Reality Check on Your Home Before You Sell?

Here You Go, We get it—you spent years turning your house 

into a cozy home. And everything from that perfect shade of gingham blue you painted the cabinets to the quirky old chair rail you preserved makes your home priceless, at least to you.

Still, when it comes time to sell your house, you need to take off those rose-tinted glasses and regard your house as a buyer would. Without this shift of perspective, you run the risk of overpricing your home, or failing to make necessary renovations or repairs—all of which means your place could end up sitting on the market. For a long time.

Interview real estate agents

Sit down with a few real estate agents as you get ready to list your home. Not only will you get a sense for whom you want to work with, but you can also ask them for suggestions on how you should prep your home for sale. Should you repaint that purple office? Clear out the clutter in those hall closets? Remember, no one has better insight into what homes sell for and why than a real estate agent.

Hire a home inspector

It also helps to hire a home inspector for a pre-inspection, Besides dispensing a metaphoric wake-up call, an inspector will usually find problems with your home that you didn't even know existed.
Plus, you'll have to go through the inspection process at some point of a sale, and being proactive could save you some dough.
'When home buyers discover through an inspector that a home needs a $5,000 repair, they will ask for $7,000 off the purchase price,' But if you got that issue repaired ahead of time—and without it being a rush—it'd cost more like $4,000, meaning your net will be higher at closing.'

Consult with a home stager

To get a fresh perspective, hire a home stager to provide professional feedback on how your home currently presents itself and what suggestions would make it more marketable.

Visit open houses in your area

'Sellers don't learn,' says Ian Slater, a licensed real estate salesperson with Compass, in New York City. 'They sit inside their homes with an idea of its value and don't understand what the buyer pool is actually seeing.'

Do a walk-through with someone in your target market

So instead of inviting your mom or your friends to do a walk-through, ask your friend's niece who just graduated from business school or the young family at your church if they'd be willing to give you an honest assessment.

'Besides, it's easier to absorb critical feedback from people you don't know as well, and you won't hold a grudge against your mother-in-law,' 

Take pictures and post them to social media

A seller needs to realize that only 10% of buyers can see beyond what is presented, And what's presented to buyers on a listing site such as realtor.com® is all about the visuals. So to see just how your home comes off, snap pictures of your various rooms. View your photos and honestly ask yourself if a buyer would find the rooms bright, attractive, and updated.

Then post those pictures on Facebook and Instagram to get multiple opinions from a large pool of friends. Your home's appeal may become evident in the amount of likes—or lack thereof—you get.

Are you ready to Sell? Precision Realty LLC will research sale prices on other Comparable Homes in your neighborhood to help you set your sale price.  It’s important to get the price right the first time.

Pros and Cons of a Homeowners Association

Every Buyer Should Consider, Home shoppers weigh a laundry list of 

factors before purchasing a single-family home or condo. Location, price, size, and style are all taken into consideration. But for some, a home in a community with a homeowners association, or HOA—a board of residents who help ensure that your community looks its best and functions smoothly—could either sweeten the pot or be a major deal breaker.

Pro: HOAs maintain the common areas

Your community's HOA will be responsible for handling all maintenance of common areas and repairs for the amenities outside of your home. It's perhaps the biggest perk of living in an HOA community.

Con: You have to pay recurring HOA fees

If you move into an area with an HOA, membership is mandatory and so are the monthly or annual fees. So, how much can homeowners expect to pay? It varies depending on your location and how expensive your house is.

The listing agent will be able to tell you exactly how much HOA payments will be.

Pro: HOAs help keep uniformity

Each HOA has its own declaration of covenants, conditions, and restrictions, or CC&Rs, which explain what homeowners can and cannot do—this includes streamlining the appearance of each property.

“Your neighbors can't paint their house bright purple or put an unsightly addition on the front of their house,” Golden says. The CC&Rs make sure 'the community retains the look and feel of the way it was built.”

