Neutralizing Your Home

We have been in our home for 20 years and, in that time, have made it our own. We’ve painted bedrooms colors to please our kids and enjoyed decorating according to our tastes.  My husband is relocating so we have to sell.  Is it important to get rid of the colors which we love?

The colors that you love, that are specific to your taste and lifestyle, will not necessarily be the colors that others appreciate. Your job in selling is to make your property appeal to as many buyers as possible and neutralizing your home will do that.

This includes not only repainting walls and woodwork with an off white color. It also involves removing family photos, collections and trophies, replacing old and bright area rugs with more toned down ones and scraping off colorful or busy wall paper and borders.  Your purpose is to create a clean, simplified background – a home that buyers can visualize themselves in.

You may feel like offering an allowance to potential buyers to pick their own carpeting and paint makes more sense. But, purchasing a home is an emotional decision.  Buyers need to love your home when there.  Too much color and personal items can get in the way of them appreciating the beautiful home you’re selling.

I suggest that you contact a real estate agent who will help you make decisions about what colors to use and what to remove. She is in the business of helping sellers make their homes as appealing as possible to the most buyers.  In doing so, she will guide you through the repainting/removing/decluttering process step by step.  And then, before you know it, you will be packing and moving on.

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Seller’s Property Disclosure

We just met with a real estate agent to talk about selling our home.  She gave us a 9 page document to complete called the Seller’s Property Disclosure.  Answering the questions will take a lot of time and I don’t know how to answer some of them.  How important is this form? 

The Seller’s Property Disclosure is a thorough questionnaire of every imaginable aspect of your home and property.  It is very important.  By completing it, you as the seller, are able to provide information about your home that will help the buyer determine the condition before purchasing it.

For example, if your home is older, a buyer will want to know if the roof is the original.  Your answer to the question, “When was the roof installed?” will help the buyer know if he will need to replace it in the next few years.  There are questions about water leaks, plumbing lines, HVAC systems, septic tanks, home alterations and hazardous substances – lots of questions which need to be answered to the best of your knowledge.  If you honestly don’t know the answer, you can mark the unknown box.

In the state of Pennsylvania, this document must be completed by sellers and available for buyers when they sign a contract on your home.  Although time consuming to complete (yes, dig out old invoices to verify your answers), it is important to disclose any and all information on every aspect and to give an accurate and complete picture of the condition of your home.  Completing it thoroughly and honestly goes a long way toward giving buyers peace of mind.  And buyers that feel confident about the condition of your home will be more prone to purchase it.

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RADON TESTING

We are thinking about selling our home. We don’t have a radon removal system in our house. Will this get in the way of selling?

Part of selling a home is allowing the buyer the opportunity to hire professionals to conduct inspections. Your buyer will almost always hire a radon testing company to test for radon if you do not have a system in place. Usually this involves placing a test monitor box in the basement of the home which reads radon levels hourly for 48 hours. The average reading for that time period is used to determine if your home is safe.

Radon is a colorless, odorless, tasteless gas that is not recognized unless you test for it. It is formed by natural radioactive decay of uranium in rock, soil and water. Once produced, it moves through the ground to the air above. It is considered to be the second leading cause of lung cancer in our country. Breathing it does not cause any short-term effects such as shortness of breath, coughing, headaches etc but the risks to long term exposure can be great.

The EPA has determined that a radon level of 4.0 or higher is unsafe. Therefore, if levels are higher than 4.0 when your home is tested, your buyer will usually request that you, as the seller, hire someone to install a radon mitigation system. The cost for this system is about $1,000 and includes installing a pipe from below the basement floor through the roof with a motor that moves gases up and out.

Radon testing is one of the many steps in selling your home. A good agent will help you through the ins and outs of all of the steps until a sold sign is up and you’re packing and moving on.

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Price it Right

We recently met with a real estate agent to discuss selling our home. We were surprised at the price she suggested as we were thinking we could get at least $20,000 more. Shouldn’t we begin high with a price and go down if we have to?

Your logic seems to make sense and I hear it frequently from sellers – “Let’s begin high and then we have room to negotiate down.” It’s understandable as well because, of course, you want to get as much as you can for your home.

