Expert Advice on Buying and Selling Homes
You most likely have many questions about buying or selling your home... many more than we could list in this section. Real Estate Agents at Old South Realty are standing by to help you with professional advice about buying or selling your home. Contact us today!
1What is Earnest Money?
The larger the deposit a buyer makes, the more serious and committed the buyer is and the better you should feel. On the other hand a small deposit, or worse, a promissory note, may indicate a buyer's unwillingness to fully commit. Decide in advance what you feel is an appropriate earnest money deposit relative to the price of your home. In many markets, this may be 1%-2% of the sale price, but it can also be much, much more.
2What is a Pre-Approved Loan?
A letter of pre-approval states that the buyer has been qualified to purchase the home based on the information they have provided the lender at the time of the loan application. This doesn't mean they are fully approved, as the lender still has to verify assets and liabilities, run a credit report, and verify income, employment, and residency, but it does provide a sense that the buyer is a legitimate prospect.
3Time-limits for Condition and Contingency Removal
A condition or contingency that has not been satisfied means that the buyer still has an opportunity to back out of the sale, potentially without penalty, all the way until the day of closing. The trouble is a buyer who has open ended condition, and one that they can use as an excuse to exit the sale without penalty, may decide during a sudden panic attack that they should bail out of the sale. To prevent this, wise sellers require that conditions and contingencies be removed as quickly as possible.
4Tracking the Sales Process
In a real estate transaction how do you know that the sale is progressing forward? If you're using a poorly written real estate contract you might not know if the sale is moving forward, backward, or sideways. What you're missing are benchmarks, beacons of hope that signal that your transaction is flying in the right direction and that you are on course for a successful landing. Thankfully, many standard real estate agreements have built in benchmarks, like requiring the buyer to submit an application by a specific deadline, or requiring the buyer to approve the preliminary title report by a certain deadline.
5Clearly Understandable Terms of Sale
The first question to ask yourself while studying the offer is this: Could someone not in the real estate business understand this agreement? A poorly written sale agreement allows room for interpretation. Successful sellers reduce the risk of an offer failing by working with a highly qualified real estate agent or real estate attorney to create agreements that are clearly understood by all parties in the transaction.
Why Hire an Agent?
An agent will be able to provide detailed market information about the overall market, your neighborhood, and your specific home that will be crucial to targeting the right price and marketing strategy to attract a buyer quickly.
A good listing agent will tell you not only what buyers will love about your current abode but what will turn buyers off as well. For instance green shag carpet is out but colorful walls are in. The ability to provide a critique of your home's curb appeal and help with home staging tips can be crucial to building a good first impression with buyers.
Agents are trained to pick up on key features that will set your home apart from the competition. Building on these focus points, they can structure a multi-media marketing approach to finding a buyer using their economy scale (advertising multiple properties) that will be hard to match as an individual homeowner.
The biggest advantage of using a listing agent is often the dramatically increased exposure that an agent provides through the Multiple Listing Service and web marketing strategies. As typically over half of all listings are sold by co-operating brokers, when you work with a listing agent you are actually tapping into the buyer inventory of every agent in your community.
A listing agent provides sellers with an emotional buffer between themselves and the potential buyer. This often makes negotiating a sale easier and more profitable for the homeowner as it's far easier to reject or counter offers through a third party rather than face to face when selling on your own.
Home Improvement Myths
1Any remodeling project will add value to your home
Not true - while many remodeling projects will add value to your home, some can be seen as a negative by future buyers. For instance, combining two smaller bedrooms to create one larger bedroom may better fit your lifestyle today, but it may cause the home to lose value in the eyes of a future buyer who needs the two separate rooms.
2Adding square footage always adds value
A better way to think about this statement is to insert the word useable into the sentence. Square footage in attics and basements that are finished, and by county standards considered livable, may not be attractive to a buyer if the space is sub-standard compared to the rest of the home.
3Buying the highest quality materials attracts more buyers
Installing the highest quality materials always seems like a wise decision, but it can backfire. For instance, using the most expensive tile in a bathroom may impress your friends, but value conscious buyers may opt for a more affordable home if you have over improved for your neighborhood.
4Inside improvements are better than outside improvements
Not necessarily. If a home buyer can't get past the exterior of your home because it has been neglected or doesn't offer good curb appeal, all of the work you have done on the inside may not net you any more dollars. To get the biggest bang for your remodeling buck, start from the outside and work your way in.
5Colors and textures - safe and simple is better
Keeping a home vanilla so that buyers can choose their own style and decor sounds like a safe bet, but it ignores the fact that most buyers just don't have the ability to visualize the home differently. Without splashes of color and mixtures of texture, you could lose value to other sellers that have taken the time to consult with an interior designer.
6Paint hides a multitude of sins
Dry rot? Fungus damage? Mold problems? Carpenter ants? Termite issues? Nothing a can of paint can't fix, right? Wrong! Not only does this practice violate disclosure laws in most states, it can set you up for liability after the sale as most buyers will want you to foot the bill for these hidden issues.
7Adding a bedroom is better than adding a bathroom
It depends on the starting point. If you only have one or two bedrooms to start with, adding a bedroom before adding a second bath is probably a wise choice since most buyers are more attracted to a three bedroom home. On the other hand, if you already have three bedrooms and only one bath, your next investment would probably be in a new bathroom.
8Swimming pool adds value to your home
This is only true if you live in areas where they are must have amenities. Be warned that this isn't true for most areas of the country and the idea of maintaining a pool for ten months out of the year when it can't be enjoyed won't appeal to most buyers.
9Converting a garage to living space is a great trade off
Nope. A garage conversion is almost always viewed negatively by future home buyers unless you replace the lost garage with another space of equal size (but then what's the point?). If you are going to do one anyway make sure that the space can be easily converted back to a garage at the time of the sale.
10Doing the work yourself will save you money
For many homeowners wiring a new lighting fixture or plumbing a new dishwasher is a no-brainer, for the rest of us it may end up costing us more later in repair costs when we have to order the work redone by a professional. Another consideration is local and state laws regarding remodeling work. In many states if you have purchased a home to remodel and resell, you must either hold a contractor's license or hire a contractor to do the work for you.