How to sell your home in a difficult market. The meltdown in the sub-prime lending market has created an earthquake in the residential property market. Real estate has always experienced cycles, but the current cycle is turning out to be far more severe than anything in recent memory. This time, not only are prices collapsing as the bubble bursts, but due to regulatory intervention and a drastic tightening of underwriting criteria, many qualified buyers are experiencing difficulty getting loans for property they can easily afford. Read on to learn how to sell your home effectively or jump to my story of How I sold my home in one week.
What is Home Staging?
A keen understanding of "Home Staging" is critical if you intend to sell your home for a halfway decent price in today's bitterly competitive and difficult market.
Part marketing, part decorating, part psychology - home staging will make your property more desirable to prospective purchasers. Simply calling a realtor will not do.
Why won't my condo sell?
A few years ago, I had an opportunity to relocate overseas. I owned a few properties that I managed to sell, but my favorite one - a condominium on the beach - would not sell.
Fortunately, my younger brother and his wife thought that living on the beach suited them, so they rented the condominium from me at a price that just covered the mortgage.
After a few years, they decided to move out, and then I was in a mad scramble to sell and not pay nearly $1000.00 per month in mortgage, common fees, taxes, etc.
The place would not sell. Months went by, costs added up. Finally, I had to come back to the US for a week to prepare it for sale. When I finished, it sold in a week. What did I do?
My brother-in-law's sister has a real estate license...
As much as you would like to help your family and friends, this is not the time to do it. Every hour, every minute, every second your home does not sell costs you money.
Sell your home quickly!
Homes were sold even during the Great Depression
Just calling a realtor is not enough these days. A realtor is playing a numbers game, and hoping that if they get enough listings, something will sell and generate them a commission. They are not interested in helping you sell at a fair price. They would like to see you sign any old contract and sell at any old price, but they have a lot of other customers, and simply do not have the time to invest in educating each of them. In today's market, listings are expiring by the dozens.
Realtors make money even if you lose your shirt. They have no interest in seeing you get a fair price, they have an interest in getting you to part with your property even at fire sale prices, then it's on to the next deal for them. They are just as happy if the market is going cheap as long as things are selling.
These pages will give you sound advice to help your home be one of the few that sell, and hopefully, sell at a good price. You will learn about Home Staging and how to kill off the invisibles. You don't know what "Home Staging" and the "Invisibles" are? Keep reading, and you will come a few steps closer to selling your home.
Home ownership - a key part of the American Dream. A home is often a family's largest investment, and unfortunately, it is the least liquid. Selling a home is arduous and fraught with emotions that do not encumber selling other investments. Husbands and wives who would never argue about selling a half million dollars of Microsoft stock will bicker like schoolchildren when it comes to selling the family home - just another investment - really....
- Find out what your home will be worth when the crash ends.
- How can you sell your home fast in this abysmal market?
- What sort of tips and tricks are there?
- Should I use a realtor or go it alone?
- Where can I advertise online to get fast results?
- What should my advertisement say?
- What are some of those 'dirty tricks' that pros use?
- How to fix your home to sell, sell, SELL!
It's a Tough Market - So Get Tough!
PEOPLE SOLD HOUSES EVEN DURING THE GREAT DEPRESSION
The real estate cycle can take years as it saunters from bust to boom. Do you have years to sell your home? The crash can also take years from the time it starts until it bottoms out - a minimum of two years of crashing prices with no bottom in sight. When will the property market hit bottom? How much will your property be worth when it does? What price should you sell it at? If you are a real estate speculator sitting on a pile of cash, perhaps you can afford to wait for things to rebound. Most of us cannot.
REMEMBER THE JAPANESE REAL ESTATE CRASH?
Japan - In Japan property prices crashed by some 75% from their peak over a period of some ten years. Sellers who hung on hoping for a better price watched their properties lose more than 75% percent of their value - all the while hoping that the market would turn around.
I DON'T HAVE YEARS TO SELL MY HOME!
If you are relocating due to work or for any reason, and cannot afford to wait 8-10 years for the market to swing back, then there are things you need to do urgently to motivate, entice and catch the increasingly rare qualified buyer who is ready willing and most importantly - ABLE - to close on your home!
THESE PAGES WILL HELP YOU SELL!
They were written by me! Someone who made a fortune in real estate, and then lost a fortune in real estate. Then made millions once again - in real estate - over more than 25 years. I did it in the USA and in Europe. Feel my pain. Learn from it. Sell your home for a good price and do it quickly! Time is money.
Sold in a Week
I was under the gun and really had to sell my house - fast! I had relocated to Europe and the market was terrible. Then my tenant moved out and the mortgage, taxes and common fees were eating me alive. I spent exactly one week remodeling and painting myself, then the following week the home hit the market and sold!
Historical P/E Ratio
There have been a lot of articles in the real estate press lately about the historical P/E Ratio for homes.
Just like other investments, home prices also can be evaluated upon the basis of a P/E Ratio.
A P/E (or Price/Earnings) ratio is the ratio of the price of an investment divided by its potential earnings. Just as for stocks and other investments, there are 'equilibrium' PE Ratios for homes - the magic number is around 15. A PE Ratio of 15 is about the historically correct price for real estate in a normal market. When the bubble bursts, the ratios will go below this for a time and eventually come back to equilibrium.
OKAY, SO HOW DOES IT WORK?
So if your home would rent for say, $2000 per month, that is $24,000 per year. Multiply that times 15 and you get $360,000.00 - the equilibrium value of your home. That is a very simplified way of looking at it. A real investor would deduct costs, such as taxes, maintenance 5% for vacancies and other, but in a nutshell, these ratios have stood the test of time.
Sell Cheap or Rent?
Â Some people have chosen to rent their homes instead of selling at a huge loss. This may make sense if your rental costs can cover your mortgage, taxes and expenses. On the other hand, if you are hoping to stem the losses until prices rebound - you may have a very long wait. If your costs are very low - this may be a very good option.
Â Â Â If you are losing money on the property by the bucketload - even after it is rented, then unfortunately, you may be only delaying the pain and eventual day of reckoning.