Other common no-nos are parking vehicles on the lawn or keeping inoperable vehicles in the driveway.

“You won’t have to worry about that one neighbor that has decided to let his front yard grow into a wild jungle,” says Golden.

“Ultimately, the HOA helps the homes within the neighborhood retain their value,” Garrett says. 'When there are rules and guidelines governing how homeowners should keep their property's appearance, it helps keep the neighborhood looking desirable for the consumers perusing the neighborhood in search of a new home.”

Con: There's a lot of red tape

Building that new second-floor addition will be especially difficult in an HOA community. Why?

Any exterior modification—even a minor one like a play area for your kids—has to be approved by the HOA.

You must submit plans describing the height, colors, location, shape, and materials to the HOA board for approval. 'This can really slow down the process or limit the type of work you can do,” Scott says.

Pro: HOAs mediate problems on your behalf

An HOA can also reduce conflicts and unpleasant exchanges. If your neighbors haven’t cut their lawn in several weeks, or decide to turn their driveway into an auto repair shop, you don't have to confront them because the HOA will. When anyone is engaged in activity that violates the CC&Rs, the HOA sends a friendly notice and follows up with a stern warning.

Con: They can be overbearing

Remember those CC&Rs? While they come in handy for preventing rowdy college students from moving in, they also might be off-putting for homeowners who like their autonomy.

“Many folks believe that buying your own home should give you the freedom to make the changes you want to make and express your own individuality,” Golden explains. “They don't want decisions about their own home made by a committee.”

HOA-mandated restrictions can be set on swimming pools (e.g., in-ground swimming pools can be built in the back of the house, but above-ground pools are prohibited), pets (e.g., they're are allowed, but they can’t be bred or kept for commercial reasons; livestock or poultry are not allowed without permission), and rentals (e.g., you might be prohibited from renting out rooms or the entire home). 

In extreme situations, some HOAs can evict the tenant and hold the homeowner responsible for any eviction costs or any damage caused by the tenant

How Big a Home Do You Truly Need?

Ask these 5 Questions to help you Figure That Out.

When it comes to homes, the popular credo is that bigger is better. More square feet = a larger slice of the American dream, right?

Not necessarily. For one, bigger homes obviously cost more, and oversized McMansions can be harder to sell. As such, you'll want a home that's neither too big nor too small. But how do you strike that balance?

1. Is this my ‘forever’ home, or is ‘right now’ good enough?

While you can’t predict the future (darn those unreliable crystal balls), it is possible to evaluate the likelihood you might be moving in coming years. If so, then maybe you don't need to buy that perfect 'forever home' where you'll grow old; maybe a 'right now' home is good enough.

“There's a common perception that you should be searching for your ‘forever home,’ and that pressure to find a place that has all the space you might ever need often leads buyers to purchase a home that might be too big.”  'It's OK to know that you'll only live in a home for the next five or six years, and to buy a home that will serve your needs during that period. You can always re-evaluate and upgrade to a bigger space later.”

2. What will my income look like later?

If you’re early in your career, odds are decent that your income will increase over the years. Or, if you’re reaching the end of your career, you may be looking at flattened or declining income. In either case, it's never a good idea to get a mortgage at the max of what you can afford; it's better to go small and have some wiggle room.

“Nothing causes more stress than financial strain,”  “A mortgage on a home that is a size too large is most likely to be your biggest burden, and a hard one to overcome. Happiness is often one size smaller than your dream home. That way, you can enjoy your home without dreading your monthly mortgage payment.”

Also, remember more space means more time and money spent on upkeep and maintenance, more rooms to fill with furniture, and higher utility bills to heat and cool the home.

'Any future improvement projects, like installing new floors or replacing windows, will cost more when the space is bigger,' says Hinton. 

3. What are my priorities?

Another question to consider is what you'll use all that space for—and be honest: While you might dream of hosting epic dinner parties in that big formal dining room, will you really? Can you say with certainty that your in-laws will descend on you during the holidays and need a guest bedroom to crash in, or might they be just as comfortable in a nearby Airbnb?

