How to Get Your Home Ready to Sell

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Tips to Prepare Your House to Get Sold

Are you getting ready to sell your home? Home sale preparation is one of the most vital tasks when selling a home.

Homes are rarely ready to hit the market as is. Most of them need a slight (or major) makeover to attract potential buyers. 

There are certain tricks of the trade that real estate pros use in order to quickly sell a home at a desirable price. These tactics will cost money upfront but will ultimately help increase a seller’s overall profit.

The following tips range from low-cost updates to full-on renovations. Whether your budget is large or small, these strategies are sure to help raise your returns.

Although this advice is mainly geared toward homeowners, it can be used for other people as well (e.g., investors using a 1031 exchange to quickly sell an apartment building). 

Get Home Ready to Sell

Clean, Declutter, Depersonalize

Decluttering and depersonalizing your home can help potential buyers visualize themselves in the space. Remember, you are moving on and leaving this home behind. The goal now is to emotionally detach and present buyers with a blank slate. 

In addition to giving the place a good scrub, pack up personal belongings such as photographs, knickknacks, family heirlooms, and other decor. Basically, remove anything that will distract from the sale. 

Regarding items you no longer want to keep, consider selling or donating them to a local charity such as the Salvation Army or Goodwill.

All other items can be put in storage or tucked away in small boxes in your cabinets and closets. Although this may seem cumbersome, consider it a jumpstart on packing. 

Give it a Fresh Coat of Paint

Painting is one of the easiest and cheapest ways to increase the value of a home. At a 107% return on investment, repainting the interior walls has one of the highest values in terms of home improvements. 

When repainting a home, research common and popular colors. Keep in mind that this is not about your personal style but what potential buyers will like. The exterior should have a fresh coat of neutral paint, and the interior walls should be free of any chips or cracks. 

It’s best to stick to inoffensive colors such as off-white, eggshell, or “greige.” But not all colors work for all rooms. For smaller spaces, pastels and stark whites can make them seem larger.

For larger, potentially alienating rooms, darker, more intimate colors can help bring the room in.

Don’t forget the trim and other adornments. Painting the crown molding the same color as the walls can make a room feel bigger, and painting it a contrasting color can make it cozier. 

Stage The Home

Staging a home has been shown to increase the odds of selling it for a higher price. You do not necessarily need to stage every single room, but consider doing important areas such as the master bedroom and living room. 

You also do not need to remove all of the furniture in your home to stage it. Hyper-stylized items like a bright yellow couch or zebra rug can be distracting, though, so consider moving them into storage or at least out of sight.

Temporarily decorate the home with furniture and decor that’s ordinary yet in style. 

Make Renovations and Repairs

Depending on the condition of a property, the seller may need to make some repairs to sell the place. A leaky roof, some cracked tiles, or a faulty HVAC system could all make selling your house much harder. 

Other times, a room’s features may simply be outdated, and making renovations would help increase the home’s market value. Remodeling the kitchen is a common route many homeowners take because most buyers want a nice kitchen.

Installing stainless steel appliances, granite countertops, and new cabinets can transform the space into an inviting room for cooking and hosting. 

Financing renovations can seem tricky, but homeowners can use plenty of creative options to achieve their remodeling goals.

There are different lines of credit that owners can tap into, like credit cards and second mortgages, but make sure to pay attention to the interest rates.

If you don’t have the money to pay off the renovations immediately, then you will want a card or loan with a low rate. Otherwise, you could end up paying more on interest overall. 

If going through the process of making renovations isn’t for you, but you still want to give potential buyers the option to make updates, you could offer seller concessions in the form of credits toward renovations and repairs

Increase Your Curb Appeal 

First impressions matter. The outside of a property and the driveway are what buyers will immediately notice. In addition to painting the exterior of a home, redoing the landscaping and/or the driveway can help increase curb appeal.

If you’re dealing with a particularly run-down house or a fixer-upper, then decluttering the front yard and mowing the lawn could do wonders for your selling efforts. Power cleaning a driveway or installing a new one can make a huge difference as well. 

Do a Photoshoot 

Once you’re done preparing the home, make sure your listing properly showcases the property. It would be a shame to put in tons of effort only to have a property sit on the market due to unflattering or bland pictures.

Listings with professional photos have even been shown to sell homes up to 32% faster than homes with low-quality images. 

When preparing your home for sale, it’s all about emphasizing the details that will capture a buyer’s attention.

Going the extra mile will show people you are serious about selling and will likely increase the final sale price. If you’re working with a real estate agent, be sure to ask for their advice on staging and renovations.

They should be able to point you in the right direction and offer references for contractors, photographers, landscapers, and more.

Final Thoughts

Hopefully, you have enjoyed these tips on how to get your home ready to sell and can put them to good use.

The more you can do to get your home prepared for the real estate market, the greater the odds you will sell your house fast for the most money possible.

Never sell yourself short by putting your house up for sale before you’re ready.

7 Optimal Tips to Update Your Front Yard

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How to Update Your Front Yard

When it comes to remodeling a home, generally speaking, homeowners tend to prioritize the home’s interior. The exterior is often an afterthought; however, it is an excellent way to update your front yard. However, the exterior is the first thing that visitors see when they drive up to the home.

When a home has an updated exterior, it tends to improve the curb appeal of the home. Whether you decide to sell the home or just improve it to maintain it, there are some tips to help to update your front yard.

These are the kind of improvements that will help your home sell faster.

Maintain the Lawn

As we are well into the spring season, it is a good idea to reseed the lawn. Fertilize and ensure that your lawn is taken care of. Weeds are inevitable in most lawns.

