Our Client’s Satisfaction Is Our Satisfaction

In sellers’ markets, increasing demand for homes drives up prices. Here are some of the drivers of demand: Economic factors – the local labor market heats up, bringing an inflow of new residents and pushing up home prices before more inventory can be built. Interest rates trending downward – improves home affordability, creating more buyer interest, particularly for first time home buyers who can afford bigger homes as the cost of money goes lower. A short-term spike in interest rates - may compel “on the fence” buyers to make a purchase if they believe the upward trend will continue. Buyers want to make a move before their purchasing power (the amount they can borrow) gets eroded. Low inventory - fewer homes on the market because of a lack of new construction. Prices for existing homes may go up because there are fewer units available.

A buyer’s market is characterized by declining home prices and reduced demand. Several factors may affect long-term and short-term buyer demand, like: Economic disruption - a big employer shuts down operations, laying off their workforce. Interest rates trending higher – the amount of money the people can borrow to buy a home is reduced because the cost of money is higher, thus reducing the total number of potential buyers in the market. Home prices drop to meet the level of demand and buyers find better deals. Short-term drop in interest rates – can give borrowers a temporary edge with more purchasing power before home prices can react to the recent interest rate changes. High inventory – a new subdivision and can create downward pressure on prices of older homes nearby, particularly if they lack highly desirable features (modern appliances, etc.) Natural disasters - a recent earthquake or flooding can tank property values in the neighborhood where those disruptions occurred.

A stratified market happens where supply and demand characteristics differ by price point, in the same area (typically by city). For example, home sales for properties above $1.5M may be brisk (seller’s market) while homes under $750k may be sluggish (buyer’s market). This scenario comes along every so often in West Coast cities where international investors - looking to park their money in the United States - buy expensive real estate. At the same time, home sales activity in mid-priced homes could be entirely different.

First impressions matter in business, but especially in real estate. Anyone walking through a house or touring it virtually will be looking for ways to pass or negotiate down on the price. You must help clients make sure that the HVAC, plumbing, and electrical system all work properly. Each room should look clean and decluttered with no overt damage insight.

Getting a pre-sale home inspected is never a bad idea, especially to get your client the best price for their home. Some homebuyers will feel uncomfortable purchasing a house without seeing a home inspection. Many will often hire their own inspector. It’s better to be safe than sorry.

Once the house is on the market, it may take anywhere from four to six weeks to sell. However, if the market is fairly hot, a seller could see their house off the market within a week. On the flip side, if there is a lull in the market or issues arise such as negotiation, lack of exposure, or house conditions then the property can sit on the market for months.

The selling price of a house fluctuates depending on multiple factors. The most common ones are the neighborhood and what similar-sized houses are currently selling for. Also, look at the age and condition. Do major repairs need to be done? If so, that might lower the property. And again, the market matters. Like everything else, home prices vary depending on supply and demand. Your job as a realtor is to best inform your clients about these different factors and accurately list their house.

A public tax assessor gives the assessed value for a property. This assessment typically occurs yearly for taxation purposes. The fair market value is an agreed-upon price between a willing buyer and seller. There is usually a difference between the assessed value and market value. For homeowners, the assessed value is a double-edged sword. Because, if their annual assessed value increased then their yearly taxes will also be raised. On the flip side, when selling a house it can help boost its market value.

In a real estate transaction, the agent is usually paid by the seller via commission as opposed to a flat free. Typically, a real estate commission fee is 5–6% of the home’s final sale price. In many cases, both the buyer’s agent and the seller’s agent split the commission fee 50/50. Both receiving 2.5–3%. As a broker or agent, you can use this easy to use real estate commission calculator to determine your commission fee. Also, know that some real estate agencies will work at a discounted rate of around 3% or for a flat service fee. The discounted rate and flat fee can be cheaper, but can also result in a lower quality of service.

Yes, almost everything in real estate is negotiable. Typically, there is a difference between a home’s list price and how much it actually sells for. The current market’s saturation will determine how much wiggle room there is for negotiation. If you’re on the buyer’s side, expect the house to be able to be purchased for less if there is a lower demand than supply in the market. Vice versa, if you’re on the seller’s side expect it to usually sell for less. That being said, you never know who else is house hunting. Sometimes people will swoop in and offer the exact asking price. ‍

The absolute first step for your client is to get approved for a mortgage. Without being approved for a mortgage it will be quite difficult, if not impossible, to purchase a new home. If a potential client reaches out to you, have them go through the tenant screening process and then guide them to a reputable mortgage corporation and advisor that you trust.

