Real Estate Tips

Negotiating real estate deals to win-win by Charles Warnock

If you’ve spent some time on homekeys.net, you probably noticed we generally don’t carry a torch for tradition or conventional wisdom. Having said that, the well-worn cliché above still holds true, especially in real estate transactions.

Many buyers and sellers put in countless hours carefully searching properties or preparing their homes for sale, only to see their sweet deals vanish at the negotiating table. Even if you’re not an experienced negotiator, there are steps you can take to improve results whether you’re buying or selling property. Negotiation doesn’t need to be a confrontational process if you set priorities, plan ahead and stay focused on issues, not personalities.

By far the largest expense related to traditional real estate transactions is the agent/brokers’ commission, and independent buyers and sellers should take advantage of this fact. Without the “overhead” of a 5-6 percent commission, both buyer and seller have a little more flexibility to come to an agreement that’s acceptable to both parties. Here are some negotiation tips for independent buyers and sellers.

Seller negotiating tips:

Set realistic priorities before you start.

When selling, be sure to outline realistic goals before negotiations begin. If you’ve decided that you need to sell your home for at least $250,000, expect to have very different negotiations than if your goal is to sell within 30 days. If money is your primary concern, be prepared to turn down some offers as you wait for the right buyer. If time is more important to you than money, be sure to include some flexibility in your asking price.

Ultimately, the market sets the price.

Set your price too high and your house may sit on the market, becoming less attractive to buyers (some sources estimate a monthly decline of 1.5 percent). Price too low and you’ve got less room to negotiate and may be leaving money on the table. Homekeys.net Subscribers can quickly obtain an objective estimate of property value using our online valuation tool before listing. Another option is to hire a professional property appraiser prior to listing. You may find the cost of either option to be modest compared to making an expensive mistake in your selling price.

Take inventory and take advantage.

Typically, property sales include anything that’s installed or built in to the home. If you’ve got appliances, furniture or fixtures you’re willing to part with, you may be able to entice prospective buyers by including them in the deal. Would buyers be interested in your BBQ grill or pool equipment? It can’t hurt to ask.

Buyer negotiating tips:

Clean up your credit

A great way to strengthen your case as a buyer is to demonstrate excellent credit. The time to check credit is well before negotiations begin so you can square away problems. Many credit issues are not difficult to fix and can be straightened out fairly quickly. Here’s how to check your credit.

Get pre-approved, not just pre-qualified

Pre-approval is another way to flex your buyer muscles because it lets you demonstrate to a prospective seller that your lender is prepared to give you a loan. Many sellers will choose a lower offer from a pre-approved buyer over a higher one from one who hasn’t been pre-approved. Pre-approval is free and can prevent that worst-of-all situation where a buyer successfully negotiates the purchase of his or her dream home and then cannot complete the purchase when financing falls through. Get pre-approved today.

Look for areas other than price.

Even though independent sellers can avoid some or all commission costs, there are still other fees that might apply: property and termite inspections, escrow or attorney’s fees, a title search, insurance costs and applicable taxes. Even if sellers don’t offer much flexibility on asking price, they may be more willing to make a deal with buyers who offer to share the costs of necessary repairs or transaction expenses.

Be prepared to compromise.

Approaching negotiations with a confrontational “win-at-all-costs” attitude is unlikely to yield positive results. Many professionals who teach negotiation skills to executives say a more realistic goal is to find a mutually beneficial solution in which both parties can “win.” This means being aware that you may have to sacrifice something to reach agreement at some point. In this case, be sure to identify in advance what you will and will not give up to ensure you’re happy with the deal in the long term.

Back up your offer

When offering to buy a property, you don’t have to explain how you arrived at a particular dollar amount. But you may fare better in negotiations if you have some objective basis, such as examining comparable sales. If you’re a Subscriber, try Homekeys’ ValueKey valuation tool for an objective estimate of value. If you’ve got a substantial down payment that you’re ready to put into escrow, now’s the time to mention it.

All participants in a negotiation should be prepared to walk away from unacceptable terms. You may be reluctant to give up after all the time you’ve invested in the buying or selling process, but emotionally tense negotiations can sometimes benefit from a cooling-off period. Walking away (or watching the other party walk away) may be uncomfortable, but it is always preferable to accepting terms you can’t live with.

