Are Buyers Really in the Market?

The answer may surprise you, but yes!  Many buyers choose the Christmas Holiday Season to relocate from other states or move in general because they have more time off from work and can do so.   These buyers are normally pretty serious and are looking for a transaction that will be smooth and close on time.   Will it be your home?   Be ready and available to approve showings- you never know if your home will be the next one sold.

If you would like to find out more about what makes our real estate team different here in this Raleigh Real Estate Marketplace feel free to give us a call at 919-235-6301.

If you have any other questions about updating your home, please feel free to give Linda a  call at 919.235.0007.

Do you have any ideas or tips that you could offer?   We always welcome your feedback.   If you or anyone you know is interested in finding out what the next step would be to sell your home in the Greater Raleigh Area, please feel free to call our office at 919.235.0007.  We would love the opportunity to assist you.

 7 Deadly Sins of Overpricing

Most experts would advise that the best way to increase your odds of a successful sale is to price your home at fair market value. But, as logical as this advice sounds, for many sellers it is still tempting to tack a few percentage points onto the price to “leave room to negotiate”. To avoid this temptation, let’s take a look at the seven deadly sins of overpricing:

1. Appraisal Problems

Even if you do find a buyer willing to pay an inflated price, the fact is over 90% of buyers use some kind of financing to pay for their home purchase. If your home won’t appraise for the purchase price the sale will likely fail.

2. No Showings

Today’s sophisticated home buyers are well educated about the real estate market. If your home is overpriced they won’t bother looking at it, let alone make you an offer.

3. Branding Problems

When a new listing hits the market, every agent quickly checks the property out to see if it’s a good fit for their clients. If your home is branded as “overpriced”, reigniting interest may take drastic measures.

4. Selling the Competition

Overpricing helps your competition. How? You make their lower prices seem like bargains. Nothing is worse than watching your neighbors put up a sold sign.

5. Stagnation

The longer your home sits on the market, the more likely it is to become stigmatized or stale. Have you ever seen a property that seems to be perpetually for sale? Do you ever wonder – What’s wrong with that house?

6. Tougher Negotiations

Buyers who do view your home may negotiate harder because the home has been on the market for a longer period of time and because it is overpriced compared to the competition.

7. Lost Opportunities

You will lose a percentage of buyers who are outside of your price point. These are buyers who are looking in the price range that the home will eventually sell for but don’t see the home because the price is above their pre-set budget.

Most buyers look at 10-15 homes before making a buying decision. Because of this, setting a competitive price relative to the competition is an essential component to a successful marketing strategy.

If you have questions about pricing  your home correctly in today’s Greater Raleigh Area Real Estate Marketplace feel free to give me a call at 919-235-0007.

Have a great week,

Linda

So the Real Question Is: What’s Normal?

To better understand client expectations I asked that question recently on our Linda Craft Team Facebook fan page and read a lot of different numbers from our fans. This told me most people do not know what to expect when they are trying to sell their home and are not sure of what a  normal expectation would be.

I Have A Confession:  I am a Numbers Junkie.  

I love looking at stats and comparing our results to them. So to find truth, determine normal, and set realistic expectations I went into CSS Centralized Showing Service and took a look at their February 2011 numbers for resale housing. (No new construction) CSS schedules all appointments for all Triangle Real Estate Firms.

For the month of February they scheduled 36,574 appointments on 9,809 active  re-sale listings. That’s a lot of appointments and a lot of REALTORS and buyers walking through front doors.

However, it only equals 3.72 showings per listing, per month.

I was quite surprised to read that number because I always tell my sellers to expect 2 showings per week. This is because my listing inventory here in the Raleigh, Cary, Wake Forest, Garner, Apex, Holly Springs and Knightdale areas averages 8.45 showings per month. My clients know that I religiously track this every week and can compare current time to any previous month or year. Did I mention I am a numbers junkie?

