In 2012, the pendulum of the North County real estate market has swung in favor of the home seller, out of the hands of the home buyer.
Record low, fixed-rate mortgages, some as low as 3.35 percent, are pushing many buyers into the market and increasing the demand for housing and investment property. Average sale prices in North County are moving higher, with more buyers bidding on fewer and fewer homes.
The current market bodes well for homeowners, as persistent low-inventory is expected to continue through the year. With the help of today's low mortgage rates and government refinance programs, the flood of foreclosures has dwindled. Future homes for sale are expected to come from traditional sellers, who will remain reluctant to list their properties until prices are above their current levels.
The question for many homeowners is, "If I sell, where will I go?" So many are foregoing selling their homes and choosing instead to refinance into a lower fixed-rate mortgage and lower their expenses.
Those owners that sell are getting fresh advice from their brokers to price their homes higher than the most recent comparative sales. The average single family home in Carlsbad under $1 million is now listed for $675,000 versus $654,000 during the same period last year. Homeowners are also securing more of their asking price: an average 98 percent of asking versus 97 percent in 2011.
Non-distressed property is averaging around 46 days to sell. But it is not an 'easy' market for home sellers. Homeowners must find the 'right' buyer amidst possible multiple offers, work through a low appraisal on the buyer's loan and do battle with the always cancerous buyers' agents who plot to renegotiate terms during the escrow period.
Homeowners are finding today's homebuyers remain fearful of 'over paying' in the current real estate market. A buyer may offer on many homes simultaneously or continue to look and offer on other homes while in escrow. This buyer is likely to initially offer below-asking price; sometimes as much as 5 percent or 6 percent below the listed price.
A homeowner is wise to remain steadfast in their asking price for the first 45-60 days. Ignore low offers and unrealistic buyers fishing for a 'deal'. North County home prices are not declining as they were from 2006-2009. There are fewer competing homes and choices for homebuyers.
Brokers are finding buyers making an offer on property, breaking negotiations when terms are not met, only to have the same buyer circle back and accept the seller's counter offer two weeks later. Properly understanding buyer motivation is a key element of success in today's marketplace. Great selling agents will find out how long has the buyer been looking for a home, what have they offered on and what are the buyers wants versus their needs. If the property backs up the open space and the buyer highly favors a view, the pool of competing property just got smaller.
If a deal is made, today's homeowner should prepare for the buyer to renegotiate terms within the escrow. With fewer homes for sale, a buyer may make an aggresive offer to avoid losing the home to a competing buyer. However, it is becoming increasingly common for that same buyer to then use the 17-day inspection contingency period, often called the "free look period," of an escrow to make back some of the ground lost in the offering phase.
Buyers' agents may ask for a reduction in sale prices or credits in lieu of repairs to roof, flooring, appliances, etc. They may even use a conservative, low buyer loan appraisal to ask for a price reduction. With the threat that the same challenge will remain for the next buyer. Every case is unique, but today's owners are finding they can push back against such requests or find a reasonable middle ground to create a "win-win" scenario.
Lund can be reached at [email protected].
REAL ESTATE BUZZ
Three easy steps to a higher selling price
Too few homeowners realize the importance of preparing a home for sale.
The process of homebuying is impulsive. Judgment is rendered in moments of walking through a property. Yet many homeowners will go on this "first date" with a potential home buyer without combing their hair or ironing their clothes.
The importance of the homebuyer's first impression of the property is paramount and will assure the owner the best possible outcome. Homeowners can help maximize their sale price with some of the following steps.
1) Depersonalize the property. Family portraits and personal mementos should be stored and/or replaced with non-distinct decorations. It is difficult for many buyers to walk through a highly personalized home and picture themselves making it their home.
2) Remove excess furniture or kitchen appliances. Open up walkways and thin large pieces of furniture to create an open feeling in living areas. Declutter a kitchen by removing the coffee maker, blender or other excessive appliances. Work to create a clean, open feel in the areas of the home that buyers typically pay attention to the most: kitchen and living areas.
3) Finish your fix-it list prior to sale. A fresh coat of paint, small handyman fix-it items and even replacing low-E light bulbs with non-efficient (but much brighter) traditional bulbs are small, yet important steps to creating an inviting feeling in the home.
These are low-cost items that have a tremendous impact on a buyer's first impression.
Also, staging the front yard with new flowers, ground covering or overall general maintenance to improve the first impression of the home will pay dividends in the sale.
If you are unsure on what items will be the best "bang for your buck", talk with an experienced real estate broker or home staging professional to garner a third party perspective.
Proper planning and a little "sweat equity" will help you create the right first impression and maximize your ultimate sales price in the current market.
