If you decided to sell your Lake Tahoe home, then chances are you have thought a lot about the selling price. If you are new to doing real estate transactions, there are a few key things to follow when pricing your home that can aid in getting it sold quickly.
Price it right
Most seller’s think their home is great and typically pick a selling price that is based more on how much money they want to make, and not so much on actual market factors. Pricing your home right from the start will determine how long the house sits on the market. A majority of Realtors will tell you that the first two weeks of exposure are the most important. When you come in at a good price, the chances of getting a lot of buyers touring your home is high. If the home sits on the market for too long because it is priced too high, it creates the perception that something is wrong with the home. It also sometimes causes buyers to think you are desperate to get an offer resulting in low ball numbers.
Comparable SALES are key
Want to know how much you should list your home for sale? Look at the “comps”. While you can look at other active listings within the neighborhood that are similar to your home, the best way to figure out asking price is looking at the solds. This will tell you what people are willing to pay for a home like yours. The number of beds, baths, square footage, lot and upgrades are a few good things to look at when comparing your home to your neighbors. A qualified Realtor will be able to provide you comparable activities straight from the MLS and help you pick a good asking price.
Keep it fair while comparing
If your home is a darling 1970’s Lake Tahoe ski chalet with original appliances and shag carpeting, chances are it is not going to be the same price as the brand new construction across the street. Even if you have the same square footage and amount of bed and bath, it isn’t realistic to think that you will get the same amount. This is where paying attention to the comparable Lake Tahoe properties your agent gives you is very important. They are only going to pull homes that are truly similar to yours.
Do a little background check
To get an all inclusive idea of the real estate market on your block, check the listing history. Look at the amount of time a home was on the market, the original listing price to the final sold price. This will be another area where your Lake Tahoe Realtor is going to be of service with a wealth of information.
Consider those home improvements
Consider whether or not those recent upgrades you made warrant a higher listing price. A big high end remodel can definitely be reflected in the home price, just don’t expect to get your full return on investment back. While upgrades help, they don’t always get back as much money as you put in. Every situation is unique, so be sure to chat with your Realtor about this.
Consider supply and demand
Are you selling your home in a buyers marker or a sellers market? If it s a buyers market, your home will have a lot more competition and you may want to ask a bit less in order to attract the right buyer. In a seller’s market there is a smaller inventory with a big buyer demand so you can ask a bit more.
As every home and neighborhood is different, like every seller’s situation, you will want to make sure you discuss with your Realtor what the most attractive selling price is for your home. If you are looking to sell and would like more information, give us a call at 530-577-0389.
It’s that time of year when we try to dust off the old crystal ball and see if there are any indications as to what the upcoming year might have in store for us. While we can never seem to totally rely on that crystal ball’s findings (should have sold our Lake Tahoe house in 2006 despite that ball telling us to hang on), it is always a good idea to at least pay some sort of attention.
Buyers will be most pleased with the just released 2015 California real estate forecast. While the home sales throughout the state are expected to increase slightly, experts are predicting that home pricing gains will be the slowest in four years. According to the California Association of REALTORS®, “the California housing market is expected to return to a traditional buyers’ market with less investors due to more available homes for sale with prices flattening out and sales rising at a modest pace.” As the last couple years have put some buyers home purchasing plans on hold due to the home price increase and strict guidelines for underwriting, this year puts home buyers in a better financial position to make a real estate purchase.
Another plus for buyers looking to purchase more affordable homes is that we are seeing an increase in the variety of programs giving home buyers the ability to buy a home with less than the standard 20% down payment. For example, there are FHA loans that allow buyers to make a down payment as small as 3.5% of the purchase price. It still makes us nervous when we see offers with these low down payments come across our desks yet they sure seem to be working. Mortgage interest rates have been the lowest in years and will most likely rise to around 4.5% which is still historically low. The positive news continues as unemployment is expected to decrease to 5.8% from the previous year which was 6.2%. With all of these factors combined, C.A.R. predicts existing home sales will have an increase of 5.8 % next year as well as reach 402,500 homes sold. The median home price forecast throughout California is expected to increase to $478,700, up 5.2% from 2014. The median home price for homes in the South Lake Tahoe area is currently $336,000. If the same rate of 5.2% increase holds true for the South Shore, we should see a median home price of approximately 354,000 next year at this time.
The Bay area specifically is expected to outperform compared to other regions due to tighter housing supply and strong job market. This is important to note as the majority of Lake Tahoe home buyers come from this area. On a national level, the 2015 real estate forecast varies depending on which economist you listen to. However, there is a general consensus that, like California, home sales will increase.
