What Risks Are There If I Sell My Home On My Own?

It can be tempting to try to sell your home by yourself, especially if you live in a market as lucrative as Charleston. People think it’s a cost efficient method and that the job is relatively easy. Perhaps you’ve heard a story about a friend of a friend who successfully sold their home in no time and saved tons of money? Frankly there are typically more to these stories than you are told. There are numerous downsides to attempting to sell your home without enlisting the help of professionals. Would you diagnose a major health condition without visiting the doctor? Hopefully not. The same goes for realty. Here are the top four reasons you should have a professional real estate agent help you to sell your beloved home.

 

Reason 1: It’s not easy to identify qualified buyers. As a homeowner, trying to sell without the help of a professional will leave you vulnerable. Investors may want to get a great deal by taking advantage of you and offering very low prices. Now you might think, I would never accept a low offer! That may be true, but can you also identify the  excited and qualified individuals who have fallen in love with your home and made offers versus those that simply cannot truly afford the end price and would not be fully approved for making such an offer? Probably not. You don’t want to make the mistake of wasting your precious time and energy on these individuals or even worse yet, accepting their offer. The only way to avoid this is by enlisting the help of professionals!

 

Reason 2: Getting the best price for your home is not easy without proper staging. Sellers who do not use professionals often have no idea of the importance of staging. Your home needs to be staged so it appears in tip top shape, with no random piles of laundry or dog toys hidden in the background of photos. This is also without mentioning that you need quality photographs in order to make your home look as appealing as possible to prospective buyers. With the help of a real estate agent, you’ll have the right lighting, the right staging, and most importantly you’ll get the right price.

 

Reason 3: Handling all the smaller details. Without the help of qualified professionals, individuals who chose to sell their home on their own often find themselves floundering at this stage of the process where things really begin. There is a lot of detailed tasks you must consider in order to handle financing correctly. This is not the time to cut corners!

 

Reason 4:  You’ll feel like you’re drowning in paperwork. When you’re selling your home the paperwork can seem never ending, let alone the fact that it is laden with legalities. A tiny mistake can not only cause you to start over, but it can cost you…big time. You could potentially find yourself losing out on thousands of dollars, simply because you are unfamiliar with the paperwork. This is the time when you need to seek the help of someone who does this professionally. Real estate agents often seek the help of lawyers in order to ensure this process goes as smoothly as possible because it is simply not worth the risk.

 

Why struggle just because it seems like you might save money? The negative side effects of selling your own home are plentiful and likely. Moving is stressful regardless, so why not minimize the stress by enlisting the help a professional and make it a smooth transition for your own peace of mind?

 

If you’re considering selling in Charleston, let’s talk today.

 

Selling Your House on Your Own Could Cost You

Selling Your House on Your Own Could Cost You | Simplifying The Market

In this extremely hot real estate market, some homeowners might consider selling their homes on their own which is known as a For Sale by Owner (FSBO). They rationalize that they don’t need a real estate agent and believe that they can save the fee for the services a real estate agent offers.

However, a study by Collateral Analytics reveals that FSBOs don’t actually save anything, and in some cases may be costing themselves more, by not listing with an agent.

In the study, they analyzed home sales in a variety of markets. The data showed that:

“FSBOs tend to sell for lower prices than comparable home sales, and in many cases below the average differential represented by the prevailing commission rate.” (emphasis added)

Why would FSBOs net less money than if they had used an agent?

The study makes several suggestions:

  • “There could be systematic bias on the buyer side as well. FSBO sales might attract more strategic buyers than MLS sales, particularly buyers who rationalize lower-priced bids with the logic that the seller is “saving” a traditional commission. Such buyers might specifically search for and target sellers who are not getting representational assistance from agents.” In other words, ‘bargain lookers’ might shop FSBOs more often.
  • “Experienced agents are experts at ‘staging’ homes for sale” which could bring more money for the home.
  • “Properties listed with a broker that is a member of the local MLS will be listed online with all other participating broker websites, marketing the home to a much larger buyer population. And those MLS properties generally offer compensation to agents who represent buyers, incentivizing them to show and sell the property and again potentially enlarging the buyer pool.” If more buyers see a home, the greater the chances are that there could be a bidding war for the property.

Conclusions from the study:

  1. FSBOs achieve prices significantly lower than those from similar properties sold by Realtors using the MLS.
  2. The data suggests the average price was near 6% lower for FSBO sales of similar properties.

Bottom Line

As Dave Ramsey, America’s trusted voice on money, explains:

“Research has shown that, between mistakes, lack of negotiating skills, pricing errors and general exposure on the market, you’ll cost yourself more than the real estate commission…You’ll come out slightly better and with a lot less hassle if you use a top-shelf agent.”

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Why Have Interest Rates Jumped to a 7-Year High?