Ideally, pull weeds, including the roots by hand, or use a hoe to remove the entire weed.  If the weeds are overgrowing and out of control, you can use an herbicide to kill the weeds. Be sure to read the directions to ensure you don’t damage the existing lawn.

You can also hire a service to take care of your lawn monthly to ensure that it is weed-free and green. There are some late spring tips to take care of your lawn and yard. Hire a landscaper or gardener to help mow the lawn weekly. A green and healthy lawn is very inviting and will make the home and yard look well tended to.

If you have a smaller area where you want to have a lawn and are not interested in the maintenance, consider adding artificial turf. This is a great way to maintain a green appearance.

It is a good idea to research what type of turf, and remember some of it does get hot. This can be problematic if you have pets.

Tend to the Flower Beds

Shrubs and bushes in flower beds should be trimmed neatly to create a neat appearance. If you want to put down mulch around the shrubs, that creates a nice look.

Remember to get the flower beds free of weeds as well. If you have smaller flower beds and want to add annual color, that will add some zest to the home.

Consider adding petunias or marigolds will add some bold color. You can keep them for several months by pruning back on the old blooms.

Flower beds that are neat and orderly definitely create an attractive yard and another way to update your front yard. These landscaping improvements will help to improve the overall home value.

Paint Your Front Door For More Exterior Appeal

After you have cleaned up the front of your home to ensure no cobwebs or leaves are hanging around, consider painting the front door and trim.

It can be a contrasting color to the home, which will add to the appeal of the exterior. Avoid any home improvements that may be too trendy, as they can be a turn-off for a potential buyer.

If you are selling your home, select a color appealing to the majority, as you don’t want the color to be too off-putting. Consider adding a seasonal wreath on the front door and a fresh entryway doormat.

All of these enhancements you are making to your home are considered exterior staging.

Update Your Exterior Light Fixtures

If your light fixtures are in good shape, then go ahead and just be sure to clean them and ensure the light bulbs are operable.

Light fixtures are considered fixtures in real estate as they are attached to the property.  If the light fixture is in disrepair, consider replacing them. Light fixtures are not all that expensive and consider a search at a home improvement store such as Ace Hardware or Lowes.

All of these steps will help you get the home ready for a spring sale should you decide that is the direction you plan to go.

Add an Architectural Mailbox to Help Update Your Front Yard

If you live in a home in an HOA, there may be restrictions on what type of mailbox you can put on the property. If not, some beautiful mailboxes can be added to the property and make the exterior and front yard more appealing.

There are many different mailboxes that you can select. Consider searching online for the type of mailbox you are seeking. There are mailboxes with a post or wall mount that you can select.

Many companies offer an option with the selection of the finish, including an architectural bronze finish. Keep in mind, if you live on the waterfront or ocean that is a more corrosive environment. This can impact the mailbox and cause it to corrode more quickly. Be sure to select a finish that will stand up to the elements.

Update Your House Numbers

Along with your upgraded mailbox, you can also upgrade the house numbers. There are many places where you can order house numbers to add to the appeal of the exterior of the home.

With a farmhouse-style home, many are using house numbers in script style with the house number, and some are even adding the name of the street.

Be sure to order house numbers that will tolerate the elements. The last thing you want is to purchase house numbers only to have them rusting or falling apart within the first few months of having them.

Add Exterior Lighting

There are some fabulous options to add exterior lighting to your flower beds and yard. If you have a beautiful tree as a focal point, then you may want to illuminate the tree. Add lighting in the flowerbeds to showcase the flowerbeds and seasonal flowers.

There are many options with exterior lighting, including solar, which is a great option. They are not difficult to install, and the wires are buried under the soil, which can be a relatively easy DIY project.

Get a timer for the lights and allow them to go on at sunset and stay on until dusk. Not only are the exterior lights aesthetically pleasing, but they also add to the safety of your home. The exterior lighting is a money-saving home improvement tip.

Final Thoughts

There are some fabulous ways to transform your home’s exterior by following the steps above. Be sure to maintain your home to prevent your home from accruing deferred maintenance.

Updating the exterior of the home will create a lasting impression of your home for visitors and buyers if you are selling.  There are many other ways to create a beautiful curb appeal of your home, so be creative and add to the value of your home.

Hopefully, you have found my tips for updating your yard to be useful.

The Quick Little Guide on the Fastest Way to Sell a House

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A Quick Little Guide on the Fastest Way to Sell a House

Do you need to sell a home fast? If this is your first time selling a house, you may realize that there are different challenges that are waiting for you.

For some people, there is a tendency to feel emotional during the process. This is somewhat normal especially when you lived in that house for a long time.

The memory in the place sometimes makes people question their decisions. But you should not let your emotions cloud your judgment because it may make you commit some mistakes in the process of selling.

Selling a house fast may seem to be a complex process for first-time sellers. This is because there are some parts of the process that you’re not familiar with. For other people, they struggle in the process of showing the house to potential buyers.

You will hear how people will critic and comment about the specific parts of your house. This may also affect you in some ways emotionally.

So before selling your home, you should familiarize yourself with the important things you need to remember.

Sell House Fast

Understanding the Mechanics of Home Selling

Putting your house in the market requires you to know the mechanics of selling a house. A lot of people commit mistakes and end up waiting for a long time for the property to be sold.

Prices, insurance, real estate agents, and other factors are determinants of the success of your journey as a selling.

Understanding how these factors can affect the whole process will give you enough idea on how to strategize.

So, before you even decide on prices and other stuff, learn about the mechanics of home selling. Know the simple steps and the common mistakes people commit.

