Selling Your Home In A Slowing Market
If you decide that now is the time to sell your home, you may find that it's more difficult than in recent years.
Signs of a softening real estate market continue to surface. But Kiplinger's Personal Finance magazine contributing editor Vera Gibbons says there are steps you can take to make your home more marketable — even if the scales have tipped toward buyers.
She spelled out some of them on The Early Show Monday.
The steps she outlined to co-anchor Harry Smith included having lower expectations in this cooling market; pricing your home right, which may mean lower than you anticipated; staying flexible with your buyer; creating curb appeal by fixing up the outside; getting rid of clutter, inside and out; and bringing in an inspector and a handyman to fix what needs fixing.
Gibbons says the markets that appear most vulnerable are the one that have been most overheated, "particularly on the West Coast, the California market, San Francisco, San Diego, L.A.; and, on the East Coast, New York, Washington, Boston. Sort of the usual suspects."
What's a seller to do?
Gibbons gave details on her main points:
Lower expectations: "Sellers in some markets are finding they have to lower their price, sometimes several times over, to move the property, particularly if you are in a luxury market. If you're reluctant to do so, your house may stay on the market for months and months and months," she says. "Buyers don't like that. They're much more clued into time-spent-on-market than in the past; if it's been sitting there awhile, they're going to walk away. And they can in this environment."
Price it right: "Take a look at what prices are going for in your neighborhood now — not what they went for a year ago or six months ago, but how much stuff is going for now. Also, take the condition of your house into consideration. If you need a new bathroom or kitchen; if your home has deficiencies and historically, buyers negotiate $2 for every $1 of deficiency. So you've got to price your home appropriately, taking that into consideration."
In particular, Gibbons advises, focus on "comparable homes in your area. And pay attention to how much time you're spending on the market."
Stay flexible: "You don't want to judge the offer on price alone. You want to take other factors into consideration. A buyer might come to you and say, 'We want your house, and we'd actually be willing to let you rent it from us until you find a new place to live.' That could be worth its weight in gold to a prospective seller."
If opportunity knocks in a market like this, grab it, she says.
Improve curb appeal: "In a cooling market, curb appeal does become increasingly critical. Buyers don't want to see a messy lawn, overgrown shrubs, dirty trash cans by the entryway. That's an issue. You have to make your home look welcoming, inviting, right from the get-go."
Rid your house of clutter: "Buyers don't want to see a lot of junk around. If you have dirty, old carpeting, if you have old wood paneling, you might want to consider removing and replacing. Little things like that may cost you a few thousand up front but could boost your asking price by tens of thousands of dollars."
Bring in an inspector and handyman: "You should do so in this environment. You want to make sure everything is working properly, from your air conditioning to your water heater — all of that stuff. Bring an inspector in to check for malfunctions. If anything's not working, make sure it's working. Similarly, if you have leaky faucets, if you have doors that are off the hinges, bring in a handyman to take care of it, or do it yourself."