What a busy month we had in the So. Lake Tahoe real estate market. Historically, November is a rather “sleepy” month with folks gearing up for the holidays instead of buying and selling homes. However, this past November found us all answering more phone calls than usual. When we checked the stats for November, our suspicions were confirmed. November 2014 was definitely a good month for Lake Tahoe buyers and sellers. Not only was it busier, the median home price showed a continued rising trend.
I thought it would be a good idea to compare just the month of November with 2013 and again, found some pretty positive news. In regards to just November of 2014 compared to November 2013, we found: The number of new listings stayed the same with 39 each year while the number of homes on the market is nearly the same with 261 compared to last year’s 263. Furthermore the monthly supply of inventory remained rather stable with 2014’s 4.7 compared to 2013’s 4.5. This is the time it would take to sell all homes currently on the market if all outside factors remained the same. Improvements were seen in the following categories: The time on the market (from list to sale) was down from 136 to 127 , the % of sale to original list price was up from 92.4 to 94.2 and the median home price rose 2.9% from $350,000 t0 $360,000. The only downward trend we saw was in regards to the number of closed sales. In 2014 there were 51 closings while we only saw 43 reported for this year.
When studying the twelve month average (Dec. 1 through Nov. 30), it appears the overall activity is slowing down a bit. The good news was that the statistics showed a 7.6% increase over the same period last year. The median home price stands at $340,000 as compared to last year’s $316,000. The remaining categories reflected trends of a stabilizing market. The days on market was nearly the same with 118 last year and 119 this year. On the other hand, the number of closed sales dropped from 698 to 632, the monthly supply rose from 4.4 to 5.5 (under 5 is a seller’s market while 5-6 is a balanced market), and the number of homes on the market rose from 261 to 305. Knowing of the improvement over the month of November, it will be interesting to see if the overall numbers creep up a bit. Stay tuned.
As we have previously stated, it is incredibly important to do a little research before picking the REALTOR® that is going to work alongside you during your entire home buying or selling transaction. While there are important qualities and traits to look for in a REALTOR® there are also some necessary questions to ask during the interview process. And yes, you should interview an agent! You wouldn’t hire an employee without interviewing them at least once, so why would you blindly hire someone to advise you on one of life’s biggest financial investments? Below are a few questions you should ask a potential Lake Tahoe REALTOR®.
How long have you been in real estate?
How long one has been in the business doesn’t necessarily guarantee that an agent is the best. However, real estate is a career where experience is gained on the job. It is also a constantly changing industry. Having someone who has been in the business for a long time suggests that they have a good grasp on the ins and outs of the business, the local market trends as well as national and global real estate news. This knowledge combined can go a long way when purchasing a home, or selling one. If they are new to the industry, there is still a chance they will bring valuable skills to the table along with a fresh outlook and energy. If these are traits you want and yet you know that the agent’s real estate experience is limited, ask if they would be willing to join efforts with a more experienced agent.
Is being a Lake Tahoe REALTOR® your full-time job?
When searching for a REALTOR® you want to make sure that real estate is their main focus. In a town like Lake Tahoe, there are several REALTOR®s who have second jobs. While this isn’t a bad thing, you want to know that you and your property is among their top priorities. You also want to know that they are available “upon demand” to handle unexpected questions, time-sensitive issues and the flexibility to work with your personal schedule.
What designations do you hold?
There are certain designations, such as CRS® and GRI, which require REALTORS® to take specialized real estate training in addition to the minimum requirements to become licensed. This extra training shows dedication not only to their clients and career, but a love for the industry in general. One of the most important certifications you should be looking for, when interviewing Lake Tahoe REALTORS® is the Lake Tahoe Local Area Governmental Agencies Specialist. This is a certification achieved by demonstrating a minimum level of knowledge in regards to the various local agencies such as the Building Departments, TRPA, US Forest Recreation Cabins and more.
How many homes did you and your real estate brokerage sell last year?
The answer given to this question will give you a good idea of how much experience a Realtor has. Keep in mind market conditions when asking this question. A fabulous, experienced agent could have had a slow year due to market conditions and a mediocre agent could have had a great year because it was a seller’s market and the demand for homes was high. Be sure to do your homework and ask where you can view testimonials from prior clients.
What was the average amount of days it took you to sell a home and how did that compare to the overall market?
A REALTOR® should have these facts on hand and be readily available to present these upon request. Additionally, they should be able to provide a comparison of the current market statistic from the local MLS. Once again, there could be factors present that don’t reflect the Realtor’s ability to do their job, so keep that in mind.