Aside from justifying what you'll use each space for, ask yourself what you're giving up. If you dream of having a secret 'travel fund' so you can see the world, that may be possible only with a smaller mortgage (and house). Or, perhaps you value things other than space, like school district or a walkable location. So make sure to factor in those variables, too—and make sure you aren't sacrificing them for space you don't need.

This is why Kathy Fettke decided to buy a smaller home so she could live in her 'dream location' near the beach. 'Being open to a smaller home allowed us to be in a higher-priced market we wouldn't have been easily able to afford otherwise,' she says. And best of all, her home doesn't feel cramped—particularly since she can pop out and stroll along the ocean anytime.

4. How much space do I want from my own family members?

If you absolutely must have privacy—to, say, get work done in a home office or chill out in your man cave—then that extra square footage may be well worth the money. But if you're more the type who loves having their family members nearby, a large home gives people plenty of alone time ... sometimes too much.

Fettke, for one, is glad her home is small because it keeps her in close contact with her kids. 'I've found that my daughter’s friends who live in large homes rarely even run into their parents,' she says. But since her own home is smaller, her kids are constantly underfoot—just the way she likes it.

'Plus it seems that most of our daughter's friends hang out at our place, even though it's tiny,' she says. Sure, the beach nearby may be one draw, but so may be the cozy, close-knit family environment a smaller home forces you to have. 'Maybe they like the homey environment and being able to smell the cookies being baked around the corner,' she says.

5. Does this home feel spacious even if it doesn't have much space?

Keep in mind that even small homes can feel spacious purely based on an open floor plan and lots of light. Meanwhile, large homes can still feel cramped if they're dark or poorly laid out. So, when shopping real estate listings, know that the little number next to square footage may not tell the whole story.

'The total square footage of a house can be deceiving.'  'Features like a long hallway may increase the total, but they are spaces you pass through, not a true destination within the home.”

So instead of homing in on total square footage, “buyers should focus on the size of individual rooms where they see themselves spending the majority of their time,' says Ryan. In other words: Who cares if your bedroom isn't massive, since all you plan to do there is ?

Most Markets Near Peak;

No Signs of Bubble, Home prices in most U.S. housing markets are 

reaching their peak, but there’s no need to fear a repeat housing bust, according to a new joint analysis by Florida Atlantic University and Florida International University. Throughout the majority of the country, home prices have been rising steadily since 2012, and there are signs the runup may be starting to slow.

“Housing markets are slowing, suggesting that we are nearing a peak in housing markets around the U.S.,” says Ken Johnson, a real estate economist at Florida Atlantic University. “But this is good news, as we are pulling back from the brink, unlike we did in 2007.” 

Mortgage Rates Push Higher

Home buyers who are concerned about rising rates may want to lock in with a lender, which guarantees the current rate for a set period of time. Still, don’t let your clients linger on making a decision. It typically costs several hundred dollars to lock in a rate.

 Researchers at the universities created the Beracha, Hardin & Johnson Buy vs. Rent Index, which shows that out of 23 metros areas studied, 13 are slightly to moderately in “buy” territory. That means owning a home is more favorable than renting for the majority of residents in that area. On the other hand, 10 metro areas were slightly to moderately in “rent” territory.

“Our data indicates that prices are above their 40-year trend but not significantly so, as they were in 2007,” says Eli Beracha, co-creator of the index and associate professor in the Hollo School of Real Estate at FIU.

“Rather than a crash, I anticipate slower growth in prices accompanied by longer marketing times for sellers and increasing inventories, which should bring prices back in conjunction with their 40-year trend.”

Where Homes Are Flying Off the Market

Ready? Get set? Let's first go look at those boiling-hot metros where homes spendthe least time on market.