I always say feelings may change but, numbers never lie.

Another interesting number from the National Association of  REALTORS is for every 10 showings you should have one offer.  This is another good reason why your home must always be priced right and really stand out despite the competition.

If you want to talk about this further feel free to call me at 919-235-0007 or emailing me at linda@lindacraft.com

Have a great rest of your day!

Linda

Every market has seasonal trends for home buying. The North Carolina mountains, beaches even big events like the Super Bowl or the NHL All Star Game can influence a seasonal buying trend. However, in the Greater Raleigh Area our traditional trend in home buying spikes up in April, May, June, July and early August.  This is due mostly to families with children trying to settle in before Wake County Schools begin.

We see home buying demand increase again in October, November and December. The Fall months are busy due to the annual Parade of Homes and many people wanting to settle into a new home for the holidays or get a tax write off before the year ends.

What Are The Slowest Months of the Year for Buying or Selling a Home?

Traditionally the slowest home buying months in Raleigh area  are January and February.

When Is The Cheapest Time of the Year to Buy a Home?

A factor that will always effect home buying trends are interest rates. When interest rates drop this gets more buyers thinking about real estate and when they inch up it always drives more buyers to take action.  

Isn’t it interesting that so many buyers miss the lowest interest rates because they wait hoping they will get better?

Perhaps a solution would be to purchase a home with a lender that will allow you one free rate drop during the process. Then you have a safety net if rates drop again or if they go up you will be happy you did not procrastinate. At present interest rates are the lowest they have been in 40 years. A rise of 1% in an interest rate is like paying 10% more for the same house. Don’t wait it is a great time to buy real estate. It is on sale and interest rates are low low low.

What is the Bottom Line, Linda?

To quickly summarize generic, predictable trends that happen every year regardless of interest rates or big city seasonal events: Families tend to move in the summer, first time buyers purchase before weddings and holidays, investors buy good deals year round but, traditionally see more out shopping in the winter when home buyer compettition will be a little lower. To see every home for sale in the Triangle area including Raleigh home rentals, foreclosures, short sales, new homes and resales visit our Raleigh Real Estate Website, www.LindaCraft.com

If I can answer any questions for you about the greater Raleigh area real estate market please give me a call. I have sold over 5,000 homes, am investor certified and a distressed property expert. If you have questions I have answers. Feel free to call me at 919-235-0007 or email  Linda@lindacraft.com

Have a great day!

Linda

Game #1 I Want What I Want

This mathematical game is where delusional home seller looks at how much they paid, everything they have spent on the home over the years, the sales commissions other cost associated with the sale, plus the profit they dream of making and that is their price. They will win the price is right game someday but, it could take 20 years

Game #2 I Want What I Need

Similar to “I want what I want” except this seller doesn’t look at past expenses they focus on real need. I owe x, it will cost me x to sell therefore x plus x is the price I need. This seems like a real deal until you realize the first x included a refinance or a home equity loan that was spent on credit cards, cars and beach houses. 

Game #3 Two Wrongs Don’t Make a Right

The Tax assessor has valued my home at X so this is where I want to price my home. The tax assessor valued your real estate at a number to base a charge on. A tax charge to you. Not a credit. In 2010 the average sales price to tax value was 85%. Ask your tax assessor if he wants to buy your home at his price.

Game #4 I Like My House Better Than Your House

I like my kids better than your kids, I like my dog better than your dog, of course you like your house better than any other comparable properties! Duh!  It’s your house- you should love it.  But, you are not buying your are selling. The question is what does a buyer like better? The buyer doesn’t have your years of memories. They are comparing to commodities and they will not pay you more because you like yours more.

