Key Steps to Selling a House

You might be excited by the prospect of selling your house and moving on to bigger and better adventures, but then the whole idea of actually selling your house may be a little overwhelming. There’s a lot to be done to secure the most return on your investment when selling your house. Here are six steps for successfully selling your property.

couple sitting on rug while moving1. Hire a professional real estate agent you can trust. Your agent should be an expert in the type of property you’re selling, and should be familiar with all the nuances of your neighborhood. Your real estate agent should have clear communication skills. If you’re uncomfortable in your first conversation, that’s probably an indicator that you’ve not yet found the right agent. Consider working with the agent who sold you the property if possible because you already have a rapport, but if that’s not possible, interview several agents until you find the right one for your needs. Ask about the exit strategy in case you need to replace the agent after a period of time. Some realtors have clauses built into their contracts to prevent you from terminating the relationship prior to a certain date.

2. Price your home properly from the start, leaving room for negotiations. Your real estate agent will provide you with a CMA, a Comprehensive Market Analysis, which will give you a solid idea of what buyers are willing to pay in your area for houses that are similar to yours. You may also decide to check your property tax statements for an estimation of your property value, use an online valuation calculator for an estimate of what you’re home might be worth, and get out in your neighborhood and look at the other houses for sale to see how yours compares. You don’t want to price yourself out of the market, and you don’t want to sell yourself short, so price effectively with room for negotiation.

3. Stage your property. Staging is one of the most important things you can do to prepare your property for market. Staging means that you clean, repair, replace, and arrange your property so it’s attractive to potential buyers. Staging covers the inside of your home, and the outside. Clean first. Then minimize – pack away or eliminate anything you won’t be using for the next 60 days. Remove any personal items like photos, political paraphernalia, collections (like salt and pepper shakers), and neutralize the space with soft, warm colors. Remember to clean under the sinks, in the cabinets, cupboards, closets, and drawers. If something is broke, fix it! Your home will undergo an inspection which will reveal broken or malfunctioning areas in your house, such as roofing, air and heat, water heaters, and other major appliances. If carpets are stained and torn, replace them, and if necessary, add a fresh coat of paint to brighten things up. Make sure your yard is manicured, free of debris such as trash, toys, and ornaments.

couple celebrating move4. Be security conscious. Remove any valuable items or weapons from your property and store them in a secure location. You may also wish to remove your pets during home showings and open houses as potential buyers may be allergic, may be irritated with pet behavior, or worse, your pets may be confused and agitated by the activity from strangers in their house.

5. Your house, once an offer is accepted, will undergo an appraisal to make sure you house is worth the amount the buyer is borrowing, and a home inspection to make sure the property is in good condition. Remember, you should have everything in good order during the staging process. If you don’t, any faulty items will be disclosed here and could cause delays or furthered negotiations in your selling price.

6. The final stage is closing, at which point the title changes from seller to buyer, all professionals involved in the transaction, such as lending agent, appraisers, inspectors, and real estate agents get paid. By this point, you should have all of your belongings removed from the property because you will not be able to return after the closing, unless otherwise negotiated in writing in your contract.

Call Real Property Solutions at 504-237-2942.

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What You Need to Know About Closing Costs

When you’re buying a house, you may hear the term “closing costs”. The reason that term is important to you, as the buyer, is that you will most likely be responsible for paying those closing costs. Closing costs are estimated to be anywhere from two percent to eight percent of the value of the property you’re buying. Your home mortgage lender will provide you with an estimate of what your closing costs will be, but those costs are subject to change up until three days prior to closing, at which time your lender will provide you a list of actual closing costs. Your closing costs are not covered in your home mortgage loan, nor do they come out of your down payment. When you shop for a property, keep in mind that you will likely be asked to pay twenty percent down as a down payment against your home mortgage loan, and then an additional two-eight percent for the closing costs. Here’s what closing costs may entail.

calculator and toy house on papersWhen you make an offer on a house, before the deal can be finalized, the home must undergo an appraisal. The appraisal is typically ordered by the bank to validate the value of the property to make sure it’s worth the amount you’re borrowing. In many cases, your real estate agent will recommend an appraiser, and the appraiser’s fee becomes part of your closing costs. If the appraisal comes back showing that the house is not valued for what is being asked, you have the ability at this stage to negotiate the price, or nullify your offer.