Why do home buyers and sellers alike track days-on-market stats every bit as obsessively as money managers fixate on the Dow, baseball fans on weight-on-base averages, or 'Bachelor' fans on ambush breakups? Well, it all depends on which side of the sales aisle you're on. 

Sellers, of course, want their homes to move to closing as quickly as possible, maybe even spurring a sweet price war en route. Buyers, on the other hand, are eager to avoid said price wars and maybe even have a bunch of different homes to choose from.

But contrary to what you might assume from reading real estate news headlines,there are metro areas where homes aren't being snapped up at a breakneck pace.It's a big country, after all. So we got curious. What could we learn from how long homes spend on the market in different metros?

The realtor.com® team of data wizards set out to learn where 'For Sale' signs are coming down about as quickly as Tickle Me Elmo toys flew off the shelves circa 1996—and where abodes are taking the longest to sell. It turns out, those two opposing lists portray clashing versions of America's real estate market today.

3. Salt Lake City, UT
Median days on market: 38.2
Median list price: $372,450
Salt Lake City homes
People are flocking to Utah, particularly Salt Lake City, like luna moths to flame.

That’s probably because the economy is booming with one of the lowest unemployment rates in the U.S., ringing in at just 2.7% in December 2017, according to the U.S. Bureau of Labor Statistics. That's leading to plenty of transplants. The city is expected to gain an additional 600,000 residents over the next 50 years, according to a University of Utah research brief.

Pair that with a relatively low cost of living, compared with some of the other cities on our list, a great public transportation system, and nearby ski slopes, and you have yourself a great big shortage of homes for sale.

“Anything under $350,000 is selling pretty easily,”  She listed one home just outside the city limits for about $285,000. Within a few days, she had three offers at $300,000. “We have zero days on market with some places—no sign even goes out because it's already gone.”

Buyers and sellers, take note(s)!
“That info can give home buyers an idea of how much competition they face, how limited homes are in the market, and how quickly they need to make a decision if they find a home they like,” says Chief Economist Danielle Hale of realtor.com.
And sellers can get a reality check about how long their home should spend on the market—if it's priced right and in good condition.

'It helps them get an idea of how long they have to move somewhere else,” Hale says. “In a really hot market, you can probably sell your home without making updates. But if you make updates, your home is more competitive.”

Nationally, the median number of days on the market is falling—there are too many buyers and not enough properties for sale, particularly in booming tech hubs. It hit a low of 60 days in the high-home-buying season of both May and June 2017, according to realtor.com data. That's down from 89 days in June 2012. (Our data go back only to May 2012.)

To figure out where these home-buying headaches are the worst (or are relatively painless), we looked at the median number of days that for-sale homes in the 300 largest metros spent on market from February 2017 through January 2018.* We limited our rankings to just one metro per state to ensure some geographic diversity.

Where They're Lingering Longest
Rounding out the metros with the fewest median days on the market are Portland, OR (44.3); Boise, ID (46); Sioux Falls, SD (46.8); Omaha, NE (47.2); and Minneapolis (47.3).

Need to slow down a bit? Let's take a look at the other end of the market, where homes are taking the longest to sell.
Take your time: Where homes sit on the market the longest

5 Sweet Tax Deductions When Selling a Home

Did You Take Them All? Are there tax deductions 

when selling a home? You bet—and they can amount to sizable savings when you file with the IRS. So whether you're selling your home soon or sold it last year, you'll want to know all the tax deductions (not to mention tax exemptions or other write-offs) at your disposal.

Here's a rundown of everything you need to know, plus a preview of what's in store once the new tax code takes effect next year.

1. Selling costs

“You can deduct any costs associated with selling the home—including legal fees, escrow fees, advertising costs, and real estate agent commissions,” says Joshua Zimmelman, president of Westwood Tax and Consulting in Rockville Center, NY.

This could also include home staging fees, according to Thomas J. Williams, a tax accountant who operates Your Small Biz Accountant in Kissimmee, FL.

2018 tax changes: These deductions are still allowed under the new tax law.

