Get the Most out of Your Real Estate Transaction With These FAQs

This frequently asked question cannot be answered in general. Every real estate market is different. Therefore, the best time to sell a home will differ from real estate community to real estate community. In most cases, spring is the best time to sell a home. Since every home seller's situation is different, you should discuss the timing of your home sale with your Realtor. This is due to a combination of many factors, including lower competition and serious buyers always looking for a home, just to mention a couple of factors.

A frequently asked question from home sellers before listing their homes for sale is related to the local real estate market. There are many market indicators that a top-producing Realtor should be able to share with you to help explain the condition of the local real estate market. One of the most important indicators of market conditions is the average days on the market. The average days on the market can indicate to a seller how quickly homes are selling when listed for sale.

Other examples of market condition indicators that a top-producing Realtor will provide a home seller before listing their home including market absorption rates, number of closed transactions year-over-year for a given month, average sale prices, and average list price-to-sale price ratios.

You need to know several things before listing your home for sale! A frequently asked question from home sellers before the listing is what steps should be taken before listing their home. Not properly preparing a home for sale can put a homeowner at a huge disadvantage.

The expression "You never get a second chance to make a first impression" is true when selling a home. When selling a home, you must ensure that it presents itself in the best possible light. Making sure clutter is minimal, freshly painting rooms, installing new carpeting, or ensuring odors are non-existent are just a few things that should be done before listing your home for sale.

When selling a home, you must disclose to potential buyers anything you are aware of in your home. Nobody likes "getting the raw end of a deal" when buying a home, car, or anything. If you're aware of defects with a roof, appliance, or home in general, you'll always be better off being honest and upfront. If you're aware of defects, whenever possible, fixing them before going on the market is best. This can avoid potential issues and/or lawsuits once your home is under contract, after inspections, and even years after you have sold your home.

Most homeowners want to know how much their home is worth. This frequently asked question is another one that cannot be answered with a generalized answer. One of the best perks to owning a home is the ability to make it your own and improve it how you'd like. Finding out how much your home is worth should not be done without asking a top local Realtor.

The assessed value is not the same as the market value or appraised value. There are many homes that could be sold for significantly more than an assessed value and others that may be sold for significantly less. The assessed value of a home is used for the purpose of taxes in your local municipality. The assessed value of a home is multiplied by the local tax rate to determine what your yearly taxes are. The assessed value does not impact how much your home is worth to a potential buyer in the marketplace.

Unfortunately, many home buyers believe a home listed higher than the assessed value is overpriced. This is the furthest from the truth. Home buyers also question if something is wrong with a home if the list price is much less than the assessed value. The bottom line is that the assessed value has no impact on how much your home is worth. Some homeowners don't pay attention to their assessed value, just to find out their municipality has been slowly raising it, year after year, even though the market value hasn't increased.

This frequently asked question can be answered very easily. The list price is the price a home is currently listed for sale at. The sale price is the price a home is sold at. A top Realtor should be able to suggest a list price that ends up close to the final sale price.

There are a handful of methods that Realtors use to determine the value of a home. The most common method to determining the value of a home is by completing a comparative market analysis. A comparative market analysis is an in-depth evaluation of recently sold "comparable" homes in the past 6-12 months. A comparative market analysis, also known as a "CMA," isn't a crystal ball that determines what a home will sell for; however, if performed by a top Realtor, it should greatly narrow the sale price range.

A professionally completed "CMA" will consider many features of a home, the local area, and the neighborhood. Considerations that a professionally completed "CMA" include, but is not limited to:

1. Square footage
2. Number of bedrooms
3. Number of bathrooms
4. Upgrades to the kitchen
5. Window quality
6. Roof age
7. Lot Features
8. Location; primary or neighborhood street?
9. Style of residence
10. Flooring type

The answer to this frequently asked question is NO! Anyone who has bought a home sold a home, or just looked at homes has heard of websites such as Zillow and Trulia. These are also commonly referred to as third-party real estate websites. Third-party real estate websites are not local to every real estate market.

These third-party real estate websites provide estimates of home values for practically any home in the United States. How is it possible that a third-party website headquartered in California or Florida can provide an accurate home value for a home in Rochester, NY? It's not! These third-party websites, such as Zillow and Trulia, use computer-generated home values based on calculations and formulas.

These websites providing inaccurate estimates (or "Zestimates") can create a false sense of hope and lead to frustration. A home seller told their home is worth $20,000 less than the online estimate will be understandably upset. It's critical that when selling a home, the value is determined by a top Realtor in your local area, not an internet website!