Game #5 Value-in-Use

I literally have people try to convince me that their house should be worth 10% more because they have more upgrades. 3 piece crown molding instead of 2, upgraded light fixtures, upgraded cabinet finish, painted garage, upgraded carpet and pad, larger deck, etc. Somehow they confuse what the builder personally charged them for upgrades as real value. They hope that expense financed over 30 years transfers as a credit on the sale and also appreciates in value. When you buy a new home the upgrades you add are double the real value cost. The builder is making a profit so you can have value-in-use. Those upgrades of yesterday may help your home sell today but, they rarely add anything extra to your bottom line.

Game #6 The Golden Palace

You can see this Raleigh area home seller a mile away because he is carrying a truck load of receipts to his listing appointment. Excel Spread sheets and files full of receipts from his overpriced purchases. He has added them all up and will let the buyer have everything at 50% off. 10 years ago when the house was built he put in a $5,000 dollar chandelier when most builders only gave $1,000 credit. The custom window treatments $15,000, landscaping over the years added up to $25,000 and his bath fixtures….gold plated. The window treatments are out of style, the chandelier is just plain ugly, the landscaping died and was replaced 2 times and gold plated…Are you kidding me? You will have to reduce your price 50% just to get the buyer to put up with your palace.

Game #7 Lady Luck is not so Lucky

So your roof leaked, air conditioning went stopped working  along with the water heater, dishwasher and disposal. The kids and dogs trashed the carpet so you replaced it last year. The total expenses in the past couple of years was $22,000. Nope, you can’t list your house for $22,00 more than your neighbors who haven’t replaced anything. Yes, theoretically the buyer is getting a longer insurance policy against future expenses but, they will only pay a fraction for lady luck

Game #8 My Dad is Bigger than your Dad

We started playing this game at 5 and even at 55 we are tempted to play it again when it comes to Raleigh real estate. It goes like this…Yes but, my lot is bigger, yes but, I have more square feet. It is amazing to me how many people believe if one sold property had a lot size of a 1/2 acre and they have an one acre their house will sell for more. The size of your lot is not an indication of value. And, square feet, oh my, doesn’t this one cause controversy. All square feet is not equal. Let me repeat, all square feet is not equal. You will not get the same value for attic and basement as the first floor. You will not get the same value per square feet if the room counts are the same. You will not get value for wasted square feet. Tax value square feet is wrong 90% of the time. So many sellers try to price it right by calculating average price per square foot times their total square feet. This is a sure fire way to price it totally wrong

Game #9 Don’t Put Off Till Tomorrow What You Could Do Today

Many sellers spend money preparing their home to sell and they confuse the cost of deferred maintenance with added value. If your house needed to be painted 3 years ago but, you didn’t do it the fact that you are repairing wood rot and painting now is not to make is saleable is not an added value. It is neglected home maintenance that is desperately needed and if you do not do it now your house will sell for 3 to 4 times less the cost of the maintenance. Deferred maintenance cost cannot be added to your list price. The buyer is not going to pay your for maintenance that you should have done 3 years ago. Sorry

Game #10 The Price is Right

You will always know when the price is right because a buyer will appear. Finding the right price is not a game of luck, chance, or denial. It takes years of experience and the ability to remove emotion from the formulas and methodologies most sellers want to use. And, sometimes it takes bravery to hit sellers between the eyes with the truth.  The buyer has always determined value. Yesterday I had a seller tell me her house was cuter than the other one in the neighborhood. It was the exact same floor plan and she wanted $25,000 more for her cute house. The only difference was the shutter color and her house was closer to a busy road but, she didn’t want to look at that. She was is Disneyland which is a fun place to visit but, you’re not going to buy it.

If you are thinking about selling your home now or in the future and want a REALTOR to hit you between the eyes with the truth about pricing it right please give me a call at 919.235.0007. I always say; “The truth will set you free but, first it hurts like crazy”. If you want your house sold, and not just listed, you need to hear the truth.

Buyers come in all price ranges and seek a wide variety of housing options and amenities. There are so many choices in the market that buyers shop to eliminate instead of buy. Here is what commonly happens in our market:

Home Buyers Want To Eliminate Each House They View Rather Than Choose It.

