Monthly Archives: February 2018

PRICING YOUR HOME CORRECTLY IN A COMPETITIVE MARKET

PRICING YOUR HOME CORRECTLY IN A COMPETITIVE MARKET

Imagine you want to buy a banana. You eye the produce section, shelves stocked with dozens of choices, but they are really all the same. A banana is a banana, and which one you select is not significant because they are all identical, and they are all priced the same.

What if each identical offering was priced differently? Odds are you have set aside ample time for your shopping trip to carefully check the prices and go for the best deal. Or maybe you are drawn to the more attractive packaging.

When selling your home, attractive pricing and packaging are arguably the two most basic essentials. In our current real estate market, the buyers have a lot of choices. In many areas, the shelves are simply overstocked. And since no two homes are the same, making that distinction between your home and the dozens of others is key.
Where pricing is concerned, establishing that all-important asking price is part science and part art, and there are several things you should consider.

Study past sales. This is the starting point for any thoughtful and successful pricing strategy; think of it as the research portion of your home selling experience. Take the time to study past sale statistics for homes in your area and areas like yours. None will be identical, of course, but having a clear understanding of true market value is the first step in establishing your list price.

Do not confuse active listings with past sales. Active listings have not sold. They are just your competition. It is important to be aware of your competition’s pricing, but this is often an indication of what your home will not sell for. Leave some room for negotiation, but do not overreach. No seller wants to feel he left money on the table, and no buyer wants to overpay. Your price should give both parties room to maneuver, but if it is too high, you risk being perceived as unrealistic, and buyers will pass over your home.

Think like a buyer. What are the things that you value in a home? Is it a large yard, an updated kitchen or a view? These are likely the same things that your buyer values as well. Talk to your real estate professional about current buyer trends. Your price should reflect how your home compares to the others offered for sale. Buyers will find objections to any home, as no home is perfect, but it is curious how quickly objections disappear when the price is compelling.

React swiftly and decisively. If your home is on the market and is not being shown or if you receive feedback that you priced it too aggressively, do not hesitate to adjust your price. Bad news, like a rotten banana, it does not get better with time.
First impressions are everything when selling your home. Studies have shown that the first two weeks on the market are the most crucial to your success. During these initial days, your home will be exposed to all active buyers. If your price is perceived as too high, you will quickly lose this initial audience and find yourself relying only on the trickle of new buyers entering the market each day. Markets are dynamic, and your price has an expiration date. You have one chance to grab attention. Make sure your pricing helps you stand out on the shelf — in a positive way.  ***

‘Keep It Simple’ Up Keep

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Using Traditional Light bulbs: If you still have incandescent light bulbs in your home, you could be throwing a lot of money away every month on inflated electric bills. Over its lifespan, an incandescent bulb can use $180 worth of electricity. A CFL will only use $41 worth of electricity over the same time period. Even better is the LED bulb, which only uses $30 per bulb.
Ignoring a Leaky Faucet: A leaky faucet that drips one drop per second can waste more than 3,000 gallons per year, which is enough water to take more than 180 showers. Some of us live in areas where water is plentiful, but for those of us in areas plagued with drought, this could be costing you a fortune. Fix or replace your leaky faucet and save a ton on your water bill.
Not Customizing Temperature: Invest in a customizable thermostat. If you are away at the office all day, you can program your heater to shift down a few degrees while you are gone and then shift back up shortly before you return home. Heating or cooling an empty home wastes a lot of money in energy costs.
Water Heater Temperature Set Too High: Unless you have a tankless water heater, your water heater is keeping the water in its tank hot 24/7. Decrease the temperature in the summer, and bump it back up when winter comes.  ***

Prepare For The Unforeseen Expenses Of Homeownership

Unforeseen Expenses Of Homeownership

Being a homeowner has been your dream since you were a kid and you finally accomplished it.

Then, moving day comes. Once all the boxes are unloaded, and the furniture is shoved roughly into the right rooms, you grab a coffee and take a breather. And that is when it dawns on you. This is only just the beginning.

As a new homeowner, there are whole lists of things you need to take care of, and almost all of them cost money.

So, if you are planning to buy a new home, have just signed the paperwork, or are moving in next week, this list is for you. And if you know someone who is moving in, be a friend and give them a heads-up as well.

Property Tax – Up to $10,000: When it comes to property tax, a lot of people get sticker shock a year after they move into a new construction. The reason for this is simple; the taxes are based on the empty lot the home was built on says, Local Records Office. But a year later, the assessors come around and put a new valuation on the lot, which now has a beautiful home sitting on it. You can also face much higher taxes based on the particular school district you live in. And of course, taxes vary greatly by state. The average property taxes paid in New Jersey are almost $7,500, as opposed to $1,500 in Colorado, as of 2017.

Major Appliances – Up to $10,000: New home builds usually include a dishwasher, microwave, and stove, with the option of a fridge/freezer, washer, and dryer. They are basic unless you opt for the upgrades in your contract, but if you do, they could add a chunk to your monthly mortgage payment. If you buy a used home, you may not have any appliances included.

HOA Fees – Up to $700 a Month: Many new homes come with a Home Owners Association, and most used homes have HOAs as well. In theory, they’re a sound idea. They are there to keep the neighborhood looking great, and deal with trash collection, playgrounds, community pools, street lighting, common areas, snow removal, and so on. A typical HOA can run $100 a month. Some are just a few hundred a year, while in the higher-end neighborhoods, you may not see much change out of $1,000 every month.

Insurance – Up to $2,000 Annually: There are a few different types of insurance you need to have when buying a home. First, you must have homeowner’s insurance. The average cost of this is around $700 annually, but this varies by state. You should also have contents insurance, based on the value of your possessions. You could, of course, skip this payment. But if tragedy does strike, you could lose everything.

Utilities – Up to $400 Monthly: Again, if you live in a mansion that figure will be greater. And in a new one-bedroom apartment, much less. But on average, when moving into a new home, you will see utility bills in the hundreds of dollars. This can be quite a shock, especially if you were formerly in a small apartment or even living with your parents.

Repairs and Maintenance – Unknown: One of the biggest unknown expenses of owning a home is the repairs and maintenance costs that can hit you out of nowhere. If you were formerly renting, that was all taken care of. Now it is all on you. If the hot water heater goes out, you pay. If the roof leaks, you pay. If strong winds blow your fence down, you pay.
Yes, being a homeowner is the American dream, but it does not always come cheap. There are a lot of hidden fees and expenses. If you make a plan to cover these expenditures, then you will be a well-prepared homeowner.  ***