Avoid these Mistakes when Selling Your Home

Here are the different mistakes you should avoid to make sure that you will be able to sell your house faster.

Getting Emotional

This is the most common mistake that people who lived in the house for a long time commit.

People usually get emotional in the process of selling a house because of many factors. But this is something that can get in the way of being able to sell it. There are some people who suddenly feel like they are no longer sure if they really want to sell the property.

So before you sell, you have to make sure that you are emotionally ready.

Setting an Unrealistic Price

Another reason why it is usually taking too long before a property is sold is the unrealistic price being set by the seller. To avoid this, you have to check the market and determine the real market value of your property.

You need to pay particular attention to the right real estate comparables. In other words, the homes that are truly similar to yours. Analyzing comps correctly is one of the key ways to ensure your home is priced appropriately from day one.

There are some homes that make really good comps and others that do not. You can also ask the help of real estate experts for this.

Also, keep in mind your home is going to need to pass the buyer’s lender’s real estate appraisal.

Not Carrying Proper Insurance

Most people as mentioned by cash for homes are looking for properties that are insured. One of the common mistakes that sellers make is not having the insurance details while selling.

Buyers also make their own research before buying a house. They know the importance of getting a property that is insured.

Few Simple Steps on How to Sell Your House

To assist you, here are some steps you can take to ensure that you will be successful in selling your house.

Sell Your House to a Wholesaler

A wholesaler is someone who sells houses for the seller at a higher price and gets the difference as his or her part.

There are different reasons why you should get a wholesaler. Firstly, they have quite a great number of prospects and potential buyers. Aside from that, they also ensure that your property will be sold at your asking price.

Find the Right Real Estate Agent

There are several things you should consider when you are looking for a real estate agent.

You have to check their track record and see how they are performing But most importantly, you have to ensure that they are familiar with the neighborhood where your house is located.

Interviewing real estate agents before choosing is one of the best ways for you to be able to get the best one.

Declutter Your Home

This is an important reminder before you even decide to sell your house. Make sure that it is ready to be photographed and featured in the market. Real Estate agents refer to this as staging the home properly. Staging can be everything from removing unwanted items to making repairs, to changing up the furniture, to changing paint colors.

Some folks have so much stuff they need to rent either a self-storage unit or a Pod in order to get their extraneous stuff out of their home.

You can start by eliminating things that are not necessarily important in the selling process.

Consider a Short Sale of Your Home

This option is for homeowners who still have an amount due on their mortgage. If you are financially distressed, the best way for you to be able to successfully get a buyer is to short sale your home.

Many buyers are looking for houses in short shale because of the reduction in the price.

Check Your Curb Appeal

One of the things that people check, whenever they are buying a house, is the external appearance. You have to check if your walkways, yard, lawn, and even driveway look good online and personal. The house should be inviting and appealing.

When it comes to the exterior there are fewer things more important than your home’s curb appeal.

Keep Up with Current Technology

Now that technology has already changed the way people live, buyers are also looking for the newest tech upgrade in houses they visit.

Start with your security features and look for the best gadgets that can ensure this. From securing your front door to some auto blinds, you are certainly putting your house on top of the others in the market.

Write a Great Listing Description

Listing is something that people check. Make sure that your description will make potential buyers interested in visiting your house.

A great listing description is short and catchy. It should contain the most important details buyers should know about your house.

Bottom Line

Selling your house successfully can be achieved with the proper strategy. As the homeowner, you know exactly what should be changed and what to improve in your home.

In taking photographs, be honest and yet be challenged by the fact that there are other houses being sold in the market.

DIY Home Staging Tips – Stand Out From The Competition

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How to Stage Your Home Yourself

Do you need to get your home looking better? Are you looking for some DIY home staging tips that will help make your home stand out from the competition?

Do-It-Yourself (DIY) home staging is the skill of transforming your home into a product that will be generally pleasing to most onlookers.

While there are many reasons for staging a home, the most popular would be when a home is up for sale. It is about optimizing the layout and space of your home in a manner that highlights its best peculiarities making it stand out from other houses in the market.

This art is becoming quite popular owing to the results it brings to homeowners. In this DIY home staging tips article, we will focus on the major components of a typical home.

DIY Home Staging

Clean and Repair to Start The Home Staging Process

Clean and repair are the rule of the thumb when it comes to DIY home staging. For any room, this can be one of the largest hindrances for home clients. Having a clean home that is free of major repairs makes your home seem move-in ready, so potential clients are not coming up with the list of stuff requiring extra work on their part.

Before you start adding decor pieces, try to get your house in top shape. Fix anything that is broken and work on decluttering the various parts of your home. It would be highly advisable first to get rid of anything you no longer need or want.

One of the better avenues to take would be to hire one of the top junk removal companies such as 1800 GOT JUNK or another refuse removal company like them. They will come to your home with a truck and take away what you don’t want.

If some of your things have value they will donate the items to charity for you – a nice bonus to be able to help someone out in need. Once you have the larger items out of the way, you’ll want to start organizing what remains.

This means removing unnecessary items from cabinets and closets to show that the home has plenty of storage area. Also, remove clutter from the garage, attic, and basement so that the floors are easily visible and people can start to imagine their furniture and belongings in the area.

After cleaning, repairing, and removing the unused items out of the way you can shift your focus to staging each room in the house to appeal to a wide range of buyers.

Even homes that are in bad condition can benefit from home staging. Even properties that need some TLC show much better when they are not filled and unorganized with junk.

Kitchen Home Staging tips

Certainly, this is one of the places in your home that needs to be staged exceptionally well since it will help you sell. Normally, homeowners are seeking stylish and refreshed kitchens, thus, you need to learn what is trending.

