by MICHAEL BODEEN | Jan 12, 2015 | Bodeen Team Blog, Real Estate News, Selling a Home
In last week’s blog, we discussed the importance of timing the listing to go on the market. We made mention that timing may be different based on the type and location of the neighborhood and the amount of buyers that are typically drawn to it.
This week we want to look at the MOST IMPORTANT part of the property listing. Pricing.
Without argument, the most important part of the home sale process is the home’s pricing. As important as timing, staging, and property conditioning are, they will not trump bad pricing. One of the most important responsibilities of the Realtor professional is to provide an accurate market analysis of the property’s value. The other part of this equation is the seller being on board with the right price. Trust in your Realtor professional’s price opinion will go a long way toward a successful and timely transaction.
In determining the right listing price, the Realtor professional needs to show the homeowner not only the neighborhood comparable sales during the past six months, but also the current “Pendings” and “Actives.” If the market is feverish (either rising or falling) then sales should only go back 3 months. If it’s a slow, plodding market, with little price change, we can look at sales longer than 6 months, but lenders may not.
Why do we look at Pendings and Actives? Well, for one, Appraisers look at them, because lenders want to know what’s going on in the overall market. Pending sales can be the MOST accurate gauge of CURRENT sales activity and values, but since they may not close and we may not know the closing price yet, best practices would dictate using only closed sales.
Active listings are used to help determine the competition. If for example a similar floorplan has been for sale for 6 months and has not sold, we will want to compare that listing with our listing to ask why hasn’t this listing sold? Usually, nothing less than a phone call to this other Realtor is in order. This is where Realtor experience and savvy could be the difference in getting top dollars.
So now comes the time for structuring the listed price. If the recent comparable sales dictate a $375,000 sales price, should you price it at $375K? This is where knowing the current market trends is key. In a normal market we would probably advise a price slightly about 3% above the sold pricing. In a slumping market, we would probably want to price it no higher than comps. And vice versa in a strong appreciating market, pricing slightly more than that may be in order. Either way, if we have priced the property correctly, we’re pretty much assured that a sale won’t get “kicked out” of escrow down the line by the buyer’s lender but will close as scheduled.
And in the end, closing is the goal right?
Next week, we will look at what should take place in property preparing the home for sale.
by MICHAEL BODEEN | Jan 6, 2015 | Bodeen Team Blog, Real Estate News, Selling a Home
The holidays are over and you’ve sworn you’ll never have ALL the family over for Christmas dinner again, at least not uncle, “Lampshade” Louie. Discussion has once again turned to, “Should we put the house on the market?”
The all too common spousal back and forth banter takes place, but this time, you’re both in agreement. Though we may love it, we’re going to list it!
But when? Is there a best time to put the house on the market? Or does it even matter? Important question. Unfortunately sometimes there’s no choice about the “when” because your job transfer finally came through, or finances dictate the time to be NOW!
With few exceptions, more Phoenix-Scottsdale homes are under contract in April and May than any other month.
But if you had a choice, and you wanted to peg it according to the season that most buyers are looking, then yes, there is a statistical difference, but with caveats.
If you’re looking at pure statistics, and perhaps common sense, the ideal time to list your house in the Phoenix-Scottsdale metro area begins in March/April. With few exceptions, more Phoenix-Scottsdale homes are under contract in April and May than any other month. Of course if you live in a colder, snowier part of the country, then that timing will be delayed.
The best time to list should be when your curb appeal looks the very best. Green lawns, blooming flora, and a freshly painted exterior (if needed) will by themselves increase your house showings. In general, the more house showings, the quicker the sale and for the best price.
The other reason why spring is the better time to sell is that so families can be settled in their new home before school starts up again in August.
Now, having said all that, the choice of “when” will be different for the type of area you live in. If you live in an “Over 55” community, such as Sun City West, Trilogy in Vistancia, or McCormick Ranch, then you will want your house on the market as soon as you can following the holidays. This is when snowbirds who are renting and enjoying our mild winter desert temps, or out of town visitors, are going to be looking at homes for sale, especially seeking out Open Houses to go through.
Next week (Part Two) we’ll look at how best to prepare your Phoenix-Scottsdale home for sale and how much you should do, and not do.
by MICHAEL BODEEN | Dec 29, 2014 | Bodeen Team Blog, Buying a Home, Real Estate News, Selling a Home
Many buyers, especially first time homebuyers can get very uptight about buying a home, indeed, both buying and selling a home is stressful. I’ve heard it said that the degree of stress that buyers and sellers go through during the home buying/selling process is akin to the stress of losing a spouse. Now, that doesn’t mean that the two are related in terms of importance, but only how the human body metabolically responds to the stress.
