How much Is It Worth?
Setting the right price is an important first step in selling a home. Sellers often wonder if they should spend $200 to $400 for a professional appraisal of their property before placing it on the market. A professional appraiser's opinion of a property's market value is based on the recent sales of similar homes. Different appraisers could come up with different numbers. But even if all of them agreed on a value, there is no guarantee that you would receive that amount for your property. An alternative to a professional appraisal is to ask a professional Realtor for a written market analysis of your property. This analysis will include information about recent home sales in your neighborhood, as well as how those homes compare to yours. Realtors may provide this service with no charge or obligation. If you are still unsure of the value of your home, then you may wish to pay for an appraisal.
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Fair Market Value
What is the best price for a piece of real estate? Mortgage lenders, appraisers, and real estate brokers use what is called the "fair market value" (FMV). FMV has been defined as "the price that a buyer is willing to pay and the seller is willing to accept, when both parties are knowledgeable about the property and neither is under any time pressure to buy or sell". Sounds great, but how is this price determined?
The starting point for determining a fair price may be an opinion of the value or "competitive market analysis". Such an analysis uses information on similar properties which are: 1) currently for sale, 2) already sold, or 3) expired properties (those which did not sell). Local, national and international trends and market conditions must also be evaluated.
By comparing similar properties in each of the 3 categories and the market conditions, appraisers, lenders and agents come very close to the maximum price that buyers would be willing to pay for a house.
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Lender's Appraisal
Many sellers think that the price of their home is determined solely by what they are willing to accept and what the buyer is willing to pay. But there is one more variable - the lender's appraisal. To protect the interest of their investors, the mortgage lender hires an appraiser to give an independent, objective evaluation of what the property is worth. If the appraised value is lower than the selling price, the seller will be glad that he has enlisted the services of a professional Realtor. The agent can give the appraiser information about neighboring homes that have recently sold that support the seller's price. If an appeal to the appraiser is not successful, some delicate negotiations will follow. Both the seller and the buyer may have to make concessions. The bank may ask the buyers to increase their down payment or ask the sellers for a reduction in price.
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Professional Appraisals
Before your mortgage application is approved, the lender will order a professional appraisal of the home to make sure that the agreed-upon price is in line with the current market values. The appraiser's fee will be based on the complexity of the appraisal and the time required. A professional appraiser will choose the appraisal technique that is applicable to the particular property to arrive at an unbiased opinion of the value. 
One technique is to look at comparable homes in the area that have sold for the contractual price within the last 6 months. The price of each comparable home is adjusted to reflect the differences between it and the house being appraised. If there are a number of similar properties that have sold recently, the appraiser's job is easy. It is more complicated to arrive at the appraised value if your home is located in a rural area or a diverse neighborhood. The appraised value will usually be very close to the sale price. If the appraisal comes in lower, the Realtor may be able to provide the appraisers with additional information on recent sales which will result in increased value.
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Working With Appraisers
After the buyer and seller agree on the price, there is another person who must be convinced that the house is worth the selling price - the mortgage company's appraiser. The appraiser looks for 3 similar houses that have sold in the same area within the last 6 or so months, and compares the selling prices of these homes with the one you are buying. They make adjustments to account for the differences in each property, and the price for your house will be the average of the adjusted prices of the other 3 homes. 
n subdivisions or condominium projects where there are many similar properties and plenty of recent sales, the appraiser's job is fairly easy. In neighborhoods of older homes that have been renovated or remodeled over the years, it can be like comparing apples and oranges. If the appraiser's evaluation is lower than the selling price, it can threaten the transaction if the lender declines the buyer's loan based on the appraisal. In that case, a knowledgeable Realtor can sometimes work with the appraiser to make the transaction work.
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The Home Inspection
You've finally found the home that is right for you, but you have some questions about the structure and condition of the home. A home inspection is the best place to get answers to your questions. There are companies that specialize in inspecting new and used homes. Most sellers allow a reasonable amount of time to have the property inspected after the purchase agreement is agreed upon and prior to closing. 
It is wise to have a home inspection, even if the house is new or everything appears to be in perfect condition. The inspector can provide important information about the house. Where are the gas and water shut-off valves? How do the circuit breakers operate? What type of routine maintenance should be done for each system? The inspector's fee is an investment that can save you money later!
