My Blog

Finding the right price for your home can be a complicated process, made only more challenging if you are looking to sell quickly.  When considering a price, there are a number of factors that you should keep in mind.  The most important factors to consider are the area around your home, the average home price for a similar home, and the current state of your home.

From here you can get a price that will then be modified downward by your need to sell quickly.  Let’s take a moment to review the steps you can take to correctly price your home to sell.  With any luck, you will leave this article with a better understanding of your next step through this complex process.

Consulting With a Realtor

For many people who consider a realtor, the first thing that comes to mind is the price tag.  Like it or not, however, a realtor can bring a great deal of expertise to your problem, providing a tangible solution to the right price for your home when you are trying to sell it quickly.  A realtor will help walk you through how the four conditions (home, quality, location, and price) will influence your final asking price.

In addition, they will be able to make you aware of any potential problems or advantages within your local market.  Along with providing you a great deal of information relating to the process, a realtor will also save you the time you would otherwise spend listing, and then relisting your home if your guessed price does not bring any interested prospects.

Be Quick and Negotiate

Every moment your home is on the market is a financial loss.  The quicker you go about the process of getting a realtor and listing your house, the less time will be wasted overall.  Along with financial consideration, there is also the issue of image.

There is a tendency to view homes that have been on the market for an extended period of time as less attractive simply because they have been on the market longer.  When pricing your home to sell, give yourself room to negotiate with a prospective buyer.  For example, you can sweeten the deal by adding an additional amount off or another incentive to get them to buy quickly.

Focus Your Price on the Local Housing Market

No matter what is happening on a state or national level regarding home sales, never forget what the current needs are within your local housing market.  Identifying these needs by yourself or with a realtor will give you a better understanding of why other houses are selling for the amount listed, and what you can do to price your home competitively.  Once again, a realtor is the best source of information for your local housing market.

How does your real estate agents use email?

If you’re just sending weekly property listings to your clients, then you’re missing out on the great relationship-building potential an email marketing campaign can offer.

Like most small businesses, real estate depends on nurturing strong relationships with your clients. The better you respond to your customer’s needs, the more they’ll trust your guidance during their major life decision. And that trust can lead to a better sale.

While the bulk of real estate relationships are built-in person, it’s easy and natural to extend that relationship into your client’s email inbox too. Let’s take a look at five different kinds of content you can send that go beyond the basic property listings and speaks to your customer’s needs.

Home Buying Tips

Buying a house is a big commitment that comes with plenty of questions and considerations for your buyers. You can probably answer all the questions from a first-time home buyer in your sleep!

Use your email campaign to address these common questions and lead them through important tips to consider, like:

Choosing an agent

Financing – What kind is right?

What are the points and closing costs?
Negotiating a lower price – Getting seller concessions, making counteroffers
The total cost of ownership, beyond the mortgage basics
Appraisals
Home age – Should I buy a newer or older home? What are the trade-offs of each?

Local Factors – Where Should I Buy?

Proximity to work or school is only one consideration for new home buyers when they’re comparing locations. The neighborhood, local attractions, school districts, and other demographics also play a role.

Help your clients decide on the best location for them by addressing some of these concerns in your emails:

The relative cost of housing in the area
Quality of public services (education, water, sewer, parks)
Age of the community – Young families may prefer neighborhoods with children, while an older couple might prefer a quiet area.
The mean and median income
Entertainment venues (theaters, concerts, sports, restaurants)

Profile a new township in a monthly newsletter with some highlights of who would feel most at home there.

Market Trends

Buying or selling a home is usually a long and involved process. By the time your client is ready to close on their home, the buying and selling market might look completely different than it does right now.

Keep your clients up to speed on market performance. Is it a better time to buy or sell right now? You can also discuss other factors that influence the market, like:

Unemployment
Interest rates
Foreclosure rates
Seasons

Transparency about the housing market can also help your clients trust your input more.

Home Maintenance Advice

Closing on a home sale might be the end for you, but it’s just the beginning for your clients. A new homeowner might feel overwhelmed with new responsibility for a big property.

Make the transition easy with tips on home repairs and installations your new owners should invest in.

