Real estate gems abound during late-peak sales season

Low rates, new loan products foster favorable environment
By: Robert J. Bruss: Inman News
You probably have been reading and hearing about the record home sales volumes and prices in most communities. Although it's summer when home sales volume usually slows after the peak sales season of April, May and June, it's not too late to sell your home if you are motivated. If you are a home buyer, bargains appear as the peak sales season cools and buyer competition becomes less intense.

Home mortgage interest rates remain near record lows. Procrastinating buyers are still in the market, hoping to find their dream homes.

Mortgage lenders are advertising terms too good to be true. A few days ago I heard a radio ad for no down payment home loans even for buyers with FICO scores as low as 600.

The major trend in home mortgages is interest-only loans. Some lenders call them "option" mortgages. The result is home buyers can pay rock-bottom fully tax-deductible all-interest monthly payments, or they can select partial or fully amortizing payments.

If you are the home seller, you don't care how the buyer finances the sale as long as the cash is green. Just be sure, when accepting a purchase offer, the buyer has a pre-approval letter or certificate for the necessary mortgage.

TODAY IS STILL AN EXCELLENT TIME TO SELL YOUR HOME. If you are motivated to sell your home, and are not just "testing" to see if you can get your outrageous grossly inflated dream price, this is a great time to sell. In most markets, there is a balanced inventory of homes listed for sale to meet buyer demand. Few markets have a glut of homes for sale without qualified buyers.

But before putting your home on market for sale, and interviewing prospective listing agents, it pays to get it ready to earn a top-dollar sales price. A fresh coat of exterior and interior paint, new light fixtures, fresh landscaping, new wall-to-wall carpets or hardwood floor refinishing, and a general cleaning are inexpensive ways to add thousands of value dollars and special appeal to home buyers.

Purely by accident, a few weeks ago I discovered another inexpensive value adder. It's called a "power washer." I was having my deck power washed to clean off the grime. Then the handyman asked if I would like my house power washed. How much? About $200 he said. I figured that was far cheaper than repainting so I gave the go-ahead.

After the job was finished and I realized my house didn't need repainting, my neighbor asked if I was getting ready to sell. I took that as a compliment although I have no plans to sell. That $200 house power wash saved me several thousand dollars, which I was planning on spending to repaint the exterior.

INTERVIEW THREE SUCCESSFUL REALTY AGENTS TO GET TOP DOLLAR. If you are serious about selling your home during this late peak sales season, after your home is fixed up in its best ready-to-sell condition, it's time to interview successful local realty agents about listing it for sale.

Even if you are thinking of selling alone without a professional agent, it pays to interview three successful agents to learn what is involved in the sales process.

The primary reason it pays to interview at least three realty agents is then you won't be misled by one who estimates a sales price too high or too low. Each agent interviewed should give you their written comparative market analysis (CMA).

This CMA form shows recent sales prices of comparable nearby homes, asking prices of neighborhood homes listed for sale (your competition), and asking prices of recently expired competitive listings (probably overpriced). In other words, the CMA is a mini-appraisal of your home's market value and probable sales price.

While you are separately interviewing the three or more agents, be sure to ask each agent what documentation is involved in your home sale.

In addition to the buyer's purchase offer, there will probably be a seller's defect disclosure form, lead-based paint disclosure and booklet for the buyer, professional inspection report, termite or pest control inspection report, and other forms such as radon inspection, building code compliance, energy efficiency, and possibly more depending on local ordinances and customs.

BE CAREFUL ABOUT SIGNING A LISTING AGREEMENT. Even if you think you can sell your home alone without a professional agent (known as a "for sale by owner" or FSBO), ask each agent you interview about his/her listing terms. Some might demand a long six-month exclusive right to sell listing. But others will recommend a 60-day or 90-day listing.

For most home sellers, the 90-day listing gives the listing agent plenty of time to market the home, but without tying up the seller for an unreasonable time just in case the buyer chose the wrong agent.

Even if you decide to try selling your home as a FSBO, the agents you interviewed won't mind. The reason is they know most FSBO sellers are unsuccessful and wind up listing their homes with one of the agents interviewed in 30 to 60 days.

When I visited Las Vegas a few weeks ago, in the newspaper real estate section I saw an ad by a local Realtor that said: "Selling your home FSBO? Call me and I'll help you." When I phoned him and identified myself as a real estate writer, he said that ad works so well to get listings from unsuccessful FSBOs he only runs it when he is short of listings.

SUMMARY: Most communities are still enjoying a peak sales season for homes, fueled by abnormally low mortgage interest rates and innovative mortgages from lenders eager to help home buyers.

To earn top dollar, after getting their homes into tip-top condition, motivated home sellers should interview at least three successful agents who sell nearby homes. Only by consulting at least three agents, and obtaining their CMAs, can home sellers be sure their asking price is correctly based on recent comparable sales prices.