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Your Own Inspection
Many home buyers today are investing in a professional structural inspection before they finalize their purchase of a home. You should choose an inspector carefully and be prepared to learn important facts about your new home that could save you money.
When you have a ratified sales agreement, the Realtor will set up an appointment for you to see the home with the inspector. Bring a notebook, even though you will get a written report of the inspection. Write down any questions or concerns that may occur to you as you tour the house, such as cracks in the walls, spots on the ceiling, or noises in the air conditioning system. And remember that no house is perfect. You should come away from the inspection with a good understanding of what you are buying and how much the maintenance will cost.
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Pass The Termite Test
Most real estate offers require an inspection by a licensed exterminator to determine that the house doesn't have termites or other wood boring insects. The inspector will look for 2 things in deciding whether or not to pass a house - an active infestation and evidence of a past infestation.
If your house does not pass the termite inspection, get a list of qualified exterminators from your Realtor. Find out the treatment options they offer and their charges for the service. Exterminators are usually quite competitive. If your home was treated for a past infestation, the company which performed the extermination may be willing to re-certify your home without a second treatment. Arrange for the termite inspection as early as possible, so you will have time to determine the best way to get rid of them, if they are found.
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Fix Those "Little Problems"
Most houses have a few "little" problems, like leaking faucets, a stove burner that won't light, or electrical outlets with too much "spark". These defects may not seem very important - unless your house is about to go on the market.
We rarely have difficulty getting sellers to agree to paint, replace worn carpets or plant a few flowers in the front yard. These kinds of repairs obviously increase the overall appeal of the property. However, if any of the major systems in your home need maintenance, be sure to have the necessary repairs made. It is also a good idea to have your furnace, central air-conditioning system, plumbing and wiring checked as part of your pre-marketing efforts. The best rule is - if it's broken, fix it!
The purchase agreement requires that a house be conveyed with all the systems in working order, and most buyers will bring in a home inspector to identify any problems. During the period of time between the "meeting of the minds" and the removal of the inspection contingencies, the buyers are the most vulnerable to an attack of buyer's remorse. This is also the time when anything that hasn't been repaired could become a major issue.
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Inspection Repairs
When you sell a house, the buyers will probably have a home inspection before they are contractually obligated to purchase the home. The inspector may turn up something that needs attention or repair, and after the inspection, the buyers may produce a list of items they want repaired as a condition for moving forward on the sale.
When you get the buyers' list, remember that some of the items may be negotiable. Sales contracts usually require that all the systems be in working condition. Some buyers may make requests that go beyond the normal obligations of the seller. They may ask for a new roof or certain structural repairs that you may not want to make. Your agent can help you to assess the risks of just saying "no" to buyers who are making demands you consider to be unreasonable. You may just decline the requests, but the buyers may back out of the deal as a result. When you agree to make repairs, hire licensed professionals who will back up their work and give copies of the receipts to the buyers. Arrange to have the repairs made as far ahead of time to avoid last-minute complications which could compromise the transaction.
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The Good Inspector
Structural inspection contingencies are a common feature of offers. A buyer is allowed a certain period of time to have an expert look over the home - the structure, plumbing, wiring, roof, and appliances that they will have a good idea of what they are getting into.
How do you find the right inspector? Look for an expert on pre-purchase home inspections, not simply a renovation contractor or a friend who can tell copper from galvanized pipes. There are specialists in most cities, or you can obtain a list us. Ask for recommendations from friends who have recently purchased homes. Most inspectors have some background in building or engineering, and have had additional training related specifically to residences. Call several companies, and ask about the background and training of the staff, as well as their rates.
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Walk-Through
It's the day that you close on the sale of your home, and the buyers are a little cranky. During the walk-through inspection, your dependable old dishwasher stopped midway through its cycle, and the powder room toilet flunked its flush. These situations may cause some anxiety for the buyers and sellers, but such problems are quite common and usually easy to resolve.
Most purchase agreements require that the major mechanical systems and the appliances being conveyed are in working order at the time of the closing. Defects are often discovered during the structural inspection, allowing the sellers have plenty of time to have the repairs made. Occasionally there are last-minute breakdowns or defects that are not spotted until the walk-through inspection. In that case, an agreement can be made with the sellers at the closing to escrow funds for the repair or replacement of the items in question.