Finally, remember that there’s often value in being direct. Don’t be afraid to ask questions to learn more about the other person’s concerns and objectives. “What do you need from me right now?” “What’s making you uncomfortable?” “It seems we are stuck on this particular issue. Can we set it aside for a moment and see if there is somewhere else we can gain agreement?” Questions like these can help signal your good faith and may help to restart negotiations that become bogged down in details.

About the Author

Charles Warnock is Marketing Communications Manager at Homekeys, a South-Florida based real estate and technology company. He writes often on real estate, finance, interactive marketing and business development.

Reinventing real estate, Part 2 by Charles Warnock

How online and empowered consumers
are taking charge and paying less.

Demanding consumers

“Internet buyers tend to be better informed on market conditions and better prepared to act on the home they want when they start working with a realtor. Luckily for realtors, these changes don’t necessarily hurt, as long as they are able to adjust to the new relationship and realize that the new-style buyers value speed and efficiency over guidance when finding a home.”

– E-marketer, Internet Home Buyers Changing the House Rules

Thanks to the Internet and other technological innovations, more real estate information is freely available than ever before. As a result, consumers are demanding new choices, improved services, faster transactions and lower prices. According to a recent NAR survey, the number of sellers stating that they didn’t want to pay a sales commission fee rose from 46 percent in 2003 to 61 percent in 2004. In 2004, 23 percent of Florida home sellers opted to sell independently without an agent, up from 14 percent in 2003 and nearly double the 14 percent national average, according to Planet Realtor.

And Web-enabled consumers are demanding a high digital IQ when working with real estate professionals. In addition to being well-versed on their own industry-specific technology, real estate professionals now are expected to utilize laptops, mobile phones, digital cameras, personal digital assistants and global positioning systems to keep pace with Internet buyers and sellers.
Downward pressure

“If consumers are going to do their own home-shopping online, they expect to save some money, just as they would for using the self-service lane. That’s why they are susceptible to online discount brokers and the new affinity companies that are promoting lower commissions if only the consumers will use their agents. These business models promote the idea to consumers that they ought to be paying less money in commissions.”

Realty Times Columnist Blanche Evans

Traditional real estate commissions, typically around six percent of a home’s selling price, are facing downward pressure from consumers and competition. Some consumers claim traditional real estate commissions don’t reflect:

Today’s home prices. Years ago, when median-priced homes sold for $25,000, real estate commissions were typically five percent, or $1,250. Today, with South Florida median home prices around $300,000, the cost of a six percent full-service real estate commission becomes $18,000. Some brokers even charge additional fees to cover administrative costs. When you consider that today’s average homeowner sells a home every five to seven years, real estate commissions can dramatically impact your personal savings and net worth.

Owner equity. When selling properties, most homeowners calculate the cost of selling as a portion of sales price, though the commissions are paid out of owner equity. (Equity is the difference between the value of your property and amount of mortgages owed.) Consider this example: You decide to sell a property for $250,000 in which you hold 10 percent equity, or $25,000. After paying a six percent commission of $15,000, you are left with $10,000 before any applicable closing costs. In this example, the $15,000 commission is six percent of the selling price, but 60 percent of the $25,000 equity.

Services performed. Under today’s commission structure, selling a $100,000 house at six percent typically costs $6,000, while selling a $500,000 house costs $30,000. Does selling the more expensive home really require five times more effort? Your cost is the same whether the agent spends one hour or 100 hours marketing your home. This is one reason many real estate consumers find fee-for-service real estate so appealing.
Developing alternatives

“Consumers want what they want, when they want it and will gravitate to the most cost-effective source to obtain it. Why? Because our “one-size-fits-all” approach to working with sellers and buyers is archaic and won’t allow consumers to access various segments of help they need in a timely fashion. That’s why .com Web start-ups are finding a receptive audience in real estate consumers and why for-sale-by-owners are burgeoning.”

Julie Garton-Good, Author of “Real Estate a la Carte: Selecting the Services You Need, Paying What They’re Worth”

Until recently, you have had few practical alternatives to the traditional full-service, full-commission real estate transaction with a broker. Most sellers paid a single commission fee for a full range of real estate services, whether they needed them or not. Now traditional real estate agencies face the challenge of identifying new services that have value to today’s sophisticated online and empowered consumers.

