Hello everybody and Happy Thanksgiving!
We just finished our first project in North NJ and looking for a dead RE season. We want to sell as quickly as possible. Talking to RE agents our price and advertising are right. One of the RE agents suggested to put a real LOW price and accept the highest offer. Do you think this is a good idea? Any other options to sell quick?
Thanks for your advise.
Real estate is extemely price sensative. If you want to sell, lower your price. (I am going to assume that since you just renovated, you’ve got good curb appeal and everything is nice and clean inside)
I wouldn’t price it too far below market, because when things are slow, you aren’t going to get a bidding war.
Quite often a drop of just a few thousand dollars will make yours the most attractive.
If you are really serious about selling, go out and look at what is for sale and have yours priced slightly below properties that the exact equal in attractiveness, location, and square footage.
That is what the buyers are going to be doing. They have a set amount that they are going to spend. They go out and buy the very best house that they can get for that amount of money. All you need to do is to be the most attractive and the best deal in that price band.
Traditionally, houses sell a lot better in the spring and don’t sell at all during the winter. We’re all spoiled by the smoking hot markets of the past few years and have forgotten how a normal market works.
One more suggestion: buyers are having a bit of trouble getting loans, so it sometimes works to buy down the points so that it is easier fo them to qualify. Financing is always a serious issue with home buyers.
The easier it is for them to qualify, the easier it will be for you to sell your house
Thank you for your answer. This is exactly what we are trying to do. We marked the propert 10K lower than the existing market, hopefully this should attract the buyers.
What about the market. Do you think teh market will go up in January 2008?
Why January? The market is so local. It may or may not go up in your area. It may even go down!
What was your exit strategy you planned on when you bought this property? You should be exercising that plan now.
With the way the mortgage meltdown is going - it’s likely going to be mid next year at the very earliest before all the bad numbers start to turn around and likely much longer than that.
I’m in New England, so we’re not that far apart.
Here’s my take on 2008…
UGLY!!!
This entire real estate bust really got rolling with $200 BILLION in ARM loans re-adjusting for the first time in 2007. I’m not talking about sub-prime, this is about people who purchased homes in 2005-06 with ARM’s because they could not afford to buy any other way.
In 2007… $200 Billion in ARM’S adjusted for the first time. (fuse lit)
Now for the BAD news…
In 2008… $900 BILLION IN ARM’S WILL RE-ADJUST FOR THE FIRST TIME!!! (bomb explodes)
That means 4 1/2 times as many people may see their mortgage payments double or even triple.
The problem is once these loans re-adjust they can’t afford the new payment. Originally the theory was that housing would continue to rise and they could just refi into a conventional mortage.
As we all know, THAT didn’t happen. The reality of the situation is that the prices of their homes actually DROPPED!! THAT is the key here, because prices dropped the home they paid $300,000 in '06 is now worth $225,000. As we all know, there isn’t a bank on earth that is going to loan ANYONE $300,000 on a house that now appraises for $225,000. Add to this, MUCH more stringent lending requirements, a looming recession, and you have a recipe for future price declines WELL INTO 2009 and beyond.
My advice to you is AGGRESSIVELY Price the home and SELL IT.
There is no way in hell that this market does NOT continue to fall throughout 2008. Don’t forget to add in a nice recession which is no doubt on the horizon and you will be doing good if you sell the home for $10,000 less than current ask.
Sorry to be so negative, but reality is reality.
Look whats going on around us. $100/ barrel oil, U.S. dollar at NEVER BEFORE seen lows, and Real Estate deflating by the month.
Believe me when I tell you this…we have not seen even the TIP OF THE ICEBERG when it comes to Wall Streets exposure to the falling real estate market. This sub-prime thing is so bad that NO ONE knows where the bodies are buried. I can tell you this without hesitation. Those bodies are gonna start to stink in 2008. When that happens be prepared…
I’ve been around the block a few times (20+years investing) I have NEVER
seen a housing decline like this that DID NOT bring the entire U.S. economy down with it. Housing is HUGE, it effects COUNTLESS good paying jobs from carpenters, electricians, truck drivers, furniture makers, even car sales. The problem is, these jobs can actually support home ownership, but they are going bye bye. Replacing them with $8/hr WalMart or Home Depot jobs is not going to cut it. It’s a vicious cycle.
I have numerous sub-contractors who have laid off half their help in the last 6 months. These guy’s made $15 to $20/hr ALL of them are at Lowes or Home Depot making between $8 and $10/hr. That isn’t good for anyone.
Pay attention here folks… This is where people get HURT! I’m not talking about the dopes who bought houses they couldn’t afford, with mortgages that made no sense. I’m talking about US! I have seen countless real estate investors lose EVERYTHING because they failed to see or didn’t want to admit the obvious.
Here’s my advice…
If you weren’t buying and selling homes before 1995…YOUR A NEWBIE!!! Think about that for a minute, you could have 12 years experience and you have never seen what we’re ALL about to see. You have invested in a RISING market ONLY!! New ball game now folks.
BE CAREFUL. Don’t get me wrong, there will be TREMENDOUS deals out there. But you better have the bank roll, the plan, and the FINANCING to take advantage of it. Or it WILL, take advantage of YOU.
You’re a long distance from me, but in my area, the shoppers aren’t out looking at houses until the snow is off the ground. So there’s a good chance that January will be too soon.
My outlook isn’t as dark as jake’s. I’ve been investing for a lot of years and real estate cycles. It always has and it always will. I quite honestly don’t care what the price is until the moment that I sell.
If you are, by any chance, commuting distance to NYC, you might be OK. Because the dollar is so weak, European real estate investors are slowly starting to realize that there are serious bargains in America for people who can pay in Euros.
See all the Christmas shopping TV specials going on about the Europeans coming to the USA and loading up on Christmas presents? They are aleady glancing sideways and sniffing the air at American real estate.
Since you have to sell, you need to really make sure the place is clean, has curb appeal, is move-in ready, and then drop your price or else offer financing assistance.
Good luck to you.
fdjake…
ggggreeeat post!
as usual…you’re right on top of things.
-Mike
A couple of things that I have used to sell homes fast are