The appearance of your home, a buyer’s first impression, and other considerations can also affect the sale of your home. Have you considered that home prices in your neighborhood and the value of your property are also factors used for pricing your home? When selling your home, there are no guarantees that a buyer will simply walk through the front door. In many cases you may have to bring your home to the buyer. Effective marketing will help ensure that your property receives maximum exposure to attract a ready, willing and able buyer.
Below are some articles that you might find useful in the home selling process. Please feel free to click on one the links to read more.
- Risks of Remodeling Without a Permit
- Traversing The Pitfalls of Home Inspections
- What is a CMA and Why Do You Need One?
- The Home Sale: Securing The Deal
- Seller’s guide
- Factors That Increase the Value of a Lakefront Location
Risks of Remodeling Without a Permit
Most cities require that homeowners obtain a building permit before making modifications to their residence. Which modifications require a permit vary by city. Also, some cities are more vigilant than others in enforcing permit laws.
In order for the homeowner to receive a permit, the homeowner or his/her designee are required to file plans and pay fees to the city. In addition, the improvements are given a value. If they increase the value of the property, this may result in an increase in property taxes. Inspections are often required, and this means having to schedule and then wait for inspectors to approve the work to be done. This process can be time consuming and inconvenient in the short run. It is for this reason that some homeowners skip the permit process.
If a permit is needed and you fail to get one, the city may discover this at some time in the future and getting a permit retroactively can frequently be significantly more expensive and much more problematic than having obtained the permit before work commenced. If work is not done in accordance with city procedures or if the inspector is unable to determine if the work has been done properly, the homeowner could be required to open walls, tear up floors, so that the inspection may take place. In addition, by law, work not permitted where a permit was required must be disclosed to any prospective purchaser. This may cause the owner to discount their sale price or perform costly or time-consuming repairs before title can be transferred.
For prospective buyers of a property, save yourself the future hassle and loss of money by researching whether all work on the premises has been done according to code and with the proper permits. You may obtain these permits by going directly to Building & Safety in the municipality in which the property is located or by hiring a “permit puller” who will research the permits for you.
copyright © Agent Image 2011
Traversing the Pitfalls of Home Inspections
June and Fred Smith were diligent about getting their home ready for sale. They ordered a pre-sale termite inspection report. The report revealed that their large rear deck was dry-rot infested, so they replaced it before putting their home on the market.
The Smiths also called a reputable roofer to examine the roof and issue a report on its condition. The roofer felt that the roof was on its last legs and that it should be replaced. The Smith’s didn’t want buyers to be put off by a bad roof, so they had the roof replaced and the exterior painted before they marketed the home.
The Smith’s home was attractive, well-maintained and priced right for the market. It received multiple offers the first week it was listed for sale.
But the buyers’ inspection report indicated that the house was in serious need of drainage work. According to a drainage contractor, the job would cost in excess of $20,000. Fred Smith was particularly distraught because he’d paid to have corrective drainage work done several years ago.
First-Time Tip: If you get an alarming inspection report on a home you’re buying or selling, don’t panic. Until you see the whole picture clearly, you’re not in a position to determine whether you have a major problem to deal with or not.
What happened to the Smiths is typical of what can happen over time with older homes. The drainage work that was completed years ago was probably adequate at the time. But since then, there had been unprecedented rains in the area, which caused flooding in many basements. Drainage technology had advanced. New technology can be more expensive but often does a better job.
The Smiths considered calling in other drainage experts to see if the work could be done for less. After studying the buyers’ inspection report, the contractor’s proposal and the buyers’ offer to split the cost of the drainage work 50-50 with the sellers, the Smiths concluded that they had a fair deal.
The solution is not always this easy, especially when contractors can’t agree. Keep in mind that there is an element of subjectivity involved in the inspection process. For example, two contractors might disagree on the remedy for a dry-rotted window: one calling for repair and the other for replacement.
Recently, one roofer recommended a total roof replacement for a cost of $6,000. A second roofer disagreed. His report said that the roof should last another three to four years if the owner did $800 of maintenance work. Based on the two reports, the buyers and sellers were able to negotiate a satisfactory monetary solution to the problem for an amount that was between the two estimates.