First and foremost, make sure the kitchen is sparkling clean. Declutter the countertops, clean the floors, and make all the appliances as clean and sparkly as possible.

As you might expect, it is the tiny details that make a lot of difference in home staging.

For instance, fresh fruit and flower bowls can produce a little life in your kitchen. You can enhance it with a few excellent stemwares that are set out to encourage visitors to think of entertaining in the place.

In case you own a breakfast bar, position the stools nearby but with a bit of space between the stools and bar to give the image that the bar is spacious.

Make sure all the lights are on and if there are windows, allow as much natural light as possible by opening curtains and blinds.

Living Room Home Staging Tips

When preparing the living room for potential buyers, your aim should be to make it appear big and spacious with a lot of possibilities.

This is essential because oftentimes, this is the area that a majority of homeowners gather and entertain. Make this area simple and eliminate any unnecessary and bigger decoration items.

Accentuate the windows and natural light by pulling back drapes or curtains and opening up the blinds and shades.

Luckily, the living room is the simplest place to include modern trends too, without necessarily going overboard. Although going out to purchase all brand-new decor accessories is not a must, it is a good idea to have trendy accessories that stand out.

Bright, dissimilar palettes are not just in fashion but can be a tool to attract attention to particular traits of the home that you wish to show off.

Bathroom House Staging Tips

The bathroom is another area that can impact a home for sale. Usually, potential buyers will look for a comfortable and ultra-modern bathroom that makes them feel relaxed.

Replacing old light fixtures with modern items is an inexpensive way to lighten the area and add modern touches. If you have the budget, you may consider replacing colored tile with more neutral-toned tile.

The idea is to show your potential buyer the inherent feasibility of your bathroom.

Normally, it is good to add nice items such as candles, towels, decorative soaps, small plants, and other common items found in your bathroom.

Although you don’t spend a lot on DIY home staging, replacing things like bath mats and towels can indeed bring some desirable impacts.

Additionally, a bathroom is a place you should spend extra time cleaning, eliminating any build-up or mildew from the moisture. This can be an immense hindrance for buyers and may even be a reason your home will not sell.

Bedroom Staging Tips

While you want the bedroom to be inviting, you also want it to be neutral enough that a potential buyer can envision living in that room.

You will need to eliminate anything that is messing up your bedroom, as well as photos and personal items. This can mislead the buyer from noticing other appealing qualities of the home.

Have suitable and neutral colors on the bedding as well as a limited number of throw pillows. Be sure the bedroom is sufficiently lit before showing, either with natural light that comes from the windows or decorative light installations.

Home Staging Tips For Your Entrance

The front entrance to the home is what people will see when looking at pics online and determining if they even want to visit your home.

Clean the door and any windows around the entrance. Remove any clutter from the front porch or steps. Add some color by placing a seasonal plant near the door.

If the house number is on the door, or near the door, either clean it diligently or replace it with new numbers.

All of these items can draw more eyes to your listing and help you to sell quicker.

Final Thoughts On DIY Home Staging Tips

You don’t have to follow any complex rules with these DIY home staging tips. Focusing on little details always makes your home stand out. Making some repairs and cleaning is a simple but excellent step to consider to render your home even more attractive to potential buyers.

By doing so you will also increase the chances that when the appraiser visits your home will look even more favorable.

Even More Home Staging Resources:
Staging your home may seem like a waste of time and money but the reality is that in most cases, staging a home can be very beneficial to a home seller. Take a look at this post by Sharon Paxson to learn about how to stage a home and why it’s so important!

Virtual Staging Versus Home Staging: Which Is Better? If you don’t know what virtual staging is, to put it simply, you’re staging your home for the web but not for the in-person visit. Does that matter? It depends and I would encourage you to read this insightful article about virtual staging by Conor MacEvilly.

If you don’t “wow” potential home buyers with a great first impression, there’s a good chance you will not get top dollar for your home. Staging your home is an art and if it is not taken seriously, your home could look downright UGLY. Michelle Gibson goes through home staging mistakes that must be avoided if you want to create a lasting first impression.

Use all of these additional home staging articles to make your home look like a showplace. If you have the time to put it in, DIY home staging can save you lots of money and get your place looking as good as a pro. Best of luck!

 

What to Expect From a Real Estate Appraisal

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What to Know About The Real Estate Appraisal Process

Finally, someone has come along and given you the offer you’ve been waiting months for. But the stress isn’t over yet. Your home is now about to go through the potential buyers’ house appraisal process.

There are many factors that will determine the appraisal value. It is helpful to these things whether you are a buyer or a seller.

House appraisal issues can cause massive delays when trying to sell a home. They are the 2nd most common issue related to contract delays, only behind problems related to the buyer getting their mortgage commitment from a lender.

Even worse is that appraisal problems are the cause of around 1 in 10 contract terminations. So there is a good reason as to why you might be nervous about this whole thing in the first place.

Let’s talk about everything to do with appraisals so you can better prepare yourself for the inevitable future of having a real estate appraisal. By the time you’re done reading, you’ll know exactly what to expect.

At What Stage Can You Expect The Home Appraisal to Occur?

Appraisals happen just after the seller, and the buyer agree on details like prices and repair costs. The buyer’s borrower will issue an appraiser to gauge the home’s value to ensure the lender is loaning money on a property worth the money being spent.

Some sellers also like to get a pre-appraisal done on their home if they have no idea what it should be priced at. Sometimes there are homes with limited comparable sales or “comps,” making it difficult for real estate agents to put a correct asking price. Having an appraiser in will give you at least another opinion of value.

What to Expect From a Real Estate Appraisal

Who is charged for the home appraisal?

