Stephanie Peat : DFH Real Estate - Sidney : Archived blog posts for : April 2011

How to Write a Great Offer in a Buyers' Market

Posted on April 18, 2011 by Elizabeth Weintraub-About.com

Simply put, buyers' markets exist when there are a lot of homes on the market and very few buyers. If inventory--the number of homes on the market in your neighborhood--has been rising, it's likely that the days on market have been increasing. Couple that with declining sales figures over previous months, and home buyers are in an enviable position to negotiate. Here is how you can write a buyer's offer to your advantage.

1. Request E-Mail Listings & Updates

Almost 80% of home buyers today start a home search online. However, many buyers are unaware that the data they are viewing could be dated. Many Web sites reboot every 24 hours. On other sites, agents sometimes leave expired and sold listings as active, hoping for ad calls. To avoid wasting your time, ask your agent to register your e-mail address so you can receive daily MLS changes of reduced prices and new listings. This is one way to gain access to the same data agents receive.

2. Tour Price Reductions

If you're like most buyers, you will want to offer less than asking price. It's just human nature. But if you plan to low ball, you'll probably be unsuccessful at getting that type of offer accepted if the home was just listed. Instead, tour homes that have had recent price reductions or have been on the market for at least 30 days or more. These sellers are more likely to be receptive to a low-ball offer.

3. Obtain Comparable Sales

When you find a home you want to buy, ask your real estate agent to print out a list of similar homes in the same neighborhood over the last six months sorted by:

Active Listings
Pending Sales
Sold

The list should contain the following specifics:

Property Address
Age
Square Footage
Lot size
Bedrooms & Baths
Sales Price

Compare this data with online home value sites such as Zillow and RealEstateABC, and you'll see first-hand why the data your agent gives you will be more accurate.

4. Request Contingencies

In a buyers' market, you're in control. Write your offer contingent upon the property appraising at the agreed upon sales price and on obtaining your loan. Check with your lawyer to find out if you can ask for a loan contingency that will protect you all the way to closing. Ask for a reasonable period to conduct inspections and to approve title, geological and pest reports. Ordinarily, during contingency periods, buyers can back out without risking a good faith deposit.

5. Ask for an Allowance or Credit

If you find the perfect home but you don't like the color or condition of the carpet, for example, ask the seller to give you a carpeting allowance in your offer. Check with your lender before you write the offer to find out how to word a credit clause that is acceptable to the lender. You can ask for more than it will cost to repair or replace an item to cover your "hassle" factor. Many lenders let borrowers receive up to 6% of the sales price as a cash credit against closing costs.

6. Reduce Your Closing Costs

Depending on your local area, there may be fees associated with closing that are customarily paid by the buyer such as title insurance, property taxes, recording fees or escrow. In a buyers' market, you can ask the seller to pay those closing costs. Typically, those costs can add up to one or two percent of the sales price and are often paid out-of-pocket by buyers. Ask your agent if these fees are negotiable. Then ask the seller to pay them.

7. Renegotiate After Home Inspections

All buyers should obtain a home inspection. Most contracts give buyers the right to cancel a contract if the home inspection reveals repairs or defects that are unacceptable to a buyer. However, if the repairs are minor, you might want to renegotiate the sales price or ask for a credit against your closing costs. Caution: don't ask for a price reduction if the repairs were evident when you first saw the home or the seller might not be willing to negotiate with you.

8. Request Extras

Sellers realize that in buyers' markets, often they have to give a little something extra to the buyers to entice a sale. Don't be afraid to ask for a home warranty protection plan that covers you in the event an appliance breaks down or the plumbing or heating malfunctions. Normally these plans protect you for one full year from the date of closing.

9. Ask for an Item You Don't Want

Did you like the sellers' dining room table? China cabinet? Fish tank? Ask for it in your offer and use it as a negotiating tool. Often this draws the sellers' thoughts away from price and directs those thoughts toward the personal property. If the listing stated the washer and dryer are not included in the sales price, ask for them. If the sellers balk, tell your agent to say, "OK, if we leave the washer & dryer, are you then ready to sign the offer?"

