Summer sizzles in the real estate business - By Lisa DiBiase

Summer sizzle is still on. Increased inventory and low interest rates fueled Maine’s home sales this June. According to Maine Listings, Realtors report 1,513 single-family existing home sales last month—a rise of 14.02 percent compared to one year ago. The June median sales price (MSP) increased 0.54 percent to $185,000.
 

Sellers, it’s your market finally, so make the most of it today!

While you're interviewing agents, be wary of those “too-good-to-be-true” price opinions because they may be trying to "buy" your listing. And don't jump at that first (seemingly) generous offer, especially if sellers are getting multiple offers. If you're getting your price and then some, perhaps give something back to the buyer in good faith, such as an early move-in date or some personal property you're not attached to.

We hear that newly renovated homes are easier sells, and that's true. So is it time to remodel that outmoded kitchen? Not if you plan to sell soon. According to remodeling surveys, the average renovation project returns only about two-thirds on investment. For example, a major bathroom remodel costing $15,000 yields about $10,000 in resale value. The same goes for a major kitchen remodel. In some cases, it could be cheaper to issue credits to buyers or drop your price a few grand. Lighter jobs like new doors are more practical and return about 85 percent. But feel free to spend a bit on paint (basic colors), curb appeal and fence replacement to enhance exteriors.

Buyers, be credit-ready!

There's a lot of competition out there for homes, so be ready. Meet with a mortgage broker, get your credit report and start repairing any blips. If your scores are below 620 or so, a conventional loan will be a challenge. But if they're under 740, you still might not get the best rates. Many buyers get a pre-qualification letter from the lender, but you can one-up them with a pre-approval, which comes after a more thorough evaluation of your finances. A pre-approval letter shows the seller that you're good to go and can close quickly. Both letters work when making an offer.

Lowball offers are off the table in this environment and could eliminate you from consideration. Respond to counteroffers quickly to keep other buyers from entering the picture. By stalling you can create a bidding war. If one does break out, be prepared to get fewer concessions and pay more money. Have your realtor show a few other homes so you can be willing to walk away if the price soars beyond what you are willing to pay.

As I have said since the beginning, please call a local Realtor for all your real estate needs no matter how big or small. We are trained professionals here to make your life easier. It's best to surround yourself with the right team of professionals that can continuously give you the right advice for all your circumstances.

Lisa DiBiase owns and runs Landing Real Estate. For your real estate questions, email columnist@TheWindhamEagle.com.

Are you ready? - By Rick Yost

Buying your first home is a big commitment. It takes desire and stamina to work through the complicated and time consuming process. The responsibilities of being a homeowner are also challenging and can seem overwhelming. You know this, and yet you still find yourself on Trulia or Zillow looking at homes for sale in your favorite neighborhood, and maybe you have even tried to figure out how much you could afford to pay for a home. The big question is “Are you ready to buy your first home?”
 

Are you ready financially and emotionally to make the big commitment? Are you really ready for all that goes with home ownership? Are you ready to turn that rent check into a mortgage payment? There are some good signs that you are ready. Before you decide to take the plunge, consider the following.

Do you know that you are going to stay put for a minimum of five years? Owning a house on a short term basis rarely make financial sense. Your mortgage may be less than rent, but that does not truly consider the other costs associated with your home acquisition. Down payment, private mortgage insurance, and other closing costs add up quickly and drive the cost of homeownership up. The upkeep and maintenance has to be considered when buying a home and they also make short-term homeownership less attractive. If your job and your life will allow you to stay put for a minimum of five years, you might be ready.

Have you been pre-approved for a mortgage? Getting pre-approved is a quick and cost free process that lets you know how much home you can afford. This is also the time to find out what type of mortgages you qualify for. There are several great first time home buyer programs out there. You will also discover if you have any credit red flags that you should clear up. Being pre-approved also lets your realtor and home sellers know that you are serious about buying a home. If you are pre-approved to buy a home, you might be ready.

Are you flexible in your time frame? If your lease is up in a month, you are not ready to buy a home. Glitches and small problems hold up closing dates all the time. Closing in thirty days is not a sure thing. If you are not able to move for a year, you are not ready either. Housing and mortgage conditions can change dramatically in a year. If you are able to buy today, but are able to wait, you might be ready.

Do you have a nest egg? You need more than a down payment saved when buying a home. You will have closing costs, moving expenses, and home repair cost along with a down payment. The soft costs associated with buying a home add up quickly. Soft costs include new furnishings, window treatments, lawn mowers, etc. You will also want to have an emergency fund for unexpected repairs or financial setbacks. If you have a nice nest egg, you might be ready. 

Are you patient? The home buying process can be long and full of starts and stops. It can be frustrating, tedious and agonizing at times. Deals can go down the drain very easily. A bad home inspection, a bad appraisal, a deed issue, and more have all ended home purchases that I worked on this year. This leaves buyers unhappy and waiting for an issue to be resolved. Buyers are often forced to find another house. Patience is a major virtue under these circumstances. If you are patient, you may be ready.

If you have read this article and have answered yes to all the questions:

Staying put: Check

Pre-approved: Check

Flexible: Check

Nest egg: Check

Patient: Check

Then you may be ready.