Why Have Interest Rates Jumped to a 7-Year High? | Simplifying The Market

Interest rates for a 30-year fixed rate mortgage have climbed from 3.95% in the first week of January up to 4.61% last week, which marks a 7-year high according to Freddie Mac. The current pace of acceleration has been fueled by many factors.

Sam Khater, Freddie Mac’s Chief Economist, had this to say:

“Healthy consumer spending and higher commodity prices spooked bond markets and led to higher mortgage rates over the past week.

Not only are buyers facing higher borrowing costs, gas prices are currently at four-year highs just as we enter the important peak home sales season.”

But what do gas prices have to do with interest rates?

Investopedia explains the relationship like this:

“The price of oil and inflation are often seen as being connected in a cause-and-effect relationship. As oil prices move up or down, inflation follows in the same direction.”

You may have noticed that filling your gas tank has become substantially more expensive in recent months. The average national gas price has climbed nearly $0.50 from the beginning of the year, leading to the highest price for Memorial Day weekend since 2014.

As rates go up, your purchasing power goes down, but don’t worry; rates are still well below the averages we’ve seen over the last four decades.

“Freddie Mac said this year’s higher rates have not yet caused much of a ripple in the strong demand levels for buying a home seen in most markets, but inflationary pressures and the prospect of rates approaching 5 percent could begin to hit the psyche of some prospective buyers.”

Buying sooner rather than later will help lock in a lower rate than waiting, as the experts believe rates will continue to climb. Even a small increase in interest rates can have a big impact on your monthly housing cost.

Bottom Line

If you are planning on buying a home this year, keep an eye on gas prices the next time you’re at the pump. If you start to feel a big jump in price, know that rates are probably on their way up, too.

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How Current Interest Rates Can Have a High Impact on Your Purchasing Power

How Current Interest Rates Can Have a High Impact on Your Purchasing Power | Simplifying The Market

According to Freddie Mac’s latest Primary Mortgage Market Survey, interest rates for a 30-year fixed rate mortgage are currently at 4.61%, which is still near record lows in comparison to recent history!

The interest rate you secure when buying a home not only greatly impacts your monthly housing costs, but also impacts your purchasing power.

Purchasing power, simply put, is the amount of home you can afford to buy for the budget you have available to spend. As rates increase, the price of the house you can afford to buy will decrease if you plan to stay within a certain monthly housing budget.

The chart below shows the impact that rising interest rates would have if you planned to purchase a home within the national median price range while keeping your principal and interest payments between $1,850-$1,900 a month.

How Current Interest Rates Can Have a High Impact on Your Purchasing Power | Simplifying The Market

With each quarter of a percent increase in interest rate, the value of the home you can afford decreases by 2.5% (in this example, $10,000). Experts predict that mortgage rates will be closer to 5% by this time next year.

Act now to get the most house for your hard-earned money.

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Don’t Wait to Sell Your House! Buyers Are Out Now

Don’t Wait to Sell Your House! Buyers Are Out Now | Simplifying The Market

Recently released data from the National Association of Realtors (NAR) suggests that now is a great time to sell your home. The concept of ‘supply & demand’ reveals that the best price for an item is realized when the supply of that item is low and the demand for that item is high.

Let’s see how this applies to the current residential real estate market.

SUPPLY

It is no secret that the supply of homes for sale has been far below the number needed to sustain a normal market for over a year at this point. A normal market requires six months of housing inventory to meet the demand. The latest report from NAR revealed that there is currently only a 3.6-month supply of houses on the market.

Supply is currently very low!

DEMAND

A report that was just released tells us that demand is very strong. The most recent Foot Traffic Report (which sheds light on the number of buyers who are actually out looking at homes) disclosed that “foot traffic grew 10.5 points to 52.4 in March as the new season approaches.”

Demand is currently very high!

Bottom Line

Waiting to sell will only increase the competition between you and all of the other sellers putting their houses on the market later this summer. If you are debating whether or not to list your home, let’s get together to discuss the conditions in our market.

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Where Are The Best Places To Take My Guests In Charleston?

Options are many when it comes to showing your friends and family the sights and sounds of Charleston. Within a mere 15 minutes, you can go from beach to city to country. The Holy City is steeped in early American history, has an impressive arts, culture and nature scenes, and there’s no end of fun and fine places to eat!

 

Get Outdoors

Sullivan’s Island sits on the coast of Mount Pleasant and is an outstanding place to entertain your guests and show Charleston off to family and friends. Its small size belies all there is to do. Walking along the beach collecting shells, photography and kiteboarding are but a few of the activities you will find here. Your guests may also enjoy exploring Fort Moultrie, where early American soldiers gave the state it’s namesake by defending the shores amongst  a base fortified by palmetto trees (which was a soft wood that reflected cannonballs fired by the British, instead of absorbing them). One of the only air conditioned buildings made during WW2 exists here as well, for that special history buff amongst your group.