One result is an “unbundling” of traditional one-size-fits-all real estate services for consumers who want more control over real estate transactions and their associated costs. If you’re willing to take on some tasks traditionally performed by agents and brokers, you could receive lower transaction costs. You might benefit from the following emerging alternatives:

Fee-for-services

“Consumers want assistance from real estate professionals, but don’t want to pay for it in the form of traditional commissions,” says a la Carte real estate Pioneer Julie Garton-Good. Garton-Good has been preaching the fee-for-services gospel for more than 20 years. As the name implies, you can choose which tasks you feel comfortable performing and hire qualified real estate professionals to do the rest. Many traditional real estate brokerages are beginning to offer a more menu-based service plan. For example, you may not mind listing your home and holding open houses, but you may want assistance with contracts and closings.

One-stop shopping

In response to dwindling margins and the rising costs of technology and lead generation, some real estate companies are attempting to combine traditional and Web-based services to provide consumers a single source for all their real estate needs. One-stop shopping sites generally provide or partner with lenders, insurers, title companies, real estate attorneys and others to facilitate all aspects of buying and selling. In addition, some sites are adding home-improvement and related services to stay in touch with consumers between buying and selling transactions.

Web-based discounters

Although many Web-based real estate companies flamed out in the dotcom era, scores of new companies have emerged to take their place. By offering targeted services such as flat-fee MLS listings, buyer rebates and AVM tools, these sites are appealing to independent buyers and sellers who prefer to take a more active role in transactions. In addition to listings, some sites also offer how-to articles and advice for those who choose to go it alone.
Tradition + technology + turbulence = opportunities

So, given the trends, changes and ongoing industry evolution, what can independent buyers, sellers and investors expect in this new era of real estate?

• The Web and other technologies will continue to evolve and transform the $1.3 trillion real-estate industry. Technology will continue to reduce the time, expense and complexity of manual processes, and increasingly sophisticated search and valuation tools will play a more strategic role.

• Free and low-cost real estate resources will continue to be available and even multiply on the Web. In real estate, knowledge truly is power. Consumers will try to use their power to gain more control of the real estate process and subsequently expect to be compensated in the form of reduced and fee-for-service commissions.

• The role of traditional real estate brokerages will evolve as Web-enabled consumers become more knowledgeable. This likely will trigger some restructuring and consolidation of traditional brokerages, but will also drive the development of innovative new practices targeting online and empowered consumers. Real estate professionals will focus more on promoting their local knowledge and industry expertise, while consumers will perform some buying and selling tasks on their own.

• Traditional real estate commissions and profitability levels will continue to face downward pressure from various sources. The future will be profitable for brokerages that are able to extend their core expertise of neighborhood and industry knowledge into flexible new consumer-centric offerings.

• The traditional high-touch, full-service real estate agency is evolving, not disappearing. Real estate professionals who provide exceptional service and value to their customers will always be in demand.

You now can find more real estate knowledge, tools and resources on the Web than ever before, enabling you to buy and sell with increased confidence. For real estate professionals, reinventing the industry means making hard decisions, changing processes and managing new opportunities. But for consumers, reinvention in real estate is a winner, hands-down.

Homekeys is coming soon. Be sure to look for us on the Web at http://www.homekeys.net
Feedback, ideas or input? We would like to hear from you! E-mail us at: info@homekeys.net

About the Author

Charles Warnock is Marketing Communications Manager at South-Florida based Homekeys. He writes frequently on real estate, finance, interactive marketing and business development.

The Art & Science of Property Valuation by Manuel Iraola & Charles Warnock

The Art & Science of Property Valuation

It is no secret that sellers want to sell high and buyers want to buy low. But they often arrive at the negotiating table with very different ideas on price. A fair and objective property valuation can help buyers and sellers find common ground and streamline the negotiation process.

In the end, the property is worth what a buyer is willing to pay. But to help both buyers and sellers achieve their goals, both should have a fair and objective estimate of property value. Unfortunately, even objective estimates are still estimates, and there is no way to assure 100% accuracy:

* Appraisals performed by a certified appraiser are not 100 percent accurate.

* CMA’s (Comparable Market Analysis) and BPOs (Broker Price Opinions) performed by a licensed broker or agent are not 100 percent accurate.

* AVM (Automated Valuation Model) technology is not 100 percent accurate.

All these methods, when properly executed, can provide a good indication of value. Estimating value is a combination of art and science. Regardless of how scientific the approach, the actual sale price is subject to the unique variables of each property transaction: property condition, upgrades, current market conditions, circumstances of the sale and individual tastes.