Rick Yost is a realtor, a real estate author, and a long time Windham resident. You can contact Rick for all of your real estate questions and needs at columnist@TheWindhamEagle.com.

Negotiating a home sale - By Carrie Colby

When you list your home for sale, you may think you’ve priced it right, staged it beautifully, and timed the market for a quick sale.

The reality is that buyers are full of surprises. They rarely pay list price. They discount or dismiss improvements you’ve made. Their inspections usually turn up something for you to fix, and they may have terms that you weren’t counting on - like needing to sell their home before they buy yours. 

Whether you plan to or not, you’re going to have to negotiate. Negotiating doesn’t mean you win and the buyer loses, or you lose and the buyer wins. It’s simply a way to make smaller concessions so that you don’t lose the buyer and the buyer doesn’t lose your house. Negotiation is designed for both of you to get what you want.

You’ve done something right or you wouldn’t have an offer on your home, but a sale isn’t in the bag yet. Don’t blow it. Here are some negotiating mistakes to avoid.

Demanding top dollar for an aging property. Yes, the market is better than it was during the recession, but an older home that hasn’t been updated or maintained to perfection can’t compete with refreshed or newer homes.

When you’ve lived in a home for some years, you miss the dings and scuffs that make a home look used. You don’t see the age of your finishes and fixtures the way buyers see them. Even if it’s not torn or broken, buyers may see certain things as needing to be replaced.

Getting angry at a low offer. A buyer may make an offer for your home that is far lower than you feel it’s worth. Don’t take it personally - it’s a negotiating tactic. If the buyer didn’t want the home, there would be no offer, so at least you know the buyer wants to negotiate.

The buyers are using a low price to tell you something. Your job is to find out what that something is. Have your agent ask the buyer’s agent for the reasoning behind the low offer before you provide a written response. The buyer could be using inaccurate comparables, they could be trying to buy above their price range, or they may be investors who use a low-ball formula to acquire properties.

No offers or extremely low offers could be telling you that your home is overpriced compared to other similar homes. If your agent told you an estimated range where homes similar to yours are selling and you priced above that range, you need to lower the price. A low offer can also mean the market is slowing down and the buyer feels more confident. Ask your agent for an updated CMA so you can see where the market is heading.

Negotiations keep the dialog fluid and the buyer interested. In a seller’s market, you may expect buyers to give you multiple bids for your home and that could happen, but it’s rare. In a soft market, your buyer could simply walk away and find another home to buy because there are other homes on the market. You need to be flexible on the points that count most with the buyer, like move-in dates, and the buyer is more likely to be flexible with you on repairs or other negotiation points.

Remember, you want to sell your home and your buyer wants to buy it. Maximize your offers with good negotiating techniques and move on with your life. And when you buy your next home, you’ll be more experienced and a better negotiator knowing the seller’s side of things.

Carrie Colby is the broker/owner of Premier Properties in Raymond. To ask a real estate question for one of our experts, email columnist@TheWindhamEagle.com.

Getting the right comparison is important when listing a house - By Matthew Trudel, realtor

Home values or what your home is worth, is a big part of the equation when deciding to sell your property or not. Realtors generally use what is called a CMA, Comparative Market Analysis. It’s similar in some ways to getting an appraisal done, but we are not licensed as appraisers and there are no set guidelines for us to follow. Basically, it is just an opinion of value, and like all opinions, two people can have some very different ideas. You had better be involved and informed when you have a CMA done to help determine the value of your property. There are realtors out there who, in my opinion, don't look closely enough at the homes they are using for comparable, and therefore don't end up adjusting the selling or listing price accordingly. 
 

Example, many homes often report selling at or above the asking (list) price. Any home that has sold at or above the list price in today’s market most likely gave concessions (paid the buyers closing cost, gave money for new carpet, roof, etcetera.) A realtor doing a CMA and using a home that sold for more than the asking price has an obligation to research that transaction and find out the details of what transpired and adjust the CMA accordingly. 

Here is another reason you can get two very different opinions of values on your home. Realtors sometimes adjust higher or lower for certain items. If you have a detached 2-car garage, and the comparable sold property the realtor is using to price your home doesn't have a garage, did the real estate agent add $10,000 to the value of your home or did they add $20,000. Big difference for the garage that you know cost you $8,500 to build. 

Change it a little, and let’s say the comparable sold property does have a 2-car garage, but it is attached to the home with a small mudroom between the garage. Did the realtor adjust at all or just say, you both have 2-car garages so they are similar. The average buyer is willing to pay $7,500 to $10,000 more for an attached garage over a detached garage. Remember, that's just my own opinion. Through the process it is pretty easy to get a very inflated price on your home. So get involved in the process and ask questions.

This is very important! You need to know the realistic sale price of your home and price your home accordingly, taking into consideration the competition for similar style homes in your area. Work with your realtor and if you decide to sell, list your property at the price that will accomplish your goals in a time frame that is suitable to your needs.

Matthew Trudel is the owner of Five Star Realty, he has over 16 years of experience and is ready to assist you in all your real estate needs. He can be reached at columnist@TheWindhamEagle.com.