Why do you need a Pro in your corner?

With home prices on the rise and buyer demand strong, some sellers are tempted to try and sell their homes on their own without using the services of a real estate professional. This type of sale is referred to as a FSBO [fiz-bow]. 

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Investopedia breaks this acronym down:

'For Sale By Owner - FSBO'
The most common for-sale-by-owner transaction occurs in the real estate market when a homeowner wishes to avoid paying a large commission when selling their property. By not using a real estate agent, the seller assumes all the responsibilities of completing the transaction. 

Real estate agents are trained and experienced in negotiation and, in most cases, the seller is not. Sellers must realize that their ability to negotiate will determine whether or not they get the best deal for themselves and their families.

The idea of writing this Blog post came about because I called a gentleman last week that had changed his voicemail while his home was listed FSBO. I could hear the frustration in the sellers voice:

Hi you’ve reach the voicemail of James ______. If you are calling about the home on NW 81st for sale please DO NOT leave a message if you aren’t willing to pay full-price! If you are calling to get in and see the house please do not come knocking on my door because I didn’t answer the phone! This is not an invitation to trespass on my property! Leave a message and I will get back to you at a normal time. If you’re calling after 10:00 I will not be returning your call!
— James, FSBO Home Owner

It isn't hard to tell how frustrated James is with his home listing...

We spoke for a little while and I am going to be meeting with him late next week to see if I can help him. Even if he isn't interested in listing his home for sale with me, I feel it is only right to offer counsel to a man and his family if I can. 

Selling your home on your own is no easy task. Heck, selling a home as an agent is never easy... we just make it look that way! Lol. 

Before your home even gets listed for sale an agent should be investing a good portion of time in getting to know your home, the home sales and current listings in your neighborhood and compare the data to measure it against the current market. 

Listing a home for sale isn't a matter of knowing HOW MUCH a homeowner wants to make. When a agents agrees to sell your home they should be offering a certain level of expertise and professionalism.

Your agents primary concern should be: Is this the best decision for you and your family?!

Here is a list of some of the people with whom the seller must be prepared to negotiate if they decide to FSBO:

  • The buyer who wants the best deal possible
  • The buyer’s agent who solely represents the best interest of the buyer
  • The buyer’s attorney (in some parts of the country)
  • The home inspection companies, which work for the buyer and will almost always find some problems with the house
  • The termite company if there are challenges
  • The buyer’s lender if the structure of the mortgage requires the sellers’ participation
  • The appraiser if there is a question of value
  • The title company if there are challenges with certificates of occupancy (CO) or other permits
  • The town or municipality if you need to get the CO permits mentioned above
  • The buyer’s buyer in case there are challenges with the house your buyer is selling
  • Your bank in the case of a short sale

Bottom Line
The percentage of sellers who have hired real estate agents to sell their homes has increased steadily over the last 20 years. Meet with a professional in your local market to see the difference they can make in easing the process.

5 Ways Tax Reform Has Impacted the 2018 Housing Market

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Starting late last year, some predicted that the 2018 tax changes would cripple the housing market. Headlines warned of the potential for double-digit price depreciation and suggested that buyer demand could drop like a rock. There was even sentiment that homeownership could lose its coveted status as a major component of the American Dream. 

Now that the first quarter numbers are in, we can begin to decipher the actual impact that tax reform has had on the real estate market.

1. Has tax reform killed off home buyer demand? The answer is “NO.”
According to the Showing Time Index which “tracks the average number of buyer showings on active residential properties on a monthly basis” and is a “highly reliable leading indicator of current and future demand trends,” buyer demand has increased each month over the last three months and is HIGHER than it was for the same months last year. Buyer demand is not down. It is up.

2. Have the tax changes affected America’s belief in real estate as a long-term investment? The answer is “NO.”
Two weeks ago, Gallup released its annual survey which asks Americans which asset they believed to be the best long-term investment. The survey revealed:

“More Americans name real estate over several other vehicles for growing wealth as the best long-term investment for the fifth year in a row. Just over a third cite real estate for this, while roughly a quarter name stocks or mutual funds.” 
— Gallup

The survey also showed that the percentage of Americans who believe real estate is the best long-term investment was unchanged from a year ago.

3. Has the homeownership rate been negatively impacted by the tax changes? The answer is “NO.”
Not only did the homeownership rate not crash, it increased when compared to the first quarter of last year according to data released by the Census Bureau.

In her latest “Z Report,” Ivy Zelman explains that tax reform didn’t hurt the homeownership rate, but instead, enhanced it:

“We have been of the opinion that homeownership is most highly correlated with income and the net effect of tax reform would be a positive, rather than negative catalyst for the homeownership rate. While still in the early innings of tax changes, this has proven to be the case.”
— Ivy Zelman, Zelman & Assoc.

4. Has the upper-end market been crushed by new State and Local Taxes (SALT) limitations? The answer is “NO.”
In the National Association of Realtors latest Existing Home Sales Report it was revealed that:

  • Sales between $500,000 and $750,000 were up 4.5% year-over-year
  • Sales between $750,000 and $1M were up 15.1% year-over-year
  • Sales over $1M were up 17.3% year-over-year


5. Will the reforms in the tax code cause home prices to tumble over the next twelve months? The answer is “NO.”
According to CoreLogic’s latest Home Price Insights Report, home prices will appreciate in each of the 50 states over the next twelve months. Appreciation is projected to be anywhere from 1.9% to 10.3% with the national average being 4.7%.

Bottom Line
The doomsday scenarios that some predicted based on tax reform fears seem to have already blown over based on the early housing industry numbers being reported.