For property owners, pricing correctly is a key to a successful sale. Under-pricing can result in a fast sale, but carries the risk of leaving money on the table. Sellers who price too high may find their properties lingering on the market, and statistics show that values can erode at a rate of about 1.5 percent per month. Longer sales also increase the likelihood of a “distressed sale” when sellers become frustrated or encounter difficult financial circumstances.

Likewise, buyers should avoid emotional purchases. Overpaying because of “falling in love” with a home is common. Homekeys’ ValueKey Technology can help establish an objective, unemotional baseline for buyers and sellers so distressed sales and emotional purchases become the exception, not the rule.

The science of AVMs

To determine a good baseline value for a property, use Homekeys to search thousands of property records for comparable sales or “comps.” Homekeys’ ValueKey tool uses advanced statistical models and proprietary algorithms and formulas to find the best comparable properties available. In addition to property characteristics, the system evaluates how recent comparable sales are and how close properties are from the property being evaluated. Once a base property value estimate is determined, it’s time to check active listings to see what similar properties are selling for. ValueKey searches both owner- and broker-offered active listings to find the most comparable properties available.

The art of AVMs

The art portion of estimating value begins with understanding how comparable sales and active listings compare to the property being evaluated. Since they are nearby, it’s a good idea to drive by comparable sales and listed properties to see how they compare. To help you stay organized, you may want to use a buyer checklist when visiting properties.

After researching comparable sales and active listings, it’s time for the personal touch. Sellers know their own property and neighborhood better than anyone, so they are able to adjust base values according to individual property characteristics. Buyers can make similar adjustments as they visit properties to help formulate an asking price.

Depending on your research, a “market adjustment” may be warranted. If active listings are priced higher than your base estimated value, an upward adjustment may be appropriate. If prices are lower, a downward adjustment might be in order.

Finally, ValueKey enables buyers and sellers to make other value adjustments based on individual property characteristics and condition. Based on a seller’s knowledge or a buyer’s research, appropriate value adjustments can help both parties arrive at a fair selling price.

And though no property valuation system is perfect, AVMs can provide objective valuation estimates quickly and inexpensively, and the technology is improving all the time. As AVM technology continues to evolve and improve, it may prove to be a key to less-stress, more enlightened real estate transactions in the future.

Learn more at http://www.homekeys.net

About the Author

Manuel Iroala is President and CEO of Homekeys. Charles Warnock is Marketing Communications Manager at Homekeys, a South-Florida based real estate and technology company. This article can also be found at www.homekeys.net

HOUSES WITH DAM(P) BASEMENTS WON’T SELL by Jack Overton

A real estate agent’s gut-wrencher: The prospect turns to hubby and says, “Isn’t this so homey and practical and just what we were looking for. Now, let’s go down and look at the basement.” They open the basement door and get the feeling that Noah must have been running an all-nighter down there!

“What did you say the asking price is? Hmmm, well we have a friend cross-state who just had their basement waterproofed and dried out and it cost them over fifteen grand, so we’ll just lower our offer by that much for openers so we can fix the basement.”

Well, with a little forethought and action, the sellers could probably solve that dam(p) problem for about 2 to 3 thousand and the new dry basement may very well become the final clinching selling point!

THE FOUR STEP SOLUTION TO A HAPPY CLOSE—

1. Learn online: the why’s and how’s of basement water problems.
2. Fortify yourself by knowing the over-sell’s and the gotcha closings of the waterproofing professional salesman.
3. Choose a contractor who has been around longer than the last big rain.
4. Get a sign-off from the buyer that the work done will be acceptable without any further obligation on your part. The buyers will rely on a good contractor’s guaranty.

About the Author

Jack Overton has been in residential waterproofing sales, installations and service for 30 plus years. He has put together a 32 page illustrated volume that will tell you everything you ever wanted to know about basement waterproofing but were afraid to ask. It is a scambuster’s dream.
Visit www.NPImall.com for the download.

A Few Points About Interest Rates by Madan “Raja” Ahluwalia

Less is more

If you’re new to investing or real estate and don’t know the first thing about interest rates, here’s a good tip: the higher the interest rate, the more expensive it’s going to be. High interest rates mean you will have to pay back more on the money you borrow. Another good rule of thumb is that affordability increases if you use an adjustable rate mortgage (it’s easier to qualify this way). Of course, there will be a wide range of prices that you can choose from, depending on what kind of financing you choose.