It’s problematic when inspectors are wrong. But it happens. Inspectors are only human. Here is another example: A home inspector looked at a house and issued a report condemning the furnace, which he said needed to be replaced.
The sellers called in a heating contractor who declared that the furnace was fit and that it did not need to be replaced.
The buyers were unsure about the furnace, given the difference of opinions. The seller called in a representative from the local gas company. The buyers knew that the gas company representative would have to shut the furnace down if it was dangerous. He found nothing wrong with the furnace, and the buyers were satisfied.
In Closing: Sometimes finding the right expert to give an opinion on a suspected house problem is the answer, but it is always good to get two opinions.
copyright © Agent Image 2011
What is a CMA and Why Do You Need One?
CMA is real estate shorthand for “Comparative Market Analysis”. A CMA is a report prepared by a real estate agent providing data comparing your property to similar properties in the marketplace.
The first thing an agent will need to do to provide you with a CMA is to inspect your property. Generally, this inspection won’t be overly detailed (she or he is not going to crawl under the house to examine the foundation), nor does the house need to be totally cleaned up and ready for an open house. It should be in such a condition that the agent will be able to make an accurate assessment of its condition and worth. If you plan to make changes before selling, inform the agent at this time.
The next step is for the agent to obtain data on comparable properties. This data is usually available through MLS (Multiple Listing Service), but a qualified agent will also know of properties that are on the market or have sold without being part of the MLS. This will give the agent an idea how much your property is worth in the current market. Please note that the CMA is not an appraisal. An appraisal must be performed by a licensed appraiser.
The CMA process takes place before your home is listed for sale. This is a good assessment of what your house could potentially sell for.
CMAs are not only for prospective sellers. Buyers should consider requesting a CMA for properties they are seriously looking at to determine whether the asking price is a true reflection of the current market. Owners who are upgrading or remodeling can benefit from a CMA when it’s used to see if the intended changes will “over-improve” their property compared to others in the neighborhood.
copyright © Agent Image 2011
The Home Sale: Securing the Deal
Ready to close the deal? Maybe not.
Sometimes unforeseeable issues arise just prior to closing the sale. Hopefully, with negotiation, most of these have a workable solution. Unfortunately, this is not always the case. But don’t panic. Another buyer might still be found who is willing to accept the house as is.
Imagine that your prospective buyers are a couple with young children. They envision your unused attic as the perfect playroom for the kids but, before closing the deal, they request an inspection to see if it’s safe and also if they will be able to install a skylight to provide natural light to the new space.
This inspection reveals that under the shingles that are in good condition is a roof that will only last another year or two. The prospective buyers immediately balk, not wanting to incur the time and cost of replacing the roof. Their plans were to move in and only have to spend time and money renovating the attic. The additional cost of the new roof, they say, is just too much.
At this point, you sit down with the prospective buyers and calmly discuss the situation and how it can be solved to the benefit of all. First, you agree to get another professional opinion on what really needs to be done. Inspectors are only human, and are not infallible. Once the extent of the damage is agreed upon, you can jointly decide what to do about it. While the buyers hadn’t planned on that expense, you show them that instead of a limited roof life that they would get with most existing homes, they’ll have a new worry-free roof that won’t cost them in repairs for the next decade or so. Since the roof wasn’t in as good shape as you had thought, you agree to lower the purchase price to help offset the cost of the new roof.
By negotiating calmly and looking at all possibilities, what could have been a “deal breaker” can be turned into a win-win situation for both the buying and selling parties. In other cases, the most workable agreement for both parties might be for the deal to be called off. The seller can always find another buyer and the buyer can always find another home.
To protect yourself against last minute “buyer’s remorse,” make sure the purchase contract anticipates and closes as many loopholes as possible after all known defects have been fully disclosed.
copyright © Agent Image 2011
Deciding to sell
Is it time to sell your property and move on to a new home? These are the signs that tell you you’re ready:
- Your needs have changed
- You have enough equity on your home
The best time to sell your home is when you have built enough equity on it. You can sell at a profit, which you can use in buying a new house, perhaps as a down payment or even a cash purchase. Find out how much your home is worth on the market today and see if selling it now makes good financial sense.