10. Shorten Acceptance Period

There often is no reason to give a seller more than 24 hours to make a decision about your offer. If your agent is presenting the offer in person, she may ask for a decision upon presentation. But don't give them days to talk to Uncle Harry, their neighbor down the street or the coworker who knows everything about real estate. There are a lot more homes on the market and you deserve a fast answer.

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Tips on Making your Property More Marketable

Posted on April 10, 2011 by Stephanie Peat

For many homeowners, the concept of professional home staging is shedding new light on how to promote a home in their real estate marketplace. If you’re thinking of selling your home, deciding on the best ways to organize your property before the “For Sale” sign is erected can help sell your home faster and at a higher price. Following are some home staging tips:

1. Make an impression. Prospective buyers make up their minds about your house even before they get out of the car. To ensure they have the right idea, clean up your yard, get rid of unsightly weeds, and sweep/shovel your driveway and porches. Get out the rags and cleanser and spend 30 minutes scouring your front door, porch, railings and steps. Then tuck away all your recycling cans and bins at the back of the house or in a corner of the garage.

2. Declutter. A common phrase used to describe the importance of decluttering is: Clutter eats equity. So purge your closets, empty cupboards and box up small appliances. You may even want to rent a storage locker to keep items you simply cannot part with, while throwing out items you’ve collected over the years that you don’t want to take with you to your next home. This will also save you time during your big move. Ensure you pay close attention to your countertops and coffee tables as well.

3. Impersonal works. You want buyers to imagine themselves living in your home, so stash anything connected to your family or personal interests. Hide your son’s hockey trophies, store family photos and remove all traces of day-to-day life. This also includes removing personal effects from the bathrooms.

4. Keep it fresh. There’s nothing worse than stepping into a house that smells of smoke,

dampness or pet odours. The easy solution is to keep your windows open for 10 minutes a day. This strategy works better than deodorizers since a lot of people have allergies to artificial room fresheners. The oldest trick of all? Leave chocolate chip cookies baking in the oven. Yes, it’s hokey, but the smell does do wonders to help buyers bond with your home.

5. Declare war on grime. Cleanliness helps put a buyer’s mind at ease since it suggests that you’ve probably taken good care of your residence in other ways as well. So clean everything: walls, door handles, light fixtures and pantry cupboards. And don’t forget to dust your furnace room and furnace, since this makes your furnace look newer. Power washing windows, walkways, eavestroughs and pathways can also do wonders for your home’s exterior.

6. Hire a handyman. If you don’t have the time or expertise to deal with the aesthetics of your home, consider hiring a professional. Dripping faucets, cracked tiles and mouldy caulking around the bathtub can knock thousands of dollars off the price of your home.

7. Colour it up. Your single best investment may be a fresh coat of paint in key areas of your home. Try painting your front door and placing some urns containing seasonal arrangements on your front step or just inside the entryway. Remember that small touches can make a house seem cared for and important.

8. Reduce furniture. An easy way to create a sense of space is to get rid of some furniture. Moving a sofa and end tables into storage can give a small room some much-needed breathing space. If your furniture dates from the Mulroney era, consider packing it away and renting or borrowing some modern, stylish furniture or a couple of well-chosen pieces of wall art. Keep your rooms clean and simple like a hotel room or the showroom for a new house.

9. Lighten up. The brighter and sunnier a space, the easier it is to sell. If you don’t have the time or energy to clean all of your windows – inside and out – it may be a wise investment to hire a professional window-cleaning company. Thoroughly clean the shades on your light fixtures, change light bulbs and add floor lamps if an area seems dim. Finally, when it comes time to show your home, make sure all the lights are on, especially in hallways.

10. Add a touch of humanity. A couple of planters containing seasonal arrangements on your front porch, a vase of flowers on your dining room table, or even a simple rose in a vase can warm up a room. Candles can also do wonders in lighting and warming a room.