Not even the Fed knows for sure

The Fed holds a considerable amount of power, but they can’t control everything. Mortgage interest rates are affected by many unpredictable political, economic and social events. So there is no guarantee what direction interest rates will go, despite the forecasts of the experts. Therefore, make your financial decision based on where things are today including your budget, your needs and your future plans.

Locking in rates assures your lowest interest

If you do decide you want to lock in at a certain interest rate, you will need to complete a loan application and send it to your lender as soon as possible. This must be done so that your commitment doesn’t run out before your loan is approved. Follow up and be se sure that the lender is receiving all of the necessary documentation. Get a property appraisal, which usually costs about $300, through your loan agent as soon as possible.

Don’t obsess and miss a good real estate deal

Although rising interest rates can create more problems for home buyers, waiting and hoping for low rates is not necessarily a smart move. You may end up paying a higher price. Also, refinancing is always an option in the event that interest rates come down.

(c) Copyright 2005 Madan Ahluwalia. All rights reserved.

About the Author

Madan “Raja” Ahluwalia is an Attorney at Law & Realtor. Raja offers his clients a counseling-based approach to home buying, where the client’s long-term goals are the most important consideration. He possesses a thorough understanding of the market and trends, based on years of involvement in real estate. He provides expert insights and helps clients understand timing, pricing and financing issues. Contact Raja at raja@kw.com or 650.430.4023.

7 Selling Mistakes You Don’t Want To Make! by Madan “Raja” Ahluwalia

Mistake #1 — Pricing Your Property Too High

Every seller obviously wants to get the most money for his or her product. Ironically, the best way to do this is NOT to list your product at an excessively high price! A high listing price will cause some prospective buyers to lose interest before even seeing your property. Also, it may lead other buyers to expect more than what you have to offer. As a result, overpriced properties tend to take an unusually long time to sell, and they end up being sold at a lower price.

Mistake #2 — Mistaking Re-finance Appraisals for the Market Value

Unfortunately, a re-finance appraisal may have been stated at an untruthfully high price. Often, lenders estimate the value of your property to be higher than it actually is in order to encourage re-financing. The market value of your home could actually be lower. Your best bet is to ask your REALTOR® for the most recent information regarding property sales in your community. This will give you an up-to-date and factually accurate estimate of your property value.

Mistake #3 — Forgetting to “Showcase Your Home”

In spite of how frequently this mistake is addressed and how simple it is to avoid, its prevalence is still widespread. When attempting to sell your home to prospective buyers, do not forget to make your home look as pleasant as possible. Make necessary repairs. Clean. Make sure everything functions and looks presentable. A poorly kept home in need of repairs will surely lower the selling price of your property and will even turn away some buyers.

Mistake #4 — Trying to “Hard Sell” While Showing

Buying a house is always an emotional and difficult decision. As a result, you should try to allow prospective buyers to comfortably examine your property. Don’t try haggling or forcefully selling. Instead, be friendly and hospitable. A good idea would be to point out any subtle amenities and be receptive to questions.

Mistake #5 — Trying to Sell to “Looky-Loos”

A prospective buyer who shows interest because of a “for sale” sign he saw may not really be interested in your property. Often buyers who do not come through a REALTOR® are a good 6-9 months away from buying, and they are more interested in seeing what is out there than in actually making a purchase. They may still have to sell their house, or may not be able to afford a house yet. They may still even be unsure as to whether or not they want to relocate.

Your REALTOR® should be able to distinguish realistic potential buyers from mere lookers. REALTOR®s should usually find out a prospective buyer’s savings, credit rating, and purchasing power in general. If your REALTOR® fails to find out this pertinent information, you should do some investigating and questioning on your own. This will help you avoid wasting valuable time marketing towards the wrong people. If you have to do this work yourself, consider finding a new REALTOR®.

Mistake #6 — Not Knowing Your Rights & Responsibilities

It is extremely important that you are well-informed of the details in your real estate contract. Real estate contracts are legally binding documents, and they can often be complex and confusing. Not being aware of the terms in your contract could cost you thousands for repairs and inspections. Know what you are responsible for before signing the contract. Can the property be sold “as is”? How will deed restrictions and local zoning laws affect your transaction? Not knowing the answers to these kinds of questions could end up costing you a considerable amount of money.