Well, we can’t prevent clients from not having stress, but I will say that Arizona’s purchase contracts, which are decades in its evolutionary process, go a long way toward alleviating the stress load and in fact may be the very best consumer-centric real estate contract in all 50 states. Having worked in California for 18 years and using their forms, and then coming to Arizona, there is no comparison in terms of “User Friendliness.” In California, for example, we were told we could not explain to clients what a given clause meant as that would be practicing law, for which we are not licensed. The problem was in the legalese, the lack of clarity.
In Arizona our forms are crafted to be understood. Every few years a large, select group of industry officials including brokers, lenders, contractors, termite and home inspectors, Department of Real Estate, lawyers, to name just a few, meet to see which clauses are working and which aren’t. As Realtors, we have the chance to give our two cents worth prior to the group meeting. Out-dated stuff gets tossed, new legislation gets integrated, and best practices are utilized. I sadly contend that if a consumer will take one to two hours to carefully read our contracts, they might know as much (or more) than their agent about the agreement.
Perhaps the greatest tool in the hands of buyers, sellers, and Realtors, is the “Buyer Advisory” put out by the Arizona Association of Realtors. This contains links to virtually every aspect of house buying in Arizona. To view this form, go to: http://www.aaronline.com/wp-content/uploads/sample-forms/BuyerAdvisory.pdf
On top of the Buyer Advisory, we have our
“10 day Due Diligence”
period (aka inspection period). This is one of the most critical and valuable parts of the home buying process. For buyers, it’s the best opportunity to find out pretty much everything there is to know about the home they’re buying. If a buyer, in their 10 Day Due Diligence, determine there is something that they don’t like, they can withdraw from the agreement without forfeiture of deposit. Does the request need to be reasonable? Used to, but now it’s strictly up to the subjective opinion of the buyer. This takes the pressure off.
But what about the seller, how does it benefit them? It greatly benefits the seller. I feel it goes a long way to reducing ye old “Buyer Remorse.” If buyer, seller, Realtor all understand that the buyer pretty much has a ten day “free look” then once the buyer has gone past this period, they are “locked” into the deal with the exception of a financing contingency. If they back out during the first 10 days, it’s only 10 days, and then we can get the property back on the market. This means that following that 10 days, everyone can pretty much expect smooth sailing to closing.
(…and if you’ll buy that…)
by MICHAEL BODEEN | Dec 8, 2014 | Bodeen Team Blog, Real Estate News, Selling a Home
TEMPE RANKS AS ONE OF THE BEST COLLEGE TOWNS for students and permanent residents alike, based in part on:
- Livability
- jobs
- housing affordability
- availability of rental units
- walkability
The ranking was completed by www.livability.com, which states that Tempe offers a big city experience while still maintaining a small town feel. The study further noted that Tempe has a diverse economy, major university, vast shopping opportunities, excellent recreation facilities, great local transportation, including a good “walk Score,” warm sunny days and, I will add, PAC 12 ASU Sun Devil football and basketball.
PENT UP DEMAND FOR ACTIVE ADULT COMMUNITIES? Homebuilder confidence in the market for homes aimed at buyers over the age of 55 rose in the second quarter – its highest 2nd quarter reading in 6 years. According to the National Association of Builders chief economist, David Crowe, “The slow but steady increase in existing home sales” is one of the factors of this optimism.
As more and more of the over-55 crowd is able to sell their homes for better prices, many are looking to the active adult communities for their next move.
IT’S ALL ABOUT THE KITCHEN STUPID! What ranks as the most important feature for buyers considering a “new” home? Well no surprise here, but according to the PulteGroup Home Index Survey, 30% of Americans say they consider the kitchen to be the most important area when choosing a new home. And considering the phenomenal popularity of cable TV home and cooking shows in the past 5 years, it looks like this trend will only move upwards.
Surprising to me anyway, is that the master bedroom is ranked the 2nd area of importance by 22% of the new home buyers. In personal experience of showing buyers homes, the “Great Room” seemed to be almost as important as the kitchen.
HOMEOWNERSHIP DECLINING The U.S. homeownership rate declined for the ninth year in a row in 2012-2013 according to the Joint Center for Housing Studies of Harvard University. The number of homeowner households also fell for the 7th straight year with a drop of 76,000. Homeownership rates, per the study, for ages 25-54 are at their lowest rates since 1976.
These declines are the smallest reported since 2008 suggesting that the bottom may be in sight. Without question, our great recession, spurred on by the housing debacle of 2007-2009, was the main culprit as more folks lost homes or walked away and turned toward renting or living with relatives. As the numbers turn, homeownership will again head upwards in a big way.
by JONATHAN BODEEN | May 8, 2014 | Selling a Home
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