There are a few problems with this thinking, however. In our digital world, sold prices are common knowledge to all. Buyers know what homes are selling for. They know that your neighbor’s property, similar to yours, just sold for $280,000 in the spring. So why would they pay $300,000 for yours?

Most buyers do not want to offer substantially less for a home, even if they love it or can afford it. Instead of offering less, they will usually move on to another home which they feel is priced realistically.

Another factor is the appraisal most buyers will need in order to get a mortgage. Even if you get a buyer who is convinced your home is worth more, if the appraiser (who has to use sold prices to determine the value of your home) decides it’s not worth that much, you may need to come down anyway so your buyer can get financing.

Trusting your agent to price your home appropriately is only the first step in selling it. You are also hiring her to help you prepare it to sell, market it well and guide you through the process to settlement.

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List Now or Wait for the Spring?

We have been working all summer to prepare our home to sell and plan to list it sometime in the fall.  However, my sister told me we should wait until the spring because that’s the time most people buy.  What do you suggest? 

It is generally understood in real estate that spring is the best time to sell.  But that does not necessarily mean you should wait until spring to list your home.  In fact, because many are waiting, there are more homes for sale in the spring and the competition is greater. If, as you said, your home is ready to put on the market, then I would consider doing that early in September after folks are back from summer vacations and life is less busy for prospective buyers.

Next to spring, fall is the busiest real estate season.  Autumn offers certain benefits to home buyers, including year-end tax breaks (both mortgage interest and property taxes are deductible from gross income) and pleasant weather conditions for moving.  Buying a house before the deep freeze of winter sets in is very appealing to most.  Moving is hard enough without dealing with icy roads, snow storms or sweltering summer heat.

It is important to meet with a good real estate agent to discuss how to best stage your home, price it correctly and market it well.  Her expertise will have you packing and moving on before the long, dreary winter.

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Rent or Buy?

My husband and I have been renting since we got married a few years ago.  Our landlord is not renewing our lease so we need to find another rental.  When searching, we have not found anything decent for an affordable price.  A friend of ours recently purchased a home and suggested we do the same.  Why are rentals so high and is buying a better idea? 

Rental properties have increased in price in the last few years because of supply and demand.  More people are renting for several reasons:

1 – Those who have foreclosed or short saled their properties are not able to purchase because they cannot get a mortgage for a time.

2 – With home values plunging in 2008, some are not convinced that purchasing is a good financial decision.

3 – With mortgage companies tightening up on who qualifies for financing, it is more difficult to get a mortgage.

I suggest if you plan to stay in the area a few years,  that you look into purchasing. If you have good jobs and credit, contact a reputable real estate agent in the area you want to live to discuss the process.  Before you know it, you will be unpacking boxes in your own home (instead of someone else’s) and building equity instead of financing your landlord’s property.

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Appraisal Problems

We put our home up for sale and had a buyer within two weeks with a price close to what we were asking.  About four weeks later, we found that, because the appraisal came in lower than the purchase price, the buyers were not interested in paying what they said they would pay on the contract.  How can someone sign a contract agreeing to a certain amount and then change their mind? 

Most home buyers are purchasing with a mortgage because they don’t have the money to buy without borrowing from the bank. If this is the case, the contract will be contingent on a mortgage which means, if your buyers are not able to get the mortgage, they are not able to buy your home.

Part of the mortgage process is an appraisal, a value given to your home by a licensed appraiser.  He makes an appointment to come by your house, measures, evaluates and finds other properties similar which have sold in the last year.  His report places a value on your home which the bank uses to determine what they will lend you.  If that value is less than what you agreed to pay for the house, your buyers have the right to offer less or purchase elsewhere.

As the seller, you can hold to your price and hope the buyers see the value and have money to pay the difference.  However, if you do this, you risk losing your buyers which means you’re back to square one with showings, hoping for another buyer.  And, unless higher valued homes are scheduled to settle in the near future, this scenario may be repeated.

In this market of lower values, appraisals can get in the way of contracts, especially if homes which have sold in your area are not of the quality or location of yours.  A good agent will guide you through the process, working hard to bring you the most value for your property with the least headaches.  Then, before you know it, you will be packing and moving on, with the appraisal issue only a faint memory.

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