Spring will bring a warmer home-buying and selling season
April 25, 2014
By Vincent Rosanova
The preparations made by homeowners to put their homes on the market are initiated with a clear objective in mind. That is, to garner the highest possible price the home will bring based on location, living space, quality of construction and design.
The spring/summer of 2014 could be the first time since the Great Recession of 2007-2008 that home sellers can truly be optimistic about getting an acceptably good price for their homes within a reasonable period of time. What makes this possible is the fact that mortgage interest rates remain very low, and home values have recovered considerably and have been seen to sustain positive growth for the long term.
According to the Jann Swanson article, “Fannie survey hints at warmer spring for housing,” published on the Mortgage News Daily website, Fannie Mae’s “most recent National Housing Survey” indicates that home buying and selling activity will pick up substantially this spring. It also says expectations for continued increases in home prices over the next 12 months have been high (45 percent to 50 percent of respondents over the past year shares this opinion) and remain so today, according to the survey.
With this in mind, it is necessary for home sellers to present their homes to prospective buyers in the very best aesthetically appealing condition possible. Begin with exterior curb appeal, since this is the initial impression for interested buyers. It is important that the lawn be mowed and well-trimmed; the backyard be raked free of twigs, leaves and dried-up vines; driveways, sidewalks and other paved areas and painted surfaces should be thoroughly cleansed of the effects of previous harsh weather; and the windows should be polished to a sparkling shine.
What to know
A homeowner’s goal is to do everything possible to distinguish his or her home from all other competing properties on the market. It is common knowledge that a potential homebuyer might view up to 15 homes, or more, if he or she does not find one that is suitable. But homebuyers have also been known to decide on the first home they see because of a positive impression made upon them at first viewing.
So, every seller’s objective — especially during this more active peak selling season is to present a home that makes that kind of “I’m-irresistible-buy-me-now” impression on a homebuyer as those choice properties will usually fetch the higher end of the price range. Often, a staging specialist can inexpensively be utilized to de-clutter and maximize the look of your home if a quick and inexpensive makeover is in order.
Equally important are the preparations made by homebuyers in this competitive lower inventory market, which are based upon presenting yourself as a buyer that can without question close while also securing the very best financing fit for their home purchase as they can achieve. Perhaps nearly as important as the price the homebuyer ultimately pays for a home of his or her choice is the loan type and interest rate he or she obtains to finance a new home.
Buyer preparations should also include gathering the requisite income, asset and credit documents for availability to their mortgage lender. Any cleaning up a prospective homebuyer engages in will probably pertain to credit issues.
A meeting with a mortgage professional to discuss financing should be an early priority for prospective buyers as almost 40 percent of sales in the past year have been all cash. Those buyers are your competitors.
This is not to say that homebuyers do not have other preparatory work to do, as they should research market values, neighborhoods, school districts and amenities, along with possibly other professional services, including those of a buyer’s broker who will represent your interests during the process.
So, yes, both buyer and seller must prepare equally well in a market that is expected to be the most active in many years. It is likely that home sellers, as well as home buyers, will have far more to do this season than in the recent past as a result of the stiff competition they face with inventories lower than normal and lending standards continuing to remain conservative.
Vincent M. Rosanova is president of the Redmond Mortgage Corp. and Front Street Mortgage. Reach him at 868-9255 or firstname.lastname@example.org.