2. Home improvements and repairs

Did you renovate a few rooms to make your home more marketable? Super—they probably helped you fetch a higher sales price, and now you can deduct those upgrade costs as well. This includes painting the house, repairing the roof or water heater, or anything that remains useful past a year.

But there’s a catch, and it all boils down to timing.
“If you needed to make home improvements in order to sell your home, you can deduct those expenses as selling costs as long as they were made within 90 days of the closing,” says Zimmelman.

2018 tax changes: None.

3. Property taxes

If you were dutifully paying your property taxes up to the point when you sold your home, you can deduct the amount you paid in property taxes for the time you owned it.

2018 tax changes: This deduction is still allowed, but your total deductions are capped at $10,000, Zimmelman says. You may be able to avoid this cap if you prepaid your 2018 taxes and if your property was assessed  in 2017, but estimated assessments won’t qualify.

4. Mortgage interest

As with property taxes, you can deduct the interest on your mortgage (up to a maximum of $1 million) for the portion of the year you owned your home.

2018 tax changes: New homeowners (and sellers) can deduct the interest on up to only $750,000 of mortgage debt, though homeowners who got their mortgage before Dec. 15, 2017, can continue deducting up to the original $1 million amount, according to Zimmelman.

5. Moving expenses

If you sold your home in 2017 in order to move for a job change, you can deduct those expenses.

2018 tax changes: Lawmakers eliminated this deduction for most of us. However, members of the armed forces on active duty can still take the deduction.

But what's up with capital gains tax for sellers?

This one isn’t technically a deduction (it's an exclusion), but you’re still going to like it. As a reminder, capital gains are your profits from selling your home—whatever cash is left after paying off your expenses, plus any outstanding mortgage debt. And yes, these profits are taxed as income. But here's the good news: You can exclude up to $250,000 of the capital gains from the sale if you’re single, and $500,000 if married. The only big catch is you must have lived in your home at least two of the past five years.

2018 tax changes: None. Lawmakers tried to change this rule, but it managed to survive—so it’s still one home sellers can cherish. However, look for this to possibly change in a future tax bill.

Ralph DiBugnara, president of Home Qualified and vice president at Residential Home Funding, says lawmakers would like to change this so that homeowners would have to live in the property for five of the past eight years, instead of two out of five.
source: Realtor.com

Your Buying Power Just Increased

For the first time in five years, the Federal Housing Finance Agency (FHFA)

significantly increased the maximum conforming loan limits to $453,100 — up from 2017's maximum of $424,100.  It's a change that just may help you reach your goal to buy a home.

The loan limit increases will help all buyers save money when getting a mortgage, especially those in high–cost areas, because a conforming mortgage generally has lower down payment requirements and offers a lower mortgage rate than a jumbo loan. Bottom line: you have more buying power in 2018.

And if you live in an area where a typical one–unit home costs more than the new loan limit, don't worry. Qualified borrowers who live high–cost areas can borrow more than $453,100.

This map shows the 2018 maximum loan limits across the U.S., including the counties where the loan limit ranges are higher. In Boulder County, CO, for example, the limit is $578,450. In Salt Lake City Utah, the limit is $600,300. Loan limits can be even higher in some areas.

House prices increased 6.8% on average between 2016 and 2017, according to FHFA. Raising the conforming loan limits helps keep housing affordable.

Freddie Mac and Fannie Mae can purchase single–family mortgages with loans up to the conforming loan limit. Loans above this limit are known as jumbo loans and generally have higher costs associated with them.

If you're in the market to buy a home, consider answering these five questions to determine if you're mortgage ready.

Are you ready for homeownership? The decision to rent or buy is a personal one that depends on your financial situation, future plans and lifestyle. Buying may make sense if you plan to stay in your home for at least five to seven years and you’re interested in building long-term equity. And if you prefer a more personal touch, reach out to a Precision Realty & Assoc. LLC CALL 801-809-9866 today.