?By Tyson Lund
Record low, fixed-rate mortgages, some as low as 3.35 percent, are pushing many buyers into the market and increasing the demand for housing and investment property. Average sale prices in North County are moving higher, with more buyers bidding on fewer and fewer homes.
The current market bodes well for homeowners, as persistent low-inventory is expected to continue through the year. With the help of today's low mortgage rates and government refinance programs, the flood of foreclosures has dwindled. Future homes for sale are expected to come from traditional sellers, who will remain reluctant to list their properties until prices are above their current levels.
The question for many homeowners is, "If I sell, where will I go?" So many are foregoing selling their homes and choosing instead to refinance into a lower fixed-rate mortgage and lower their expenses.
Those owners that sell are getting fresh advice from their brokers to price their homes higher than the most recent comparative sales. The average single family home in Carlsbad under $1 million is now listed for $675,000 versus $654,000 during the same period last year. Homeowners are also securing more of their asking price: an average 98 percent of asking versus 97 percent in 2011.
Non-distressed property is averaging around 46 days to sell. But it is not an 'easy' market for home sellers. Homeowners must find the 'right' buyer amidst possible multiple offers, work through a low appraisal on the buyer's loan and do battle with the always cancerous buyers' agents who plot to renegotiate terms during the escrow period.
Homeowners are finding today's homebuyers remain fearful of 'over paying' in the current real estate market. A buyer may offer on many homes simultaneously or continue to look and offer on other homes while in escrow. This buyer is likely to initially offer below-asking price; sometimes as much as 5 percent or 6 percent below the listed price.
A homeowner is wise to remain steadfast in their asking price for the first 45-60 days. Ignore low offers and unrealistic buyers fishing for a 'deal'. North County home prices are not declining as they were from 2006-2009. There are fewer competing homes and choices for homebuyers.
Brokers are finding buyers making an offer on property, breaking negotiations when terms are not met, only to have the same buyer circle back and accept the seller's counter offer two weeks later. Properly understanding buyer motivation is a key element of success in today's marketplace. Great selling agents will find out how long has the buyer been looking for a home, what have they offered on and what are the buyers wants versus their needs. If the property backs up the open space and the buyer highly favors a view, the pool of competing property just got smaller.
If a deal is made, today's homeowner should prepare for the buyer to renegotiate terms within the escrow. With fewer homes for sale, a buyer may make an aggresive offer to avoid losing the home to a competing buyer. However, it is becoming increasingly common for that same buyer to then use the 17-day inspection contingency period, often called the "free look period," of an escrow to make back some of the ground lost in the offering phase.
Buyers' agents may ask for a reduction in sale prices or credits in lieu of repairs to roof, flooring, appliances, etc. They may even use a conservative, low buyer loan appraisal to ask for a price reduction. With the threat that the same challenge will remain for the next buyer. Every case is unique, but today's owners are finding they can push back against such requests or find a reasonable middle ground to create a "win-win" scenario.
Lund can be reached at [email protected].
REAL ESTATE BUZZ
Three easy steps to a higher selling price
Too few homeowners realize the importance of preparing a home for sale.
The process of homebuying is impulsive. Judgment is rendered in moments of walking through a property. Yet many homeowners will go on this "first date" with a potential home buyer without combing their hair or ironing their clothes.
The importance of the homebuyer's first impression of the property is paramount and will assure the owner the best possible outcome. Homeowners can help maximize their sale price with some of the following steps.
1) Depersonalize the property. Family portraits and personal mementos should be stored and/or replaced with non-distinct decorations. It is difficult for many buyers to walk through a highly personalized home and picture themselves making it their home.
2) Remove excess furniture or kitchen appliances. Open up walkways and thin large pieces of furniture to create an open feeling in living areas. Declutter a kitchen by removing the coffee maker, blender or other excessive appliances. Work to create a clean, open feel in the areas of the home that buyers typically pay attention to the most: kitchen and living areas.
3) Finish your fix-it list prior to sale. A fresh coat of paint, small handyman fix-it items and even replacing low-E light bulbs with non-efficient (but much brighter) traditional bulbs are small, yet important steps to creating an inviting feeling in the home.
These are low-cost items that have a tremendous impact on a buyer's first impression.
Also, staging the front yard with new flowers, ground covering or overall general maintenance to improve the first impression of the home will pay dividends in the sale.
If you are unsure on what items will be the best "bang for your buck", talk with an experienced real estate broker or home staging professional to garner a third party perspective.
Proper planning and a little "sweat equity" will help you create the right first impression and maximize your ultimate sales price in the current market.
?By Tyson Lund