Mistake #7 — Limiting the Marketing and Advertising of the Property

Your REALTOR® should employ a wide variety of marketing techniques. Your REALTOR® should also be committed to selling your property; he or she should be available for every phone call from a prospective buyer. Most calls are received, and open houses are scheduled, during business hours, so make sure that your REALTOR® is working on selling your home during these hours. Chances are that you have a job, too, so you may not be able to get in touch with many potential buyers.

(c) Copyright 2005 Madan Ahluwalia. All rights reserved.

Madan “Raja” Ahluwalia is an Attorney at Law and Realtor. Raja offer his real estate clients a counseling-based approach to home buying, where the client’s long-term goals are the most important consideration and outweigh the benefits of any single sale. Raja possesses a thorough understanding of the real estate market and trends, based on years of involvement in real estate. He provides expert insights and helps clients understand timing, pricing and financing issues. Contact Raja at raja@kw.com or 650.430.4023.

USED THIS BIO

Madan “Raja” Ahluwalia is an Attorney at Law & Realtor. Raja offers his clients a counseling-based approach to home buying, where the client’s long-term goals are the most important consideration. He possesses a thorough understanding of the market and trends, based on years of involvement in real estate. He provides expert insights and helps clients understand timing, pricing and financing issues. Contact Raja at raja@kw.com or 650.430.4023.

About the Author

Madan “Raja” Ahluwalia is an Attorney at Law & Realtor. Raja offers his clients a counseling-based approach to home buying, where the client’s long-term goals are the most important consideration. He possesses a thorough understanding of the market and trends, based on years of involvement in real estate. He provides expert insights and helps clients understand timing, pricing and financing issues. Contact Raja at raja@kw.com or 650.430.4023.

Finding the Best Real Estate Professional by Madan “Raja” Ahluwalia

Finding the Best Real Estate Professional

Finding the right real estate professional requires doing a little research and asking a few questions. You need to know everything about the selling process. What is the marketing strategy? What kind of advertising will be done? Is the REALTOR® capable and willing to communicate effectively? Can the REALTOR® effectively present and sell the less-noticeable assets of the property?

Real estate professionals also need to be knowledgeable about the community. They need to have a feel for the history of the area and the approximate price that people will be willing to pay. Also, real estate agents should know what the competition is and how much it will affect your sale.

NEVER choose a REALTOR® on price alone. Remember that a REALTOR® cannot magically raise the selling price of the house. Consider the buyer. The purchaser won’t willingly pay too much; it’s most likely that he or she will do research on the market and try to find the best product for the best price. The facts simply cannot be changed, no matter which REALTOR® you select. In spite of these unchangeable factors, the REALTOR® you select must still be diligent and knowledgeable.

If your property does not elicit attention within several weeks, the cause can most likely be attributed to one of these three factors: location, condition, and price. The location obviously cannot be changed. You should consider examining the conditioning of your property and reevaluating the marketing strategy. Ask your REALTOR® to offer an explanation of the competition and your pricing strategy.

(c) Copyright 2005 Madan Ahluwalia. All rights reserved.

About the Author

Madan “Raja” Ahluwalia is an Attorney at Law & Realtor. Raja offers his clients a counseling-based approach to home buying, where the client’s long-term goals are the most important consideration. He possesses a thorough understanding of the market and trends, based on years of involvement in real estate. He provides expert insights and helps clients understand timing, pricing and financing issues. Contact Raja at raja@kw.com or 650.430.4023.

10 Easy but Essential Steps for Home Selling Success by Rhiannon Williamson

They say that the whole process of selling up, buying new and moving on is one of the most stressful series of events any of us goes through in a lifetime: and yet with careful planning, attention to detail and a clear focus, the whole process can be relatively stress free.

While there will always be factors outside the control of any home seller, those factors that fall within their control sphere can proceed fluidly and smoothly when they take the time to plan and think one step ahead.

By following these 10 easy but essential steps I can guarantee you home selling success!

1. Get free valuations and priceless advice.

Real estate agents will give you a home valuation for free because ultimately they hope you’ll engage their services when it comes to selling your home. Therefore use the experience of a handful of local and trusted agents who are renowned for their selling success and invite them to come and value your home. Then, ask them their opinion on what if anything can be done to raise the value of your property to the maximum.