 

From Sullivan’s Island, you can roll across the Ravenel Bridge to explore King Street downtown, one of the oldest streets in the U.S. Here you’ll find unique shops and the restaurants that define southern food and hospitality. Coleslaw, fried chicken, burgers, deep fried fish, biscuits, grits; you will find it all nearby.

 

Head to Market Street on the weekends and you’ll see what local artisans produce, along with more great food from the soul and Lowcountry traditions. If you’re lucky, you may get to see Second Sunday! This is when King Street gets blocked off from Calhoun to Market Streets and pedestrians flood the streets to check out local shops or get great eats out on King Street!

 

If you want go ahead and make your way to Waterfront Park; one of Charleston’s most visited sites, especially in the summer. It boasts a pineapple-shaped fountain that children find irresistible, as well as there are dedicated gardens and sweeping views of the water and Charleston Harbor.

 

Beyond food, you can take your visitors on haunted house tours (a real kid pleaser, whether it’s the Old City Jail or the Provost Exchange), or make a visit to actual plantations like McLeod Plantation Historic Site or Boone Hall Plantation (which is still a working plantation). Middleton Place is an early rice plantation that also has one of the first private gardens in the country.

 

Charleston Navy Base and Naval Shipyard became the North Charleston Riverfront Park in 1996. This park is now open year-round as well. It has sheltered picnic areas, cooling fountains for children during the summer and sits on the Cooper River.

 

For Less Than Perfect Weather

You can explore the past even deeper by visiting the Gullah Geechee Corridor, which runs from Jacksonville, FL to Wilmington, NC. The National Park Service recognizes this corridor and the communities along it celebrate the gullah geechee in organized festivals throughout the year.

 

If you don’t want to stray far from home, check out Charleston’s Museum Mile. The mile includes four parks, six museums, five historic homes and the historic city hall and market. You’ll find a wide range of Charleston history at The Charleston Museum, including civilian and military.

 

Just because these are museums doesn’t mean that your children will be bored. Be sure to visit the Children’s Museum of the Low Country and let them play on a pirate ship, explore the medieval castle and spend time inside an art room!

 

The Spoleto Festival USA is an internationally known arts festival that starts around Memorial Day and runs for the first two weeks in June. Numerous opera, music, dance and theater performances are held at various venues throughout the area during this event.

 

If you still want to lounge around on a lazy day, considering gathering your group to go to the Cinebarre theater in Mount Pleasant. This theater distinguishes itself by offering casual eating, light alcoholic beverages and big-screen movie watching simultaneously. Furthermore, anyone under 18 must be accompanied by an adult; so you wont find yourself being bugged by pesky teenagers!

 

If you’re finding yourself in love with Charleston, let’s talk about whats available today!

Moving Up to Your Dream Home? Don’t Wait!

Moving Up to Your Dream Home? Don’t Wait! | Simplifying The Market

Mortgage interest rates have risen by more than half of a point since the beginning of the year, and many assume that if mortgage rates rise, home values will fall. History, however, has shown this not to be true.

Where are home values today compared to the beginning of the year?

While rates have been rising, so have home values. Here are the most recent monthly price increases reported in the Home Price Insights Report from CoreLogic:

  • January: Prices were up 0.5% over the month before.
  • February: Prices were up 1% over the month before.
  • March: Prices were up 1.4% over the month before.

Not only did prices continue to appreciate, the level of appreciation accelerated over the first quarter. CoreLogic believes that home prices will increase by 5.2% over the next twelve months.

How can prices rise while mortgage rates increase?

Freddie Mac explained in a recent Insight Report:

“In the current housing market, the driving force behind the increase in prices is a low supply of both new and existing homes combined with historically low rates. As mortgage rates increase, the demand for home purchases will likely remain strong relative to the constrained supply and continue to put upward pressure on home prices.”

Bottom Line

If you are thinking about moving up to your dream home, waiting until later this year and hoping for prices to fall may not be a good strategy.

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Renters Under 50 Want to Buy a Home!

Renters Under 50 Want to Buy a Home! | Simplifying The Market

Every year, the New York Federal Reserve publishes the results of their Survey of Consumer Expectations (SCE). Each survey covers a wide range of topics including inflation, labor market, household finance, credit access and housing.

One of the many questions asked in the housing section of the survey was:

Assuming you had the financial resources to do so, would you like to OWN instead of RENT your primary residence?

Over three-quarters of respondents under the age of 50 said that they would prefer to own their home, rather than rent. While only 52.6% of those over 50 would prefer to own. The full breakdown can be found in the chart below.

Renters Under 50 Want to Buy a Home! | Simplifying The Market

When renters were asked what the average probability of owning a primary residence at some point in their future was, 66.4% of those under 50 believed that they would eventually own their home, while only 23% of those over 50 did.

Renters Under 50 Want to Buy a Home! | Simplifying The Market

Bottom Line

Many had wondered if young Americans had lost their desire to own a home, but for those renting now, that dream is still alive.

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