In addition to the appraisal, the house you’re buying must undergo an inspection. The inspection is to your advantage because it can reveal potentially hidden issues with the property, such as damaged roofing, malfunctioning heating and cooling systems, plumbing issues, electrical problems, or other items of disarray that could eventually end up costing you money. A lot of money! Ideally, the inspection will come up clean. However, if problems are discovered, you have three options. Your first option is to require the seller to make full repairs prior to your closing date. Your second option is to negotiate the price of the property so that you can pay for the repairs after you become the owner. Your third option is to withdraw your offer. Either way that home inspector needs paid for his services, and that is added into your closing costs.

Before the home can be legally sold, a title search must be performed. A title search verifies that there are no liens or tax levies against the property preventing it from being able to be sold. There are clerical fees involved with a title search, which are added to your closing costs.

The lending agent, who typically performs the credit checks prior to accepting your loan application, and who also provides the title search and other clerical processes, also gets paid, added to your closing costs.

couple smiling looking at house plansIn some cases, attorneys and other clerical services are required during the transaction. If so, there fees are also included in the cost you’ll pay on closing day.

Usually, an escrow agent is involved in the real estate transaction as well. An escrow agent is a third party professional who handles the filing of the paperwork and the dispensing of funds on closing day. The escrow agent makes sure all documents from both parties are signed, that the existing mortgage is paid in full, and that all professionals involved, including the real estate agents, are paid before the seller receives any proceeds from the sale of the property. So your real estate agent’s commission is also covered under the umbrella of closing costs.

If you’re not prepared for them, closing costs can catch you off guard. It is possible, in some cases, to negotiate that closing costs be paid by the seller, but more often than not, it’s the buyer’s responsibility. So when you go house shopping and you’re assessing your budget, know that you’ll need cash up front for your down payment, a good-faith deposit with your offer, and the closing costs at the end of the transaction.

Once all the closing costs are paid, the title is transferred to you, along with the keys to your new house. Call Real Property Solutions at 504-237-2942, and let us be a light for you when it comes to the home buying process.

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Things to Consider When Pricing Your House

Pricing your house to sell can be tricky. It’s not as easy as recognizing what you’ve paid into it, and then asking for that amount in return. The real estate market is flexible and your house may now be worth more, or less, than what you’ve paid. Naturally, you want to get the most out of your investment, but how do you know where to start? Here are some tips and tricks for properly pricing your house for the real estate market.

model house and calculator1. Understand that your emotional attachment to the memories formed in your house do not add to the value. Your memories are priceless, but sentimental value does not apply to real estate, so even though it may be hard for you to part with your memories, your memories do not escalate the value of your property. As hard as it may be to do, separate yourself from your emotions and attack the sale of your property as a business transaction.

2. A good place to start gauging the potential value of your property is by examining your property tax statements. Property taxes are based on a percentage of your home’s perceived value, so by calculating the property taxes, you may begin to form a picture of what your house is worth. Of course, property tax statements are lacking the human factor, so things like upgrades, landscaping, and general condition of your property are not considered.

3. There are ample resources online where you can get an estimate of your home’s value. Online calculators or valuation tools were designed to assist potential sellers in pricing their house to sell. On that same token, the human factor is still missing. Online tools can assess things such as size, number of rooms, and the general area in which your home is located, but they cannot adequately assess your home’s condition. However, when you add the online valuation estimates to the picture that began forming when you examined your property tax statements, that picture becomes a bit more clear.

Property Value Image4. Independent appraisers are another way to get an idea of what your home is worth, and will be more accurate than the estimate you garnered from your property tax statements and online valuation tools. And in this case, the human factor is present and working to your advantage. When you receive an offer on your house, your house will undergo an appraisal and an inspection as part of the closing process to determine that your property is worth what the buyer is borrowing. By having an independent appraisal done ahead of time, you’ll know what to expect. You may also be able to use that independent appraisal as a tool to aid in the sale of your property.