If a loan is involved, the buyer nor the seller can request a home appraisal from a company. Instead, this is sorted out by the lender, who will go to a third-party AMC.

In this case, it’s the buyers who are billed for the home appraisal assessment, and the lender determines the fee. However, the appraisal company is charging the lender and setting the fee, which is in turn passed along to the buyer in the form of part of their closing costs.

Generally, this can be anywhere from $400 to $1000, depending on the lender the buyer has chosen and depending on who the lender chooses to appraise the home. You can learn more about the cost of a home appraisal at Benzinga.

What is The Actual Purpose of an Appraisal?

The point of an appraisal is to determine the market value of a home, protecting the buyer from overpaying for a home that could put themselves in financial jeopardy. As mentioned, to also help the lender find out how much they should be lending.

The way the appraiser does this is by assessing the property to gauge the value, noting things like its features, the size of the home, and its overall condition. A real estate contract will often include a clause that says the sale is contingent on the house appraising for the agreed-upon price or higher. This is a common real estate contingency and not out of the ordinary.

However, in the hot seller’s real estate markets, many contingencies are often waived by home buyers to sweeten their offer. More often than not, this will happen when there are multiple offers on a property.

How to Prepare For a Home Appraisal

The appraiser is there to do the best job they can, but are there ways you can be better prepared for the whole process to ensure your home gets the value it’s deserved?

Well, yes, there are things you can do to ensure that the home gets the right appraisal price:

Clean Your Home

The same way you cleaned your home when you had buyers viewing the property, do this exact thing again as if you’re showing a new buyer around the home. The principal is essentially the same because you want to make a good impression on the person walking around, though this time, it’s an appraiser.

Make Sure Your Pets Are Secured

Don’t get us wrong, who wouldn’t want to be greeted by a loveable dog as soon as they walk into the home? It almost gives a nice impression that the place is a loving home. But there is nothing worse for an appraiser who is trying to do their job when they’ve got a pet following them around wanting some love.

So make sure to secure your dogs and cats away!

Clean Up The Front and Back Yard

Just like you’ve done with the interior of your home, you’re going to want to give some love to the exterior, which means pulling out any weeds, mowing the lawn, and trimming the hedges. Generally, just making this as presentable as you possibly can to ensure that you’re giving off the right impression when the appraiser comes round to do their job.

If your home looks like it has no pride of ownership, it could influence the appraiser. Keep in mind that an appraisal is just one person’s opinion.

You could have ten different appraisers visit your home, and the likelihood is having ten different values. It is no different than a real estate agent giving you an opinion of value.

Leaving the home in bad condition will be a mistake.

What Do Appraisers Lookout For in a Home

Almost all appraisers will use the same form when looking around a home, the URA Report.

This form asks questions about the housing trends, neighborhood demographics in the surrounding area, available utilities, and the property’s exact measurements.

Exterior Factors

Throughout the exterior, home appraisers are taken note of the following things:

  • Age
  • Structure
  • Construction quality
  • Property site
  • Location
  • Roof integrity
  • Foundation Integrity
  • Parking
  • Gutters and siding
  • Neighborhood
  • Exterior condition

Interior Factors

Throughout the interior of the home, appraisers search for:

  • Functional layout
  • Square footage
  • Number and size of bathrooms, and kitchens, bedrooms
  • Health and safety accouterments
  • Included utilities
  • Code compliance
  • Appliances
  • Interior condition
  • Structural integrity

Upon checking these things, they intend to see how the property matches other similar properties in the neighborhood. The appraiser will take measurements and photos, which will allow them to get the full picture and finally assign a value to the home.

This is why it is so important to do a spring clean of the home, as if the appraisers deem things to be untidy and unkempt, they’ll have a reason to think that the house itself has not had proper care shown to it, which could influence their opinion of the home and ultimately the value.

It should be noted that appraisers are not doing a home inspection as a professional home inspector does but they do look over the property for substantial issues.

When Will You Get The Results of a Home Appraisal?

The appraisal report could take around a week to get back to you, but it’s more realistic that you’ll be waiting a little longer than that, around about 10 to 14 days.

This is because the appraiser may have to call around, check for permits and verify certain information for their report. If you want things to be as speedy as possible, make sure your agent is communicating well with the appraiser so that they can answer any of the questions they might have about the property.

Final Thoughts on Home Appraisals

You should now have a better understanding of the house appraisal process. Without a doubt, the appraisal is a vital hurdle to clear in a real estate transaction. Doing what you can to help the process along is always a good thing.

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How to Sell a House in Bad Condition

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Tips For Selling a Home in Terrible Condition

Are you looking to sell a house in bad condition? The sad reality of life is that homes can fall into a state of disrepair or even worse, become uninhabitable. This happens for a number of reasons, including unfortunate circumstances like health problems, job loss, natural disasters, or a combination of all of these.

When people find themselves in this situation, selling their home is often the best option to getting out from under their financial stress. Unfortunately, this can leave them vulnerable to those looking to take advantage of their situation, or just making a bad decision.

If you find yourself in this situation and are confused about what your options are for selling the property and getting as much money out of the deal as possible, you do have options, you just need to take a little time to understand what they are.

Selling a House in Bad ConditionDistressed or Uninhabitable Properties

Let’s start with the worst-case scenario, the uninhabitable home. These are homes that are unsafe to live in and in many cases, these properties could be on their way to being condemned. Condemnation happens when the local government entity responsible for housing code violations deems the property is unsafe to live in.

Once a home is condemned, no one is able to live in the property including the owner, until the appropriate repairs have been made. When it comes to selling a house in bad condition these are typically the worst of the worst.