This is a tricky question, and the answer primarily depends on one’s funds and ability to find temporary housing. If a client needs more equity to purchase a new home or meet a mortgage plan, then it is best to sell one’s current home before purchasing their next one. That being said, they will most likely need temporary housing at a friend or relatives, or by arranging a short-term rental elsewhere.

Yes, either order a home inspection for your client or have them order one. A home inspection is one of the most vital steps when purchasing a property. A professional inspector has a keen eye for how well the house has been taken care of. The inspectors can comment on structural and cosmetic issues, along with any local code issues. Moreover, a home inspector will help you better determine the home’s value.

A final walk-through is not required but highly recommended. Final walk-throughs give buyers a chance to make sure nothing has changed since their initial inspection or previous visits. Also, if repairs were requested as part of the sale offer then a follow-up visit ensures all repairs are done according to the agreement and contract.

Earnest money is similar to a deposit when renting a place. It is made in good faith to demonstrate to the seller that the buyer’s offer is legitimate. As a real estate agent, you should ask your client for the earnest money as a deposit in the form of a check or cash. The amount is usually 1-2% of the selling price and essentially takes the property off the market. The money also gives the buyer extra time to conduct a title search, get an inspection and property appraisal, and financing.

The number of houses your client wants to view can depend greatly. However, it is much easier today to connect with your clients virtually. You can now see houses online by taking virtual tours or seeing detailed photographs. So, you can help your client by giving them access to your online systems so that they can view as many properties as they desire. Once a list is narrowed down, you can visit properties with them or on their behalf.

If your client gets cold feet about a property that is okay. Sometimes, they have second thoughts or want to go in a different direction. Know that your client will have to forfeit the earnest money, which again, is around 1–2% of the home’s sale price.

A mortgage is a type of loan to finance a property. The majority of people are not wealthy enough to purchase a house in total. Thus, a mortgage serves as a secure loan that comes with a fixed interest rate and gets paid off over 15 or 30 years. If need be, your client can refinance their mortgage and payments in the future.

An escrow is a term that refers to a neutral third party hired to handle the exchange of money, property transaction, and related documents. The escrow holds the money and documents in a trust until all terms and conditions of the sale are satisfied. When depositing the earnest money, it is wise to use an escrow account. ‍

Home buyers pay little or no fees to an agent to buy a home. Here’s why: For most home sales, there are two real estate agents involved in the deal: one that represents the seller and another who represents the buyer. Listing brokers represent sellers and charge a fee to represent them and market the property. Marketing may include advertising expenses such as radio spots, print ads, television and internet ads. The property will also be placed in the local multiple listing service (MLS), where other agents in the area (and nationally) will be able to search and find the home for sale. Agents who represent buyers (a.k.a. buyer’s agent) are compensated by the listing broker for bringing home buyers to the table. When the home is sold, the listing broker splits the listing fee with the buyer’s agent. Thus, buyers don’t pay their agents.

The national average for down payments is 11%. But that figure includes first time and repeat buyers. Let’s take a closer look. While the broad down payment average is 11%, first time homebuyers usually only put down 3 to 5% on a home. That’s because several first-time home buyer programs don’t require big down payments. A longtime favorite, the FHA loan, requires 3.5% down. What’s more, some programs allow down payment contributions from family members in the form of a gift. Some programs require even less. VA loans and USDA loans can be made with zero down. However, these programs are more restrictive. VA loans are only made to former or current military servicemembers. USDA loans are only available to low to-middle income buyers in USDA-eligible rural areas. For many years, conventional loans required a 20% down payment. These types of loans were typically taken out by repeat buyers who could use equity from their existing home as a source of down payment funds. However, some newer conventional loan programs are available with 3% down if the borrower carries private mortgage insurance (PMI).

Most loan programs require a FICO score of 620 or better. Borrowers with higher credit scores represent less risk to the lender, often resulting in a lower the down payment requirement and better interest rate. Conversely, home shoppers with lower credit scores may need to bring more money to the table (or accept a higher interest rate) to offset the lender’s risk.

Written offers should stipulate the timeframe in which the seller should respond. Giving them twenty-four hours should be sufficient.

Sellers can flat-out accept or reject an initial offer. But there a third path that is quite common, sellers can initiate a counteroffer. Remember this: a deal isn’t dead until it’s dead. So, if a counteroffer is proffered by the seller, you’re still in the game. You and your agent just need to review it determine whether the counteroffer is acceptable. If so, then approving it closes the deal immediately. Keep in mind, offers and counteroffers can go back-and-forth many times; this is not unusual and negotiations are a part of what Realtors do as a matter of routine. Each revision should bring both parties closer together on the terms of the deal.