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Structural Contingency
You found a terrific house and, like many smart home buyers, you included a structural inspection contingency in your purchase agreement. What happens when you find out that your "perfect" house needs some work? Do you ask the sellers to pay for the repairs? Before you answer "yes", there are some important considerations.
Some contracts require all the systems, such as plumbing, heating, electrical and central air conditioning, to be in working order. In this case, the sellers may be obligated to repair any problems with these systems. Leaky roofs, damp basements, or other structural problems may not be covered, however. If you ask the sellers to make these types of repairs, you may void the contract by doing so. The sellers might prefer to negotiate the repairs to keep from losing the sale. If there are other buyers waiting in the wings with back-up contracts, however, you run the risk of losing the home.
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Purchase Negotiations
When your Realtor calls to say there is an offer on your home, you get excited. Then you hear the offer and get an adrenaline rush. Whether the offer is good or bad, you should just remain calm - and discuss a counter-offer with your Realtor. The negotiations of a purchase begin with the buyer's ideal terms and a counter offer of the seller's ideal terms.
A good agent will look beyond the price when evaluating an offer. If the buyers' financial qualifications are shaky or the offer has subtle terms or conditions, your Realtor should be there to minimize any risk to you and to address these items in your counter-offer. Your agent's job is not to make a decision for you, but to be sure that you understand fully what the offer includes and what is expected of you.
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Offers and Counter Offers
Many of the offers we submit for prospective buyers aren't exactly what the sellers want; the price may be lower than they are asking or there might be terms that will require negotiation. What happens after the offer is submitted?
The seller's Realtor will present the offer to the sellers, along with the buyer's qualifications. If the sellers accept the offer, then you have a purchase agreement. If the sellers counter the offer, the next action would be initiated by the buyers. If you want to buy a particular house, your chances of succeeding are greater if your offer is as close to the asking price as possible. You could save money by engaging in lengthy negotiations, but you run the risk of losing the home if another offer comes in or you risk offending the seller.
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Negotiations
The beginning of negotiations is usually the end of many months of hard work for the buyer or seller. The work ahead requires skill in order to maintain a strong position.
Sellers can lose their advantage if they do not counter an offer that a buyer has made. Even if the opening offer is beneath what the seller feels is reasonable, it is advisable for the seller to respond with a slight reduction from the asking price. The most important component in negotiating is good communication.
The best way to handle a low offer is to counter it with definite terms that are favorable to the seller. A counter offer has 2 advantages: 1) it keeps the buyer interested, and 2) it moves the negotiation forward and gives the buyer the opportunity to submit another offer that the seller is more likely to prefer.
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Negotiating Factors
It is easy to be offended by someone who is making an offer on your property. Even if the buyers love your house, they are trying to negotiate the best possible price and terms. They probably will not let you know how much they want your home until they have a purchase and sales agreement.
Buyers almost never write offers that please the sellers entirely. Offers and counter offers may be traded back and forth over a few days or even weeks. When there is finally a meeting of the minds, both sides may feel worn down by the whole process. One of a Realtor's most important jobs is to act as the intermediary during such negotiations. With our knowledge of financing, negotiation procedures, and the tax laws affecting real estate sales, we come up with creative solutions to the challenges that may arise.
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Know Your Price Range
You have just found the perfect new home for your growing family, but it is a little out of your price range - unless you can get an extra $20,000 for your current home. One can never be sure how much a home will sell for. It is always possible to list a home for a little more than it may be worth in the hopes that you could get lucky. After all, it just takes 1 buyer, and the market is busy!
However, if you want to sell your home quickly, maybe you should consider taking less than you hoped to get, therefore, keeping the price a little lower. Don't buy and sell so close to the wire that you become concerned that the numbers aren't as close as you would like them to be. If you set your price within 5% of the market value, you greatly increase your chances of getting good offers that will result in a relatively fast sale. There may be other ways to increase your buying power and get you into that new home, such as adjustable rate mortgages or owner financing. When you are selling 1 home and buying another, you will need more than luck and the possibility of finding 1 person who may be willing to pay the extra amount you would like to get. Remember, you will need a highly professional Realtor who can give you solid advice on how to make the transaction work for you.