This frequently asked question often leads to a common pricing mistake that sellers make. Many sellers believe they should price their home $5,000 higher than a top Realtor suggests to leave room for negotiations and low-ball offers. A well-priced home will sell quickly and will sell for close to the listing price. There is no need to leave room for negotiations, as today's home buyers are very well-educated. A seller who prices their home high to leave room for negotiations can be costing themselves more money than if they price it to reflect the suggested market value.

Most frequently asked questions related to exclusive right-to-sell contracts cannot be answered with a universal answer. Regarding the length of a listing agreement, every real estate agent will have a different preferred length. One thing to remember when asking about the length of a listing agreement is the average days on the market. If the average days on the market in your local real estate market are 75, a 90-day listing agreement may not be enough.

The commission is negotiable, period. Don't let any Realtor tell you otherwise. That said, the saying "you get what you pay for" often is true regarding real estate. If a Realtor offers a lower commission, do you think they will negotiate aggressively on your behalf regarding the price? Also, if you were working for a reduced hourly wage from your "normal," would you work as hard as you normally would? The answer is likely not. Choosing a Realtor based solely on the fact they offer the lowest commission amount is a top mistake home sellers make when choosing a Realtor to sell their home.

This frequently asked question is not one seller likes to ask when selling a home. However, it can come up frequently. The hope when selling a home is a quick sale and top dollar. This isn't always the case, however. Every state and contract has different terms, but generally speaking, if you cancel the listing agreement, you could be responsible for any expenses incurred by the real estate agent and their brokerage.

Every municipality is different, but generally, when improving or changing a piece of property or land, a certificate of compliance (and permit) is required. Potential buyers can ask for compliance certificates for improvements, such as decks, patios, or sheds when selling a home. Some buyers may not ask for any permits, and some may. Technically, you do not need to provide any permits or certificates of compliance. However, you could lose a potential buyer over a simple fence permit.

When selling a home, it's best to think of any decision as a business decision rather than an emotional one. Low-ball offers still happen, unfortunately. Dealing with low-ball offers can sometimes lead to the sale of a home if handled properly. The worse decision you can make if you receive a low-ball offer is not responding. Some homeowners are so upset that they do not want to respond to a low-ball offer, ultimately ending any possible chance for a deal. Even if it's close to the list price, a counteroffer is better than letting a potential buyer walk!

Depending on what type of financing the potential purchaser is obtaining, the option to receive seller concessions may or may not exist. Many home buyers in the marketplace have impeccable credit scores and solid jobs but are short on the money required to purchase a home. Seller concessions allow a homeowner to contribute a percentage or dollar amount towards a buyer's closing costs and/or pre-paid items. For example, a buyer who qualifies for an FHA mortgage can receive up to 6% of the purchase price towards closing costs. This can be a significant amount of money and the difference between a buyer's ability to afford a home or not or the seller's ability to sell their home!

If a home buyer obtains financing from a bank, the bank will complete an appraisal. When performing an appraisal, the appraiser looks for potential safety hazards or concerns. The buyer will determine in their purchase offer a dollar amount in which a seller is responsible for covering bank-required repairs. Some common bank-required repairs include missing handrails, broken windows, peeling paint, missing electrical covers, and poor-quality roofs.

In addition to ensuring no safety hazards at home, the bank appraiser also ensures that the home value is at least what a buyer and seller agree to. This is only sometimes possible, though. If an appraiser determines the value of the subject property is lower than the agreed purchase amount, there are a couple of different scenarios.

Seller Makes Concession

This is the most common result when an appraisal comes in too low. The seller must agree to sell the home for what the appraiser determines as the acceptable value.

Buyer Comes Up With Difference

The buyer must bridge the difference between the purchase price and the appraised value. This scenario is fairly uncommon as many buyers find it hard to pay more for a home than their bank appraisal indicates its worth.

The Transaction is Cancelled

Unfortunately for the seller and buyer, this is a common result of property under-appraising. If the buyer wants to avoid bridging the difference and the seller wants to make the concession and adjust the sale price, the transaction is canceled.

Challenge Appraisal

Challenging an appraisal is a challenging task. It is something that must be done with much care and consideration. Otherwise, the chances of an appraised value being changed are slim.

Some buyers decide when buying a home that they would like to find a suitable property before selling their existing home. A sale contingency is a common contingency that seller's seen in purchase offers. A sale contingency means that the potential buyer of a home must sell their existing home before being able to purchase the "new" home.

