At this point in time, there is a great deal of opinion and speculation about where the real estate market is headed going forward. Many articles written in the financial press suggest that market prices are overextended and due for a correction, after a number of years of increases. This argument is primarily based on the fact that interest rates have been historically low and have allowed more buyers to enter the market along with lower mortgage payments.

This has led to additional demand at all levels and prices have moved steadily upward as a result. However, the Bank of Canada is concerned about the onset of inflation in general, and is advocating higher interest rates in order to counterbalance inflation and keep the economy as even as possible.  As interest rates rise and mortgage renewals become due, the monthly payments go up.

Since many homeowners have higher debt levels than what is considered normal, this could mean trouble servicing this debt and thus have a dampening effect on market prices!

Here are seven reasons why you should really pay attention to price when selling your home:

1. Save Money:

When a home sells faster, it saves carrying charges, mortgage payments, and other home related costs.

2. Less Inconvenience:

It takes time and energy to prepare for showings, keep your home clean, make child and pet arrangements, and change your daily routine.

3. Exposure to More Prospects:

At the correct price range, your home is available to more people who can afford the price.

4. Increase the rate of response by Real Estate brokers:

When real estate brokers are excited about a home and its price, they make an extra effort to bring it to their client’s attention.

5. Better Response from Advertising:

Advertized properties will turn into showings when price is not a deterrent.

6. Attracts Higher Offers:

When a home is priced right, buyers are less likely to make a low offer because they don’t want to lose a good home.

7. Make More Money:

If a home is priced correctly, the excitement of the market can produce a higher net sale as well as reduce your overall costs.

This is why it is very important to have a complete real estate appraisal done by a professional who also understands what buyers want and in most cases, what they are willing to pay.
 

Image: Michal Marcol / FreeDigitalPhotos.net

Although the process to get ready to sell your home may seem like common sense, it is worthwhile to keep a checklist of things to do. With careful planning and a little work you can turn your house into an irresistible and marketable home.

A buyer’s attention is naturally drawn to something that’s not quite right so start with the obvious repairs such as a cracked tile, paint touch-ups, a burned out light bulb, etc.

• Are the mechanical and electrical systems working efficiently
• Is the powder room fan making noise
• Has the furnace been serviced regularly
• Are the electrical outlets functioning properly
• Is the sump pump in good working condition

If in doubt, call the serviceman!

Organize and make sure you de-clutter. Make rooms more spacious by removing what is not needed. Buyers like to “picture” themselves in the home. So when someone visits, if possible put personal items aside such as family pictures. Clean up the basement and the garage and neatly store possessions not being used such as Christmas decorations in a designated area. Take some time to recycle, throw out or donate things that are not going to be used again. This will also make your eventual move much easier.

The outside is every bit as important! Create curb appeal by giving your house an inviting look that makes the prospective buyer want to stop and see the inside of your house.

• Keep your yard manicured
• Keep driveway and walkways free of dust and debris
• Are there a loose shingles
• Are the eaves troughs flowing freely
• Does the wood deck need refreshing

Don’t forget the senses! Flowers and pleasant background music – to appeal to the senses! Remember, you don’t get a second chance to make a good first impression.

Not only are there a number of factors that will work against this tactic but it might also place you at a distinct disadvantage!

Here are a few reasons why you should consider using a professional to sell your home:

• One of the most compelling reasons is the evidence that over 97% of sales are completed through real estate brokers which leaves less than 3% of the market available for private sales.

• Potential buyers looking at these private sales are searching for and expecting a bargain price! – These “bargain hunters” are those that usually do their homework and undercut the market, sometimes considerably! – And part of the bargain is to discount an agent’s commission as well!

• Qualifying a potential buyer is an important part of an agent’s responsibility: if a buyer does not have capability, why should he visit your house!

• An agent also has the advantage of negotiating objectively on a homeowner’s behalf – the agent completes a substantiated market study that indicates price range and the correct position in the marketplace.