Real estate agents spend their entire professional lives examining properties, they know what attracts a buyer, what turns a buyer away and what can and should be done to a property to enable the seller to get maximum returns from his property – request advice based on the benefit of their experience. Most real estate agents will be happy to give you any tips they feel are applicable to your home because if you can increase the value of it, they can raise the price of it and if they are asked to represent you they will ultimately make more from the sale! It is a symbiotic process!

This whole first step will arm you with two priceless facts – firstly you will know how much money you can work with when budgeting and planning for your next home. Secondly you will have a fair idea of what action you should and can take to ensure you get the maximum price for your home thus allowing you to begin planning the work that needs to be done.

2. Speak to your current mortgage lender.

You need to contact your current mortgage lender and ask them what penalties and fees you will incur for early repayment. Inform them that you are intending to sell your home and they will give you an up to date statement of the amount remaining and exactly how much selling up is going to cost you in real terms.

3. Work out total selling, buying and moving costs.

To assist you with this step ask one of your valuation real estate agents to give you a break down of all the local fees, taxes and costs you will likely incur when selling and buying. These will most likely include the real estate agent’s fees, a lawyer’s fees, surveyor’s costs, potential gain taxation and also consider factoring in the percentage of any annual taxes or charges on your home that you will have to pay.

Add to these expenses the costs you will incur when buying a new home and remember to include any deposit, mortgage arrangement fees, survey costs and insurances.

And last but not least, get a rough quotation for removal costs which are easy to gauge based on the size of your home and the distance you are likely to move.

4. Work out your budget.

By taking the original valuation sum given to you by the real estate agent and then deducting all of the totals from step 3 you will (hopefully) be left with a positive number! This is your clear profit, this is what you can then use towards your new home.

At this stage, if you have additional sums saved and you wish to add them to the above to increase your purchasing power you should do so. You will be left with an amount you can use as a down payment on your new home.

5. Get a loan agreed in theory.

Now you have to approach a mortgage lender and work with him to determine exactly how much you can comfortably afford to borrow. He will take into account many factors but these will include the amount you have as a down payment and the amount you earn. Ultimately he will arm you with a budget with which you can now work when searching for your new home.

6. Begin searching for your new house.

Now you have a budget to work with you can begin the exciting process of searching for a new home. It may seem dull to have to get all the financial facts and figures in place before heading off to find that dream house, but by doing all the ground work first you will be less likely to fall in love with an unsuitable, unaffordable home. You will not have set yourself up for a fall; you will once again have set yourself up for success.

7. Give your home a makeover!

Take the advice given to you by the real estate agents and get to work with the repairs, renovations and heavy work needed to bring your house up to the top of the market.

8. Find the best real estate agent.

Having already met and worked with real estate agents for the valuation of your home get back in touch with your preferred agent and ask them to revalue and then market your home. If you are in doubt about which agent to choose speak to any friends, family and colleagues in your local area who have recently bought, sold or rented property through an agent and ask for personal recommendations. You need to feel comfortable with the agent you choose to represent you, you need to make sure they will sell your house as quickly, efficiently, honestly and effectively as possible and that they are trust worthy to be left to show viewers around your home.

Once you choose your agent go through their entire marketing strategy for your home and make sure you are comfortable with their approach and that they are going to do everything required of them to assist you. Furthermore, ask them to revalue your home based on the work you have done to it and any market movements that have occurred in the interim.

9. Remember - first impressions count!

Now the time has come for buyers to begin viewing your home. You have to go over every single aspect of your home with a very critical eye and consider what the potential purchaser will make of every aspect. Their first impression of your home will be as they look at it from the sidewalk, ensure the outside of your home is as clean, tidy and well presented as possible and then walk through every room and the garden and look at it with fresh eyes. What will a buyer’s eye be drawn to, the beautiful proportions of the room or the dirty window and vase of dead flowers?

Because first impressions count so very much take the time to consider every aspect of your home and then make time to clean, polish and present your home in the very best light possible.

10. Be as flexible as possible.

If you can be quick to react to a viewing request and flexible when it comes to a contract completion date you will be doing everything within your power to enable your buyer. By remaining on top of the upkeep of your home you should be able to say ‘yes’ to a viewing request at the drop of a hat. And if you remain on top of your home search and are at least mentally prepared to move out swiftly – even if this means moving into rental accommodation for a short period – you will be doing absolutely everything within your power for home selling success.

About the Author

Rhiannon Williamson is the publisher of http://www.shelteroffshore.com/ - for offshore and international real estate investors.