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Evaluating Multiple Bids
When you are faced with multiple offers on your home, how do you choose the right one? Your Realtor can help you compare and contrast the terms of each proposal. First, there is the price. Consider the closing costs you may be asked to pay, and be sure that you understand any other terms that might reduce your net profit. Can you work out a mutually agreeable date for you to move out and for the buyers to move in? How "clean" is each offer? Do the buyers have another property to sell before they can close on yours? Can you get reasonable assurances that the buyers will be able to qualify for the financing they will need? Your Realtor can help you weigh the relative merits of each offer, so that you can accept - or counter - the best one, and line up one as an alternative.
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House Odors
Your dog or cat can pose a problem when your property is listed for sale. Even if prospective buyers have pets of their own that smell just like yours, they may be repelled by animal odors. If you have a pet odor problem, you should remove the offending furniture or carpets or hire a professional to clean them. Check the cat box frequently and keep the litter fresh.
Some people have allergies or irrational fears of certain animals, so it is a good idea to put dogs or cats outside or confine them to 1 area when your house is being shown. It is hard for buyers to appreciate your home through puffy, watery eyes or in between sneezes! Even if the house is exactly what they want, your chances of selling it are less if the buyers are afraid of being eaten by Fido.
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Dog Houses
Think everyone likes dogs? Think again! A family pet may be a major problem when a house is being marketed. This is a sensitive issue for a Realtor to communicate to sellers.
Even though he is just doing "his job", a dog's bark will sound ferocious to anyone who is knocking at the door. This is usually a good thing, but when your home is on the market, Realtors will be bringing a lot of strangers to the door. Most Realtors are concerned about the unpredictability of dogs they don't know. When they are greeted by a barking dog, they may not be willing to enter the house unless the owner is at home. If your dog is confined to part of the house, such as a basement, be sure to put up a sign informing people of that fact. Talk with your Realtor about the best way to manage your pet while your house is being shown, and make sure that this information is included in the MLS listing.
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A Smooth Closing
The moving van has just pulled away, leaving you with years of dust bunnies and grime that you didn't know was there. You are tired, and the last thing you feel like doing is scrubbing your house for the new owners. Leaving your home impeccably clean is one of the most important things you can do to ensure a smooth closing.
Your buyers will do their "walk-through" before the closing to make sure that the systems are in working order and that the agreed-upon repairs were made. They will feel better about the whole process if they walk into a spotless house. This will be their last opportunity to experience an attack of buyers' remorse, and your efforts can minimize any second thoughts they may be having or any crankiness about issues that must be resolved at the closing. If you are too tired to do the cleaning yourself, calling a professional cleaner will be worth the investment.
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Closing Tips
The closing table is the ideal place to sign papers, trade keys, and drink a toast to the new homeowners. Sometimes the closing is filled with tension and pressure as each side tries to work out important details of the transaction at the last minute. 
How can you help make your closing a relaxed and happy one? First, try to get the details worked out ahead of time. There may be a few unresolved issues, such as repairs that were not completed, a disappearing dining room chandelier or a pre- or post-closing occupancy agreement. The atmosphere doesn't need to become adversarial, and minor upsets should not threaten the entire transaction. If you anticipate a problem, no matter how minor it may seem, be sure to communicate the situation to your Realtor in advance, so that it can be handled before it has a chance to escalate.
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How We Market Your Home
Before signing a contract with any Realtor, make sure you know EXACTLY how your home will be marketed. A "Listing Presentation" is an industry term for the formal presentation that Realtors make to you detailing how they propose to sell your home within your time frame, for as much as the market will bear. We would love the opportunity to make such a presentation to you. After carefully walking through your home, considering it from the prospective buyers viewpoint, we will tell you areas that may need improvement so as not to detract from your home’s overall appeal. Then we will consider the CMA (Comparative Market Analysis) of your home. We'll compare your home to others like it that have recently sold, and also to others that are currently for sale. This is a very important way of determining the fair market value of your property. We will tell you where your home will be advertised, both in print, in upscale publications and on the web. With the dramatic growth in homebuyer usage of the Web, you MUST have a Realtor that can extensively market your home online!  We can place your home on our web site within a few minutes’ time! We will also discuss open houses and other means to expose your house to buyers.
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