When to replace windows
Comparing different types of flooring (hardwood vs. carpet vs. tile vs. linoleum)
Comparing wall treatments (wallpaper vs. paint vs. paneling)
Different heating systems (gas vs. oil vs. electric)
Plumbing considerations
Roofing comparisons (slate vs. asphalt shingles vs. clay tiles)
Exterior design (brick vs. siding vs. stucco vs. paint)

Discuss ways these improvements can make your client’s home a worthwhile investment.

Success Stories

Getting testimonials from other satisfied customers adds credibility to your marketing campaign and makes it feel more human.

People trust the opinions of other people. So give your previous clients a voice in your emails. Include testimonials about your customer service. Have a customer write about how easy you made their home buying process, or how you eased their first-time-buyer fears.

Featuring feedback from your customers shows that you’re an expert too: People who turned to you for advice are willing to recommend you based on that advice. Featuring your positive feedback can lead to more good reviews – and more business! – In the future.

Keep Building the Relationship

An email marketing campaign built on addressing your clients’ needs builds a strong relationship that can lead to more referrals and business later on. Think about what a new home buyer needs to know and frame your campaign content around common buying and selling questions.

When you anticipate your customers’ needs in the inbox, you’ll be the first agent they turn to the next time they need quality service.

I’m getting a lot of phone calls asking about articles people are reading in different publications. I’m also talking to people who like most of us are hearing all of the terrible stories on the TV news regarding the mortgage/credit crunch but not paying complete attention because it doesn’t affect us. That may be wrong…you may think it doesn’t affect you because you’re responsible and have great credit in real estate.

What I’m telling you is you may want to check around if you have an ARM coming due and see if you’re as good as you think you are. Better safe than sorry. Here is my advice. If you have a 3-5 or 7 year ARM (adjustable-rate mortgage) that is coming due in the next 12 months it might not be a bad idea to give your lender a call and see what your best course of action is.

The reason I want you to know this and do this is with all the horror stories we are hearing about foreclosures and short sales the banks are protecting themselves and tightening up the criteria in order to purchase AND refinance. If you were banking on the equity in your home to help you along when you refinance it may not be enough 12 months from now.

What was 5% minimum down is quickly becoming 10% down…….and if your property is in a declining market then there is a chance you will need to add another 5% on top of that. So what once used to be 5% down and something you can handle could quickly become 15% and something that will prevent you from refinancing.

How is that helping???

I know the banks are in as much trouble as a lot of homeowners but a lot of these people are trying to refinance into 30 year fixed mortgages. These people are trying to do the right thing…..the kicker to this whole thing is these decisions are not being based on your credit score.

While this is still important in getting the best rate it is not swaying the banks on their down payment requirements. They are making these decisions on the area, not the borrower’s credit score.

So talk to you lender is you’re planning on refinancing and ask the following questions:

1. How much am I going to need to put down in order to refinance?
2. Can I use the equity in my house and will it be enough?
3. What closing costs are associated with refinancing? Can I roll them into the mortgage?
4. What is a declining market? Will it have an effect on my refinancing?
5. Should I do this now before things get tougher and I may not be able to refinance?
6. What is the worst-case scenario?

I do this in no way to scare you but to make you aware.
This type of situation has mainly had an effect on people who put little to no money down within the past 3 to 5 years….did interest-only loans…..and did ARM in order to keep the payment as low as possible. In order to refinance, they will need to use the equity in their home in order to put money down again and acquire a fixed mortgage. As we’ve been hearing the equity may not be enough.

Hope this helps….it is getting tough out there and it in many ways has nothing to do with you or your ability to pay the loan back. It has to do with the fact that most of Chicago and the Suburbs of Chicago are in a declining market and the banks are freaking out!!! Let me know if you have any questions.

I wanted to update everyone from an earlier post. Back in February the City of Chicago passed an increase in the Real Estate Transfer Tax Stamp that was to be paid by the buyer. It was an additional $3.00 per $1,000 spent on top of the $7.50 per $1,000 spent that already existed. An increase of 40% in mid-March a bill was passed changing the less than one-month-old previous bill which now put the burden of the tax increase on the seller.

So instead of the $10.50 is paid entirely by the buyer it is now split $7.50 per $1,000 by the buyer and $3 per $1,000 by the seller. On top of this for the seller is the $1.50 per $1,000 spent that they pay the county and state. As stated in my earlier post this was all to help bail out the CTA (Chicago Transit Authority.)

