The residential home sale business had another record-breaking year in 2004. Interest rates remain low, and the expectation is the home sale market should also do well in 2005.
However, in some areas there is evidence that the housing market could be cooling. Inventories, which have been tight for years, are easing in places like Las Vegas and Los Angeles. Mortgage rates are poised to rise this year. How much is anyone’s guess. Most experts agree that a substantial increase in rates will slow market activity.
So, how do you take advantage of a good market and sell while the market is still good? Putting your home on the market early in the year could be the key to success.
Most sellers defer selling until spring, when gardens are blooming and the sun is shining. But, if you wait until the end of May or June to put your home on the market, you could run into a summer slowdown as vacation activities take precedence over home buying.
Your home has a better chance of selling quickly and for more money if there is less competition from other listings. Inventories of homes for sale are usually quite a bit lower early in the year than they are in late spring and summer.
Most homes need some fix-up for sale work, which takes time. So, even if you’re planning to sell your home in March or April, you should start planning now. Just de-cluttering is time consuming, especially if you have lived in your home for years.
It may make sense to do more than just clearing out and cleaning before you put your home on the market. A relatively small capital investment can result in a big profit when you sell. Cost-effective cosmetic improvements like paint and replacing outdated light fixtures and floor coverings are your best bet.
Your aim should be to get your home in good enough shape so that buyers can visualize themselves moving in without having to do much work. On the other hand, taking on major renovations usually won’t give you a good return on your investment.
HOME SELLER TIP: The key to a successful sale in 2005 will depend on how realistic you are about the current market value of your home. It’s natural to want to sell for the highest price possible. However, selecting an over inflated list price could be counterproductive if you’re serious about selling. Listings that are over-priced for the market usually don’t sell.
The list price should be based on sales activity in your neighborhood within the last six months. The more recent the sale, the more reflective it will be of current market conditions. Wild over-bidding during the last several years produced some exorbitant sale prices for considerably more than the list price. Rather than base your asking price on an aberrant high sale price in your neighborhood, it’s more realistic to drop that sale from the list and consider others sales as indicative of market value.
Providing pre-sale inspection reports can reduce the hassle of selling. If the buyers have a good idea of the condition of your home before they make an offer, there is less chance that they’ll back out because of a property defects. Pre-sale inspection reports also tend to reduce the renegotiation that can occur after the buyers perform their inspections.
THE CLOSING: Be sure to set up a showing procedure that makes it easy for real estate agents to show your home. Also, it’s best to leave your home when it’s shown. Your presence can stifle the selling process.
Dian Hymer is author of “House Hunting, The Take-Along Workbook for Home Buyers” and “Starting Out, The Complete Home Buyer’s Guide,” Chronicle Books.
***
What’s your opinion? Send your Letter to the Editor to opinion@inman.com.