Some of the things that make the home uninhabitable include, major problems often caused as the result of years of deferred maintenance and neglected repairs. Natural disasters like fire, floods, tornados, and hurricanes can also contribute to creating an inhabitable property.

In many cases, homeowner’s insurance can help cover the costs of making things right after a natural disaster but it won’t help with man-made issues like neglect, methamphetamine production, or mold from marijuana grow houses.

These homes can also see structural issues like cracked, heaving, or moving foundations. In cases like this, insurance will not cover damages related to structural issues unless they are directly related to a natural disaster that is specifically covered in the policy.

Roof damage is another problem, damaged, leaky roofs can be expensive to repair and allow water into the property which can start the production of things like black mold.

Non-functioning systems like electrical, HVAC, and plumbing can also make a home inhabitable. These systems are expensive to repair and are not covered by insurance.

Black mold is a toxic mold that causes serious health issues when found in high concentrations. You cannot live in a house with black mold because it leads to allergic reactions resulting in vomiting, bleeding nose, and lungs. This is why houses with black mold are considered unlivable. You need to understand your responsibilities if you are going to sell a home with black mold.

Lead-Based Paint was used in homes built before 1978. If left undisturbed, lead-based paint poses a minimum risk, but if it is sanded or chipped, inhaled, or ingested it can lead to brain damage, damage of vital organs, seizures, death, and even behavioral issues.

While lead-based paint in and of itself is not a big deal if the home is distressed and requires repairs and renovations, the presence of lead-based paint can make matters worse.

Asbestos much like lead-based paint can be hazardous, especially if the fibers are inhaled. If the asbestos fibers become airborne or have the potential to become airborne, they are a problem. Like lead-based paint, asbestos in an undisturbed state isn’t very problematic, it can become a huge obstacle when it comes to renovations to the home. Mitigation must follow strict standards, and this process is expensive.

Termite infestation can lead to foundation problems, doors and windows that won’t close, and other major issues, especially if repairs are not done quickly. Damages caused by termites can be costly but should receive immediate attention.

If you do not do the repairs, the damages can be severe. Selling a home with a termite infestation comes with certain requirements, especially if the buyer is using an FHA loan. The FHA has stringent guidelines around termite inspection requirements for existing homes.

Serious Chimney Issues, serious chimney issues include creosote, obstructions, damaged crowns, cracks in the flue, and brickwork issues. If this is the case with your chimney, living in the property can be dangerous both from the standpoint of the inside air you breathe and the risk of sections of the chimney falling through the roof.

There are a ton of potential problems that can lead to a home becoming uninhabitable, these are just the most common.

The primary objective should be to determine if the home is uninhabitable or simply in poor condition. A home that is simply in poor condition will have a lot more options when it comes to selling.

Properties in Poor Condition

In many cases, there is a fine line between an uninhabitable property and a home that is simply in poor condition. The primary factor that differentiates these two types of properties is the soundness of the structure.

You can think of the poor condition home as the final stage before uninhabitable. problems left unaddressed only get worse leading to further deterioration and ultimately major problems.

Issues found at the poor condition-stage are serious but don’t make the home uninhabitable. Therefore, you may live in such a house, but it is certainly not pleasant or necessarily safe.

Some of the issues associated with this house include damaged floors, failing HVAC, foundation issues, Ice dams, serious plumbing issues, minor electrical issues, rotting wood, damaged and outdated kitchen or bathrooms, and damaged and/or non-functioning faucets / light fixtures.

Properties With Deferred Maintenance

A house at this level is livable since the issues associated with it are minimal. For you to sell a house with deferred maintenance, some repairs are required. Also, these houses have no health or safety issues.

Some of the deferred maintenance cases include; dated kitchen, peeling paint, dirty cluttered interior and thick hoarder, dated bathrooms, outdated finishes on faucets & light fixtures, dirty walls, dead overgrow untended landscaping, dirty, stained flooring, and weathered exterior.

How To Sell a Distressed or Uninhabitable Property

No matter how bad the condition of the home, the first option should be to see if you can make the property right by doing any needed repairs. Easy enough to say but that option costs time and money, both of which are usually in short supply in these scenarios.

Your first move should be to figure out what the numbers look like. Is there enough equity in the home to cover the cost of repairs plus additional profit for you after the sale? Or, is the cost of repairs greater than the potential sale price of the property?

If the cost of repairs and renovations exceeds the realistic sales price of the property, your options are clearer but limited. In this scenario, you’re going to be looking at what is called a “Distressed Sale”.

In a distressed sale scenario, you will most likely be looking to work with investors; investors should be willing to pay cash for your home in its current condition. This allows you to sell the house without having to deal with the property condition requirements associated with a sale involving a traditional mortgage.

The primary concern at this point becomes your existing mortgage. If you have a loan on the home and the investor cash offer is less than what you owe on your mortgage, you’re still responsible for the remaining balance. Not fulfilling this obligation could result in the lender pursuing a foreclosure.

Distressed Sale Options

When a house is considered uninhabitable or in poor condition, very few retail buyers will even look at the home, so you will be looking for investor buyers.

A retail homebuyer is someone that is buying a home they will actually occupy. We work with a lot of retail home buyers that are looking for Homes for sale in Colorado Springs. These are the type of buyers that make up most of the home buying market.

Retail buyers will generally be using financing to make the home purchase. 94% of all home purchases in 2020 used one of the three basic mortgage programs, Conventional, FHA, or VA loans.

Each of these loan types has minimum condition standards about the type of property they are willing to lend money on. In most cases, a home in uninhabitable or poor condition won’t meet those standards, unless the buyer uses one of the several special FHA 203K or Conventional rehab loans available to consumers.