Problem solved. Right, I argued earlier that the tax was unfair to buyers (especially first-time buyers) and that it was going to have a negative effect on an already difficult real estate market. So what is wrong with hitting the sellers? Well to begin with they already paid the $7.50 per $1,000 when they purchased.

So really doesn’t matter how you split it you’re still going to have to pay it either on the way in or on the way out. So current homeowners looking to move are the guinea pigs that are being hit with this tax twice Secondly they already pay $1.50 per $1,000 to the county and state when they sell and now this is on top of that. Glad to see they came up with a solution that was fair for everyone…yeah right!!

As long as we keep seeing “The Governor” at Cubs games and Bulls games we’ll be doing just fine. As I’ve said before and I’ll say again…it is easy to complain after the fact. What we really need to do is stay involved when the decisions are being made and voice our collective opinion then.

A lot easier to stop things before they go into effect Just wanted to update you on the situation. Good news for home buyers is effective April 1, their transfer tax for purchasing real estate in Chicago remains at $7.50 per $1,000 spent. Any clarification just let me know and I’d be happy to help. I’ll put out a new list of what is the responsibility of the seller and what are the buyers shortly.

Here is a look at what has been going on in Naperville over the past month. Instead of trying to take a look at a specific month, like March, I figured the best thing to do in being current was to just post and the statistics in that post are a look at the past month from that date. Make sense?

That way we are staying as current as possible because let’s face it…if I’m posting at the end of April on March’s statistics then who cares? I like up to date when I’m gathering information and so from here on out my statistics will be based on the day of the post and not for a conventional month. I will be looking at the Detached Single Family and Attached Single Family.

I will be looking at ACTIVE, UNDER CONTRACT, EXPIRED, and SOLD. Combined with these statistics I will provide up to date Absorption Rates. On top, I will be sharing anything that I feel is worth sharing. As always if you would like a specific neighborhood talked about or would like me to provide specific statistics just let me know. I’m always happy to help. Here we go:

Naperville Detached Single Family Homes

• Under Contract: Naperville saw 158 units go under contract in the past month. The average market time for these was 166 days. The median list price. The average sales price. Looks like the price range with the most under contract was within 30 units and 120 days on market. The longest market time is the price range at 397 days on market.
• Active Listings: In Naperville, we have 1,076 properties for sale with an average market time of 195 days. The median list price while the average price. The highest property for sale currently in Naperville is listed. Surprisingly the price range with the most current listings in the range with 165 properties for sale.
• Wow. That’s a lot of million-dollar properties for sale. Not to mention the 21 other properties listed. Market time for properties under seems to be pretty consistent at roughly 130 days.
• Expired Listings: In a “hot” market this is something I wouldn’t normally talk about because the numbers would be so small. But with today’s market here in Naperville I figured it is a great way to show what is going on out there. Over the past month, Naperville saw 41 properties expire off the market. Average market time at 286 days.
• Sold Properties: This one just blew my mind. In Naperville, a city of close residents, there were only 6 closings in that past month for single-family homes. I triple checked to make sure I wasn’t mistaken and it is true. The past two months saw something in the neighborhood of 50 properties but that the past month was only 6. I was shocked by this number.
• The average market time was really good at 95 days for those 6 units. Median sale price. I anticipate these numbers to increase significantly in the next month based on what I’m seeing out there today.

• Current Absorption Rate for Naperville Detached Single Family Homes is 6.81 months.

Naperville Attached Single Family Homes

• Under Contract: Currently 76 properties under contract in Naperville. The average market time is 138 days. Median List Price with an Average List Price range has the most under contract with 23. The highest attached single-family home went under contract listed.
• Active Listings: There are 508 attached single-family homes currently available in Naperville. The most popular price range with 150 on the market. The average market time for all attached properties is 149 days with a Median List Price and an Average List Price. The highest-priced attached single-family currently available in Naperville is on market for Any takers?
• Expired Listings: 16 units expired over the past month in Naperville. The average market time for those 16 units was 225 days. Median List Price.
• Sold Properties: Like the Detached Single Family I’m a bit surprised at the numbers for the Attached Single Family that has sold. Only 8. Market time was 166 days average for those 8. Only two price ranges were even represented.
• Absorption Rate for Attached Single Family Homes in Naperville: 6.68 months