• When selling your own home, it is often difficult not to get involved emotionally which is understandable since most grow emotionally attached to their home. An agent can help you objectively evaluate the situation and provide valuable unbiased advice.

• Preparation, marketing, networking, – a “professional” agent has the inside track and can provide your home more exposure than if you sell it on your own!

• Correct paper-work, inspections, notary, rules and regulations – a “knowledgeable” agent can prove to be invaluable!

When selling your home, you’ll want to be sure your investment is well represented. Using a professional real estate broker is certainly worth it, considering the time and effort they can save you and the expertise they can bring to the sale of your home.

Timing real estate is as difficult as trying to time stock or commodity markets. Buying real estate as an investment in the quality of one’s life could help diminish hesitation. Finding the right home at its fair market value once financial and personal affairs are in order becomes the goal. A five year plan would make market fluctuations feel less threatening. Future price movements are always unpredictable and best left to the speculators.

The situation is different for a homeowner who wants to sell and buy another property. Since the transactions would usually be in the same general time frame, the relative price fluctuations would be at a minimum. The issue becomes – does the home go on the market before or after finding the next one? What happens if the present home sells before finding the next one or if the next one was found first? There isn’t a perfect answer, but not too many can finance two properties at once and many homeowners are reluctant to accept “conditional offers”.

It therefore would seem logical, if the mind is made up, to place the home on the market and make plans for the interim period if a desirable home has not been found before, or can’t be co-ordinated with, the closing of the first sale at the notary.

In the case where a desirable home is found first perhaps the homeowners will accommodate this ‘condition’ if they see good preparation – seeing the bank perhaps for some carry-over financing for a set period and seeing that the home is presenting itself well and attracting attention. An accepted conditional offer gives a potential purchaser a short period of time either to back away or commit financially to the purchase, in the case where another legitimate offer is made on the home. There is always a degree of uncertainty, but it can work out quite well when the objectives remain organized and steadfast.

A downtown city condo far out prices a similar condo in an outlying suburban setting. An established area of single family houses in the suburbs demands higher prices than similar houses in a village setting outside the metropolitan area.  Chances are what is perceived to be the ‘best’ location in a given area generally costs more as well!

Today’s location, whatever that ends up being, may not be tomorrow’s in terms of re-sale value and market trends, so individual priorities become most important. Someone may have her heart set on an older modest farmhouse on an out-of-the-way country road, and while it may not follow a standard comparable definition of ‘location’, it may represent the perfect location for different reasons. If there is a future need to sell, maybe it may take longer than a more populated area for example, but this might be an easy compromise because she is achieving her desired lifestyle, and that is her priority.

Within a larger community there are always areas of similar priced homes or homes that are closer to the centre of town or ‘family’ areas closer to schools and parks. Finding one’s price range and desired lifestyle become the important factors in choosing the area within the larger community, – in other words the best ‘location’ for you and your family. Each area has its own set of characteristics that separates it from the others. Some of these may be o.k. and maybe some aren’t; – perhaps a particular area is enclosed to the point where only local traffic uses the streets – this is good! – on the other hand, perhaps there is a high water table that could cause a potential problem come spring – this is not so good! You want to know about the neighbourhood and if all the factors that make up its location do indeed meet your personal priorities!

To answer this all important question requires a logical and statistical study of the current marketplace where homes are being bought and sold. You don’t need opinion, you need substantiated facts concerning the state of the market and how your property fits in.  Appraisals by banks and insurance companies don’t really tell the tale because they are concerned with their own markets, namely – making sure mortgage and insurance values are covered.

To accomplish the answer requires a real estate appraisal done by a knowledgeable real estate agent, willing to take the time and show you on paper what your property’s “market value” range is and also to suggest a reasonable “asking price”, so as to invite a potential purchaser.

Determining this ‘market value’ clearly has its advantages. Knowledgeable homebuyers out there looking along with their agents will recognize that your agent has asked on your behalf, a price that is in keeping with a fair value for your home, and this invariably leads to a quicker sale at a higher price for you and your family.

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