5. Your real estate agent is going to be your most accurate source of information when it comes to determining the list price for your house. Your real estate agent will provide you with a Comprehensive Market Analysis, or CMA. A CMA will demonstrate recently sold houses in your area that are similar to yours in terms of number of rooms, size, and house features such as garages or swimming pools. The reason it’s important to see what the houses sold for, instead of what they were listed for, is because negotiations often alter the price. The CMA shows what buyers in your area are actually willing to pay, as opposed to what buyers are hoping to get.

6. See for yourself. Tour your community and visit houses for sale. Get a deep understanding of the competition. Get a hands-on sense of the condition of the houses being sold, and the prices attached to them. Combine that information with your property tax statements, online valuation estimates, your independent appraisal, and your real estate agent’s suggested selling price. All of the numbers should point to a specific price range for your property.

When you are serious about listing your property for sale on the real estate market, contact Real Property Solutions at 504-237-2942, and let us use our expertise to aid you in the process of pricing your house to sell. Remember to leave room for negotiations! A little bit of prep and planning can add a lot of clarity to your home selling experience.

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6 Steps to Buying a House

Buying a house is one of the biggest investments you can make in a lifetime, and the financial obligations are intense. Buyer’s remorse is a sad but true true reaction when someone realizes a little too late that they’ve bought the wrong house. Here are six simple steps to buying a home that will help you go in informed, educated, and empowered for home ownership.

Couple dreaming about buying house1. Prepare your credit report and your savings account. Gone are the days when unqualified buyers can get a loan for a home. Now, your credit must be crystal clear and you have to have some cash on hand to back your commitment. Lenders are going to evaluate (quite critically) your credit score and employment history, so don’t change jobs or make any major purchases in the time leading up to your home buying experience. Know that if you are approved, you’re still going to have to make a good-faith deposit with your offer to the seller, an average of twenty percent of the home’s value as a down payment, and closing costs, which can be estimated at about 2-8 percent of the value of the property you purchase. There are some programs available that can lower or eliminate your down-payment, but those “savings” show up in your monthly mortgage payment and the duration of your loan.

2. Get pre-approved. It’s a horrible feeling to fall in love with a property, and then find out you’re not qualified to make the purchase. Or, you lose out on your offer because a competing offer did have pre-approval. Pre-approval accomplishes much more than the comfort of knowing you’re qualified to buy. Pre-approval of your home mortgage loan lets you know exactly what your home-buying budget is. Watch for interest rates, don’t be afraid to shop lenders for the best deal, and know that you are not obligated to accept the full amount of the loan for which you’re approved. Pre-approval also sends a statement to your real estate agent, and to sellers.

How Much Home Can You Afford?

3. Once you have your credit prepared, savings on hand, and pre-approval for your loan, it’s time to find a professional real estate agent you can trust. Interview agents until you find one with whom you can comfortably communicate, who is an expert in the types of property you’d like to buy, and who has extensive knowledge about the neighborhoods in which you’d like to live. A good starting point, if you don’t already have an agent, is to ask friends, family members, and associates for referrals. It can be comforting to know that someone with whom you’re close had a good experience with the real estate agent they’re recommending. Have your wish list and deal-breaker items ready, but be realistic and be prepared to compromise. It is common for a first-time buyer’s wish list to surpass the realistic budget.

couple packing boxes4. Enjoy the fun part, shopping, but beware of well-staged houses. Staging means the seller went to extensive lengths to make the house attractive, and sometimes “pretty” can be deceiving. When you find a house you think you might make an offer on, turn on every faucet, flush every toilet; look under every sink to make sure the area is dry and free of mold. Flip the light switches. You want to make sure there are no plumbing or electrical problems with the property. You should also look over the structure. Check out the ceilings, look at the floors, in the nooks and crannies. Look for cracks, peeling paint, splitting wood, or other indicators that the property may be hiding major problems. And when you’re ready, make an offer with your real estate agent’s guidance.

5. When your offer is accepted, the house you’re buying will undergo an appraisal to make sure it’s worth what you’re borrowing, and an inspection to make sure the house is in good condition.

6. When the appraisal and inspection are finished, you’ll enter the closing process. This is where the title is transferred, the professionals involved in the transaction receive payment (such as appraiser, inspector, real estate agents, etc), and the keys are handed over from the seller to you, the new homeowner.

Congratulations on your decision to buy a home. Give Real Property Solutions a call today at 504-237-2942 to discuss how we can light the way!

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