What were the final sale prices of most of your listings and how close was that to the initial asking prices?
While there can be some extenuating circumstances present, such as a hot real estate market or a sssllooowwww one, this is one indication of how a skilled REALTOR® prices their listings and markets them to suitable buyers.
How will you market my home?
There are so many amazing resources and tools at Realtor’s finger tips these days that you want someone who is aware of the best innovative marketing tools and the most effective ways of using them so they reach suitable buyers. You don’t want someone who’s going to put a For Sale sign in the yard, hold one open house and then hope the house sales within 24 hours. Seek a Realtor that has cutting edge technology at their disposal and isn’t afraid to use it.
Can you recommend service providers who can help me find a mortgage, make repairs and assist with my home’s needs?
A good REALTOR® will usually work with the best in the industry and therefore give you quality referrals. Typically they will suggest a few different providers for each category and be able to give you a little insider info on each one.
What’s your business philosophy?
This is one of those questions that doesn’t really have a right or wrong answer. However, it will give you valuable insight on what a realtor’s goals and priorities are and you can get a good idea if you are both on the same page.
How do you update your clients on the transaction and how often?
Like the above, this doesn’t have a right or wrong answer. Most agents are good at updating their clients based on their requests, but it is good to know how often a Realtor finds it necessary to touch base with clients, and how they do it. With so many ways to communicate these days, everyone has a preferred method. Do you want your agent to call you on a specific week day with an update, or are you fine with a text update only when something major happens? Be sure to gauge their reaction to your request. If they seem noticeably disappointed at your need for a weekly face to face meeting, you may want to search for a Realtor that is ok with a more personal approach. A quality Realtor will be focused on a good working relationship with their client, and that means communicating in a way their client desires.
So you are in the market to buy a Lake Tahoe home. Where to start? The most important place to begin is finding out how much you can spend on a home to buy. This is best accomplished by meeting with a licensed mortgage broker with the purpose of getting pre-approved for a loan. Now, let’s clarify first that there is a difference between getting pre-qualified and pre approved. A big difference in fact. Pre-qualified is when you provide a lender or bank your basic financial information such as income, debt and assets. After reviewing this information, a lender will give you an idea of the mortgage amount you could qualify for. Keep in mind, there is no fee to do this and the process can be as simple as a phone call to a bank or even a quick online form. It also does not evaluate your credit report or other in depth factors that could affect your ability to purchase a home. On the other hand, obtaining pre-approved status involves completing an actual mortgage application that may cost an application fee. You also have to provide the lender with the appropriate documentation, such as tax returns, proof of income and financial statements so that they can do an extensive check on your credit and financial background. Once this has been evaluated, the lender will give you a specific mortgage amount as well as a good idea of the interest rate you will be charged. As you can see, there is quite the difference between the two.
Now that we have addressed this, let’s discuss why it is important to get pre approved before you start searching for homes.
You know you can buy a home
Searching for a home to buy is a process, for both the client and your Lake Tahoe Realtor®. Nothing is more frustrating for you and your Realtor® than to spend hours and days looking at several different homes only to find out you don’t qualify for needed financing.
You know how much you can spend
This saves time and helps define your search. Once you know how much you are pre-approved for, you can then go to your Lake Tahoe Realtor® with your pre-approval letter and they can look for homes in the MLS within that price range. The MLS search will yield results that you can afford and you don’t waste time getting attached to homes outside of your budget. You can also arrange to be notified via email of all new listings that come on the market within the parameters you set. If one pops up that grabs your attention, you are one step ahead of the competition.
A Pre-Approval Letter gives you more leverage in negotiations
When competing for the purchase of a home, sellers will usually lean toward a buyer that has provided a letter of pre-approval over a buyer that is only pre-qualified. However, a letter of pre-qualification is better than nothing.
Now, if you decided to start looking before getting pre approved and found a home you absolutely love, don’t wait. Contact your local Lake Tahoe Realtor®, put in an offer. Within that offer, you can state within that offer a time-line in which you will get pre-approved in order to assure the seller that they aren’t taking their home off the market for too long of a time prior to being assured that you qualify. As real estate is constantly changing, so are the homes on the market. If you know you have the financial ability and proof to afford a home, get the offer in and then speak with a preferred lender as soon as possible. As you can see, the benefits of getting pre-approved ahead of time is the best way to get the home buying process started. If you have any questions regarding the buying process, give us a call at 530-577-0389. We are more than happy to connect you with respected lenders with whom we have worked successfully with in the past.