Most retail buyers are looking for a home, not a project, so the pool of potential retail buyers for distressed properties is very shallow.

This means owners of Uninhabitable and Poor Condition Properties are looking primarily to investors to purchase their properties.

Investors will often purchase with cash, eliminating the FHA, VA obstacles. The investor buyer will be looking for a deep discount and if there is enough equity in the property, you may be able to work with this type of buyer.

Wholesalers:

The first type of investor client we will look at is the Wholesaler. These are the investors who put out the “bandit signs” around town advertising to “Buy Your Home For Cash”.

While this may feel a little sketchy, depending on your situation, it might be a good alternative. Selling a home for cash to an investor is actually quite commonplace when selling a home in bad condition.

Certainly worth talking to them, just remember, they are looking to make money off of your hardship. Get a number from them but don’t agree to anything until you do more research. This will most likely end up being your “worst-case scenario”.

iBuyers:

This should be the next option you look into. iBuyers are institutional buyers. They are essentially the wholesalers just online and without the bandit signs. These are companies like Zillow instant offers, Opendoor, and a multitude of new players.

iBuyers will make a preliminary cash offer but follow up with a property inspection. It’s important to note that after the inspection, the number they are willing to offer you may change based on the cost of repairs.

Traditional Sales Route:

Taking the traditional sales route can also be a good idea. Work with a Realtor, establish an attractive price by looking at the comparable sales or “comps”, and list the home for sale in the MLS.

In many cases, you can find a buyer that is willing to purchase with either cash or by using one of the many rehabilitation loans available to qualified buyers with good credit. This route will most likely take longer but at the end of the day could potentially net you more at the end of the deal.

Depending on the type of market you are in buyers may actually bid up the price of your uninhabitable listing. In strong seller’s markets, buyers jump on discounted properties.

Many times the thought of a deal will motivate hungry buyers to overpay in an effort to win the deal. While this is not necessarily a strategy you should count on, it is nice when it happens.

Selling a Home With Deferred Maintenance

A home with deferred maintenance is potentially a much easier sale to make than a distressed property.

Much of the work required by this type of property can be completed by the homeowners themselves. If there are problems, there are usually less extreme than those found in a distressed home.

The best option for a home with deferred maintenance issues is to try and bring the house back into good condition so that it can be sold. This means lots of cleaning and decluttering.

Once the home it’s presentable, you should get a pre-listing property inspection. The inspection will reveal what potential problems a buyer will ultimately end up discovering when they do their inspection.

Once you discover the big items that need to be repaired you’re going to need to figure out a way to pay for them. There are a couple of simple options available.

Traditional Home Improvement Loans and Lines of Credit

Home improvement loans

One option for financing a renovation is through a home improvement loan. These are personal loans that are unsecured and are offered by most banks.

Interest rates for these loans are based solely on credit score and the funds are available almost immediately, once you are approved. These loans also allow for shorter repayment timelines.

The only drawback to home improvement loans is that they come with higher interest rates when compared to home equity loans and home equity lines of credit (HELOCs).

Home Equity Line of Credit (HELOC)

If there is enough equity available in your home, you can obtain a home equity line of credit. A home equity line of credit is a line of credit that is secured by the existing equity in your home. This is a revolving line of credit you can use to make home repairs and improvements.

The HELOC is usually a lower interest rate than some other common types of loans, and the interest may be tax-deductible.

Rehabilitation and Remodeling Loans

Most of the financing options available for rehabilitation & remodeling are geared towards home buyers, not sellers.

For example, the FHA 203K program is a great program, but it requires the borrower to occupy the property after the repairs and renovations are complete.

If you are planning on staying in your property for a while after fixing it up, this type of loan might work but talk to your lender about your plans, you don’t want to deal with the problems that arise from using this loan incorrectly.

Fannie Mae HomeStyle® Renovation

The Fannie Mae HomeStyle® Renovation is a loan product that combines a home refinance with home improvement financing all in one loan with one closing. This is a conventional loan program that boasts rates as low as a HELOC.

The occupancy requirements on this loan make it a better choice for someone looking to fix up their home in order to sell. Because this is not an FHA product, the qualification requirements are more stringent but if you qualify, this is a great way to get your home back to beautiful.

Sell in “As is” condition

If your situation prevents you from pursuing any of the fix-the-house-up options, you might consider an “As-Is” sale. In this scenario, you would list the property for sale at a bargain sale price. It’s important that you disclose what you know about the property, but stipulate that you have no intentions of making any repairs.

If the price is attractive enough, it could attract buyers that are willing to do the required work in order to get the deal. In some cases, the buyers may even bid the price up. Do your homework before attempting an as-is sale, there are a number of best practices you should follow.

It’s important to remember your commitment to your mortgage holder, in other words, you can’t sell the property for less than you owe on the mortgage. Since this type of situation doesn’t meet the requirements to do a “Short Sale”, you will need to be aware of what your numbers are.

If you sell for less than you owe the mortgagor, you are still responsible for the balance. Failing to pay this off could result in a foreclosure, and this can just prolong your misery.

In Conclusion

Selling a home in bad condition is clearly not easy, but there are options available. From wholesalers that post bandit signs on the side of the road to HELOCs, and conventional rehabilitation loans. Simply walking away from the property should be your very last option.

It is also important to seek the advice of real estate professionals, from mortgage lenders, and bankers, to Realtors. You never know where your solution is going to come from, the more options you look at, the more likely you are to come out ahead.

Hopefully, you have found this information on selling a house in bad condition to be useful.