Inspections are another common contingency that buyer makes their purchase offers subject to. A buyer has the right to perform many different types of inspections and tests. In most cases, inspections are at the expense of the buyer. They have a specified number of days to complete the inspections and a specified number of days to either remove the inspection contingencies or request the seller address findings from the inspections.

Another popular question from home sellers is how much it will cost to sell a home. There are expenses that the buyer will have that the seller will not, and vice versa. Typical closing expenses for home sellers include the abstract and title search, instrument survey, real estate commissions, and transfer taxes, known as revenue stamps.

In many cases, the appliances in one home will not fit or look right in another. Whether to include appliances or make them negotiable is ultimately up to the seller. One thing to remember when deciding whether to include your appliances, they only add a little value to a home since appliances are considered personal property.

A comprehensive marketing plan is something that you should expect from your Realtor when selling a home. The days of placing a sign in front of a property and waiting for someone to sell it are over. With the evolution and the impact the internet has had on the real estate industry, it's critical that not only is your home marketed through "traditional" avenues, such as newspapers and mailings, but it must also get maximum exposure online.

A top Realtor should have a quality website and a strong social media presence. Where a Realtor's website ranks in search results is critical since over 90% of buyers are beginning their home search online!

This frequently asked question can be a fairly complex answer. In most cases, however, potential buyers are not looking at your home due to the price. Buyers who feel a home is priced too high will choose to look at other homes before yours, likely finding one before they reach yours. Other possible reasons your home is not being looked at include poor curb appeal, poor location, or lackluster marketing efforts from your Realtor.

Please recommend service providers who may be needed throughout the transaction.

No matter what industry, top professionals enjoy working with top professionals. This is no different in real estate. A top Realtor should be able to provide high-quality mortgage professionals, attorneys, contractors, movers, or other services needed throughout the home-selling process.

Like many of the answers to these frequently asked questions, the frequency and methods of communication will vary from agent to agent. At a minimum, you should hear from your Realtor at least once a week when selling your home. The methods in which a Realtor communicates with their sellers should be tailored to each seller. If a homeowner prefers e-mail, the Realtor should communicate via e-mail. The same can be said about text messaging, phone conversations, or face-to-face interaction.

Preparing a home for showings can be a job in itself. A home well prepared for home showings will likely sell faster than its competition. Making sure a home is cleaned, de-cluttered, and bright and that no foul odors are present are just a few things that sellers must do to prepare their homes for showings.

Easy question to answer – no! There are many reasons why sellers should not be present during showings. You should not be present at showings of your home because potential buyers can feel uncomfortable talking openly and freely with their Realtor about your home. They do not want to say something that could offend you, the seller. The best idea is to leave shortly before the scheduled showing and come back once you are certain the buyer and their Realtor have left your home.

Open houses are a fairly controversial topic in the real estate industry. Some Realtors will convince a seller that they will get their home sold because they hold it open every weekend. Unfortunately, these same Realtors are not being honest with the seller. The truth is that open houses are not necessary to sell a home.

A Realtor will convince a seller that open houses are necessary because they hope to pick up additional buyers. The percentage of homes that sell due to an open house is less than 5%. Ask the Realtor about open houses and ensure you agree with their response. You must be on the same page as the Realtor regarding open houses.

Before Your House Is Shown

Tag or remove items not included in the sale (i.e., water conditioner, chandeliers, plants, drapes).

Open shades and curtains to let in light.

Turn on enough lights so the home is well-lit during the showing.

At night, turn on the porch light and outdoor lighting.

Tidy all the rooms. Neatness makes a room easier to view.

Clean dirty dishes in the sink and put away any dishes on the counter.

Keep toys in the children's rooms.

Put away items in the yard, such as bicycles, gardening tools and skateboards.

If fall or winter, light a fire in the fireplace.

While Your House Is Being Shown

When possible, leave while the property is shown. If not, remain in an area not shown by the sales associate.

Let the real estate expert show your house. Answer questions candidly when asked, but avoid questioning potential buyers.

Refer inquiries about seeing your house to your Realtor to take advantage of the agent's professional selling skills.

Only mention items you wish to dispose of if asked.

It is best to be away when your agent is holding an open house.

Keep pets outdoors or in one area.

Keep children quiet and in one area.

Keep radio, stereo or TV on low volume.

Keep money and other valuable items out of sight.