- You’re financially ready
If you have built enough savings for an emergency fund that can last you three to six months, and have no major loan or debt to pay off, then you most likely have the financial stability to buy a new house.
One of the most common reasons for moving is job relocation. Or it could simply be that you need a bigger home with more space for your growing family. Or, perhaps, you’re an empty nester and the home has become too big for you. If your lifestyle has changed in any way, that could be enough reason to make the move.
Preparation to sell
- Find a Realtor
- Get your home sale ready
Your Realtor can give you tips for preparing a house for sale. Go over the property with them to identify where repairs and improvements may be needed to help improve its value and make it more appealing to buyers.
Declutter and give your home a deep clean. Remove all personal items that can make it difficult for buyers to picture the property as their own.
Consider staging your home. Staging has been found to help a property sell faster and at a higher price.
The first step to take in selling your home is to find the right listing agent who can guide you through the process. Your Realtor can help you set the right price for the property, prepare it for the sale, negotiate with buyers, give you pointers on how to sell your home quickly, and more. In addition, real estate agents who belong to the National Association of Realtors can list your home on the MLS to give it the widest exposure nationwide.
We at Fazzone & Harrison Realty LLC will be happy to represent your home in Connecticut’s Northern Fairfield and Southern Litchfield Counties. With over 45 years of collective experience, we know how to help you close a sale with the highest possible profit. Call us today at 860.354.0479 or drop us a note here.
Pricing your home
Ask your Realtor to do a Comparative Market Analysis to help you determine the right selling price for your property. A CMA considers the prices of recently sold homes in your area, as well as your property’s strengths and weaknesses. In addition, your Realtor can also recommend a pricing strategy that can help you get the best profit.
Marketing your home
Your agent will develop a marketing plan that targets buyers looking for a home just like yours. Effective real estate marketing starts with high quality tools and materials, including professional photos, videos, and virtual tours, as well as well-written listing descriptions. Your Realtor may also promote your home through email campaigns, flyers, and advertisements in selected publications. They can also tap into their extensive network to find the right buyer.
Your Realtor will help you in screening buyers and making sure they have the right prequalification and financial soundness. In reviewing offers, keep in mind that the highest bid price may not always be the best offer. Look into the terms and conditions of the bids as well, including contingencies, earnest money, and others. Your Realtor will negotiate with potential buyers on your behalf, while always keeping your best interest in mind.
Escrow, inspections, and appraisals
Once you and the buyer reach an agreement on the price and terms of the sale, you sign a sales contract, and the process goes to escrow. The buyer’s earnest money and any cash payment will be deposited into the escrow account, and will be released only at closing.
During the escrow period, you and the buyer need to get all the contingencies in the purchase agreement removed within the specified time. The buyer will be doing most of the work, as they finalize the financing for the home and arrange for a home inspection. An independent home appraisal will be conducted by the buyer’s lender. If the appraised value turns out to be lower than the agreed selling price, the buyer may ask for a renegotiation or opt to get out of the sale.
Closing the sale
At closing, you and the buyer or your representatives will meet at a mutual location, typically the office of the title company or escrow agent. More paperwork will be signed and the necessary fees, such as commissions, escrow fees, and closing costs, will be paid. The lender then releases the funds of the sale to you, and the title and keys to the property are turned over to the buyer
If you’re thinking of selling your lake home in Connecticut, it’s important to learn about the finer points of pricing your property. Aside from making a comparative analysis of similar homes in the area, you may want to look into the factors that also affect the value of your lake house. For example, a home with a partial view can increase your asking price by 10 to 30%. However, a home with an incredible, unobstructed view of the lake can dramatically boost its market value anywhere from 75 to 100% of its worth in an ordinary location. Want to know more? Read this article for other useful insights on pricing your lake home for sale.