What Makes A Good “Comp” or Comparable When Pricing Your Home?

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Tips For Selecting Comparable Sales When Selling a Home

When I sit down and talk to a home seller about listing their home the first question most home seller wants to know, is…. what can I sell their home for….

Often followed up with my neighbor sold his for $800,000, and as I look at the neighbor’s house is towering over theirs with brand new siding, a new roof being three times the size of their home.

Unfortunately, the neighbor’s home is not a good comparable property to indicate their home’s value.  While in the same neighborhood, it is important comparable properties have other features in common.

How to Select Comparable SalesDetermining Value

A real estate agent uses a Comparable Market Analysis or CMA to determine the value of a home.  A Comparable Market Analysis is a report that uses similar, recently sold homes to determine the subject home’s fair market value.

Similar homes are referred to as comparables or comps. Comps are often adjusted slightly for amenities a house may or may not have compared to the subject property, like a garage, central ac, sprinkler systems, etc.…

In many ways, a real estate agent will mirror what an appraiser will look at when evaluating a home.  An appraiser has some strict guidelines to follow, while an agent has a little more leeway when choosing comparable homes. In the end, the house must appraise, or there will be problems with a buyer financing a home.

The accuracy of the CMA relies on choosing good comparable homes.

What Makes A Good Comparable Home?

A home seller needs to know what makes a great comparable or comp for your home.  Plus, if you understand what makes a comp for your home, you can have an educated discussion with your REALTOR about why a particular house is a comp or isn’t a comp.

A comparable home is about similarity.

It would be awesome as real estate agents in an ideal world if we could find 3 identical homes in the same neighborhood on the same size and shape lot, all with a similar view.

But the reality is that doesn’t happen very often.

Factors To Consider When Selecting Comps

First and foremost we are looking for homes that have sold in the last 6 months and preferably the last three months.

And did I say sold?!  A seller can ask any price they want for a home, but it is not a comp until it sells.

So besides being recently sold, what are we looking for in a comp?

Location- Comparable sold homes should be in the same town as well as be in the same neighborhood or within 1 mile of the subject property.  If you have to go outside one mile, then you should use homes in similar communities.

Size-  When selecting comps, a comparable home should be similar in size to your home.  Ideally, no more than =/- 10-15% of your home size and certainly not more than 20%.  When we talk about square footage, we are also talking about above grade living area.  Finished basements, living space below grade is not included in a home’s square footage.

Condition- Condition can play a large role in what is a comp for your home and what is not.  A 1980’s colonial period with no work done to its can vs. a 1980’s colonial with extensive renovations can have a very different value.  Your comps need to be of similar condition.

Room Counts- Room counts not to be similar for a comp to be considered.  A ranch can have 6 or 7 rooms, but it is essential to pay attention to the bath count and bedroom count.  A 7 room ranch with one bath and 3 bedrooms is not a good comp for a 6 room ranch with 2.5 baths and 4 bedrooms.

Age- Homes that are compared should be of similar age.  A colonial built in the ’60s will have a very different appeal and function than a colonial built last year.

Style-  The style of the home needs to be factored in when selecting comps.  Try to compare ranches to ranches and split levels to split levels and capes to capes.  Each style comes with its own sets of benefits and downsides.

Amenities- Homes with garages, finished basement, central ac, sprinkler systems, etc.… should also have comps with similar amenities.

Adjusting Comps

Like I said earlier, there is the ideal world…. Which rarely exist.  Often a real estate agent will have to make adjustments to comps.   Maybe the adjustment might be a two-car garage versus a one-car garage, or a home has central ac, and one does not.

Or, on a higher level, a 2 bath home needs to be compared to a 1.5 bath home.

This is where it can start to get subjective.  But an experienced agent will have a handle on what a bath is worth and what one garage stall is worth.

But as a home seller, every time you go outside these guidelines or adjustments are made, there should be a clear explanation of why.  If adjustments for a home are going past 10% of a home’s price, you may need to find another comp.

Selecting comps can be as much of an art as science and cannot be as easy as it sounds on paper.

What Doesn’t Really Effect Your Homes Price

I have 3 acres of land…  A building lot is a building lot.  Of course, you wouldn’t compare a 5,000 square foot of land to 3 acres, but a one-acre lot will not have significantly less value than a three-acre lot.

I just spent $80k on a new deck…..  Ok, but that just is not normal for a $500,000 home.  Exessive, over the top renovations will not make your home worth more money.  An $8-12k deck would have been a more reasonable expense.

My swimming pool was over $100k…. Depending on where you are in the country swimming pool may have more value.  But here in New England, pools will only net you pennies on the dollars spent.  In general, you will just have spent a 100k on a big hole in the ground many buyers will want to fill.

I spent a bundle soundproofing my basement family room….  Ok, dude, that is just plain creepy!  But besides being creepy, highly personalized renovations aren’t going to make your home worth more money. (and yes, I’ve heard this one)

I have a new roof and a new furnace….  A home is expected to have a roof that doesn’t leak and a furnace that fires when you turn the thermostat on.  You will not recapture the complete cost of a new roof or a furnace when selling your home.  It may help add some conditional value, but in no way will you recapture the full cost of replacing something that the house needs to function properly.

Wrapping It Up

Understanding what makes a good comp for your home will help you have realistic conversations about pricing your home with any real estate agents you speak with.

When you have a good understanding of how and why your price the home the way you did, it will give you some confidence when negotiating an offer on your home. Correctly pricing your home can also speed up the sale of your home as well as make a less stressful transaction.

Hopefully, you now have a better understanding of what makes a good comp or comparable sale when pricing your home.