Sounds odd…..here is how it works:

Today’s buyer has a lot of choices, and therefore will look at as many houses as their house hunting time will allow.  As they view each house they look for reasons to eliminate it from their list. They may feel the house needs too much work, appears to be too small, or maybe they don’t like the seller’s choice in wallpaper or paint.  Even if the house is a good fit for their family and the reason for elimination is an easy fix, they have a tendency to remove it from their list and continue their search for the “Perfect House,” the one where they don’t have to do anything but turn the key to their new home.

As a professional REALTOR, part of my job is to “help my seller’s home become easier to buy instead of being eliminated.”  Staging the house in a way that is bright, cheerful and inviting will help keep it on the buyer’s list.  It is not that hard to identify potential items a buyer may find as a reason to eliminate the house.  You should listen closely to the advice of your agent and/or stager, for they have the past experience to know what is objectionable and what is not.

If you have any questions, or would like a referral to a good home stager, feel free to give me a call at 919-235-0007.

I hope that you have a great weekend,

Linda

One of the things I am concerned about in this current real estate market is that home prices seem to be still dropping .  I am worried that I might only get a low ball offer.  I don’t want to have to deal with someone who is not serious enough about my home  to even make a reasonable offer.  To me, that would be so aggravating.

What are your thoughts on this?

Thanks,

Elizabeth

Dear Elizabeth,

I understand your concerns and you are not alone.  Every seller cringes at the thought of a buyer making a very low-ball offer on their home. Keep in mind it is only human nature to want the best deal possible on anything you are purchasing.  If you are presented with a low offer do not panic,instead embrace it!  Do not get upset with the offer, for a buyer, (with the exception of investors), typically only make an offer on your house if they can actually visualize themselves living in the house.  This is good news!

Consider a low offer a starting point, and keep in mind that you cannot start negotiations if there is nothing on the table to negotiate.  If buyer makes an offer on your house….let’s see what they are willing to pay.

See you soon,

Linda

Something To Consider:

Way too many offers never become contracts due to the buyer, seller and agents, allowing their emotions to get out of control.  As a professional REALTOR with experience in negotiations and communications I know that self control is your best bet for achieving a successful transaction. Posturing is part of all negotiations. I always tell my sellers I would rather have a low offer to begin negotiations than no offers at all. It is amazing after the first round of counters how quickly a low offer will get in the game and become a win for the seller. Don’t worry about low offers, worry about no offers. Negotiations are fun and exciting.  If you have any questions about your home or the real estate selling process here in the Greater Raleigh area, please don’t hesitate to email me at linda@lindacraft.com.

Hope you have  a great day!

Linda

Mistakes Home Sellers Make

1. Delusional Thinking

“My home is special, I WANT to sell,  I need to net, It’s sold as is! “  When these words come out of a sellers mouth I know they have delusional thinking are headed towards bitter disappointment. My job is to first save them from themselves by educating them to the differences of a home sale instead of a home listing. Many REALTORS will list homes for sale following the requests of the seller instead of educating them to how to be in the market and sold instead of just listed.  There is a huge difference between being “in” the market or “on” the market. Delusional sellers look for magic pills and hope time will be their cure all. 6 months later their house isn’t sold and the search begins for another REALTOR to work magic. Sellers with delusional thinking place houses on the market instead of in the market.  

For Success Change Your Thinking.

Your house will only sell if buyers think it’s special. Wanting to sell instead of needing to sell usually means Disney Land pricing- be careful with that thinking. Pricing you home with what you want to net instead of  market value is like buying your house back every day it’s on the market. It will never sell if your net doesn’t match market value. Sold “as is” happens all the time with distressed properties at very discounted prices. “As is’ guarantees one of two things either a low price or no sale at all. Is that what you want?

