliet reported impressive increase in homes sales, significant rise in median price and a marked decrease in the time the homes spent on the market before receiving an offer. Specifically, Glendale Heights’ sales increased 4.8 percent and the median price rose 9.4 percent compared to the first quarter of 2016.
Read the entire article to see sales data for other Chicago neighborhoods and suburbs showing growth and improvement from last year.
Photo Credit: Sheila Scarborough
As the season of spring begins to bloom all around us, so it goes for the spring real estate market. Many homeowners see spring as the perfect time to put their homes up for sale. As prospective home buyers begin their search for their first or next home, they may find that homes aren’t sitting on the market nearly as long as they have been in the past several months.
A recent report provided by a national real estate firm, Redfin, indicates that despite the fact the number of homes for sale has dipped 13 percent from last year at this time, actual home sales has surged 9 percent. Additionally, the number of days until the average home goes under contract has decreased by 11 days since last March, dropping to just 49 days. Lower inventory and fast paced home sales has also driven up the prices of home an average of 7.5 percent.
A CNBC article written by Diana Olick, goes on to detail that not only homeowners are benefiting from a spring jump start. Builders are also tracking a home sales increase of 6.7 percent from last year. However, new home prices have remained virtually unchanged. Olick suggests, this “…may indicate builders are trying to keep prices down in order to get more buyers in the door.”
Home buyers are looking to take advantage of the low mortgage rates and their desire to close the deal has resulted in some very favorable news for those looking to sell their homes.
Read the entire article.
Photo Credit: Guy Kilroy
The home improvement shows make it look so easy. It appears that as long as you can find an old, run-down house, you can spend a few weeks renovating it and list it for a profit. Many people realize, however, it is usually not that easy. Nevertheless, there is a market for flipping renovated homes and flipping these home can be profitable.
It is important, though, to understand the ins and outs of purchasing an old, dilapidated home and attempting to fix it up for resale. In an article published by Realtor.com, writer Lisa Gordon lists many of common mistakes made by first time home flippers.
For example, it might be tempting to purchase a home “as is” without getting a home inspection since the plan is to fix it up anyway. However, the home inspection will not only help identify major issues that could turn your flip into a money pit; it might also provide some bargaining power on the purchase price.
Gordon goes on to list additional mistakes such as “Overestimating your renovation skills” and “Underestimating total costs”. You may feel it will be easy enough to do all of the work on your own, in order to save money; yet, the article warns, it might be well worth the extra cost to hire professionals for some of the plumbing or carpentry projects.
Read the entire article.
Photo Credit: Bev Sykes
On Wednesday, the Federal Reserve governors decided to increase the interest rate by .25 percent. According to an article written by Amber Tuaufen, published by inman.com, “The Federal Reserve sets the rate for the overnight exchange of money by banks; governors adjust the rate to help curb inflation or stimulate growth, depending on their assessment of what would be best for the economy.”
Despite the fact that this move does not directly affect the mortgage rates, it can have an impact on the rates for mortgages. In fact, an increase in mortgage rates has been anticipated for quite some time now. Many prospective home buyers have been advised that the historically low interest rates were coming to an end; however, rates continued remain low. Many buyers may not have felt pressure to move forward with a home purchase, leading to sluggish sales. It would appear, now, the rates are indeed going to begin to increase.
This potential increase of mortgage rates could have some negative impact on home sales. Yet, some agents feel that the continued affordability of housing coupled with the steady increase of rates could put pressure on prospective home buyers to make a decision and not delay their home purchase any longer.
Read the entire article.
Photo Credit: Svilen Milev
The end of 2016 is just a matter of weeks away and, just as we have come to expect this time of the year, real estate analysts have begun making predictions about what could be in store for the 2017 real estate market. Many of these professionals and experts have similar expectations for the upcoming new year; some are based on anticipated changes that may be be ushered in as our new president takes office in January.
Housingwire.com journalist, Kelsey Ramirez, published a list of predictions made by Zillow. Among the expectations for the 2017 real estate market that made this list: increased development of smaller homes located closer to urban areas with access to public transportation, an increased of number of millennials purchasing homes, an increase in the affordability of renting, and an increase in the cost of building homes.
Another Housingwire.com article written by Ben Lane details some predictions made by Redfin. Lane indicates, “according to a new report from Redfin, homes will fly off the market in 2017, faster than any other year on record.” Another prediction on the Redfin list is an expectation that the housing market growth will continue, but at a slower pace than we saw in 2016. The company also predicts an increase in mortgage rates, yet do not expect a significant increase.
Read the entire article and find links to additional 2017 predictions.