2. Pricing With The End In Mind

I can’t tell you how many times I have heard “I need to net X to have enough money to buy the type of house I want”.  The market is, what the market is. I do not know any REALTOR who can make a buyer give a seller what they need in order to buy their next house. Frankly, the buyer doesn’t care what you need and is not going to help you buy your new house. They are trying to buy their own house. Hopefully yours. If you need to net X and it is higher than market value forget selling. Stay put and enjoy the home you have or alter your desires on what you purchase with your net dollars.

3. Hiring The Wrong REALTOR

A REALTOR’S  job is to educate sellers, market their home and negotiate contracts. Therefore it would make sense for sellers to focus on how much experience and exposure the REALTOR they hire can bring to them. Instead many sellers hire family friends or REALTORS who have no market reach other than a sign and MLS listing and lack experience in negotiations. Ask how many homes they closed last year, this month and how many they have under contract now. Then ask how many of them were listings and how many were buyers. Do you want to be the very first house they have ever listed for sale? Or the second, third or fourth? NO you need experience if you want success. Working with sellers  is very different than working with buyers. Seller’s agents need marketing dollars, contract negotiation skills and problem solving abilites. Does your agent qualify for the job?

4. Keeping up with the Joneses

One of the biggest mistakes I see most sellers make is pricing their home by comparing it to other houses for sale now. They say “My neighbors house is priced at X and I have better landscaping and a fence so I think my property is worth XX”.   Hello…..what if your neighbor is wrong?! Didn’t your mother tell you two wrongs do not make a right? The fact is, most of your neighbors are wrong because they have all followed this delusional thinking trap. In every market there is data to prove what percentage of neighbors are wrong. It’s called number of price reductions and expired listings. I am certain many of your neighbors are wrong.  Please, Mr. and Ms. Seller, I beg you to look at sold and under contract properties. Not what’s for sale now.

5. Eliminating The Appraiser From The Equation

This may be the most overlooked, under estimated, dangerous mistake a seller makes. It doesn’t matter what you want for your home, or what a REALTOR thinks it is worth, or even what a buyer is willing to pay….if there are no recent comps to support the agreed price it is not going to appraise and you will lose your sale 99.9% of the time. Appraisal guidelines have really changed. They look for comps that have sold and closed in the past 90 days. If there are good comps they use them. If there are no comps they may go back 6 months. However, the times of them going back a year or two and justifying a sales price is over. Appraisers are chosen by lottery, comps have to be the most recent, they also have to include under contract, short sales and foreclosures sales in their report. All appraisals go under a second review by the mortgage companies underwriter before acceptance. No appraiser is sticking their neck out. If the comps say X and your contract is at XX your appraisal comes in low which reduces the amount your buyer can finance and the deal goes south. When you list you home for sale begin by looking at closed properties within the past 90 days just the way an appraiser will. If concessions were paid you must reduce that amount from the sales price too. Adjustments are made for differences such as no garage verses 2 car garage. Your REALTOR can help you understand the adjustments in the comparable properties. Age, square feet and location are the big 3 factors. Upgrades help a house to sell when competing in the beauty contest against other home choices but, do not necessarily help appraised value when it comes to mortgage companies lending money.

If you are considering selling your home in the Greater Raleigh Area please know that the days of inviting a REALTOR to sit at your kitchen table telling you what you want to hear so they get you to list with them is over. A successful sale today begins with a listing consultation in the REALTORS office where you can see the most recent sales in detail the way an appraiser does, study other sellers who failed to sell and why.   Do not make the same mistake as others, look at your competition through buyers eyes, see first hand the marketing you are paying for and make a good business decision about selling your home in the current market. If this consultation shows sales in a range that will give you the net you want your odds of selling are very high and you should jump into the market. If the numbers do not make sense for you to sell now, wait. Real Estate always goes up in value over time.

For a free seller consultation contact me through my Raleigh homes website or call 919.235.0007.

Hope you have a great Monday!

Linda