Everything works in a seller’s market

chandelier
light fixture

There are a lot of companies that want to sell products, services, and advice to real estate agents. We are in a strong seller’s market which means a lot of the advice on how to sell a home quickly for a lot of money works. Products and services designed to help homes sell faster and for more money are working well too.

The basics of selling a housework well too:

  1. Clean it up.
  2. Paint – as needed
  3. Repair
  4. declutter/stage
  5. Use professional quality photography.
  6. Price it correctly.

Advertising isn’t as essential as it once was but it does help attract a larger pool of buyers. For many of us selling a home is fairly easy. Getting the job done correctly and legally is still the hard part.

There are some challenges in selling a house. Getting through the inspection phase and getting it to close can be challenging. There are still risks to home owner’s who do not disclose information about their home.

There are still overpriced houses on the market that no one is making offers on. There are even a few that are unfit for use as dwellings without major repairs.

Sometimes homeowners and their agents believe that in a seller’s market they don’t need to disclose. That assumption would be wrong and could be costly.

You are ready to sell but is your kitchen ready?

Getting a house ready to sell is often about cleaning, painting and small repairs. Your kitchen may need extra attention and a deeper cleaning. Here are some suggestions on what you can do to get your kitchen ready.

  1. Clear the countertops.  Remove anything that doesn’t need to be there and about half of the stuff that does need to be there.
  2. Clean cupboards inside and out. Put in some shelf liner.
  3. Remove any items from the cupboards that you will not be used during the next six weeks and then remove half of that.
  4. Clean out the fridge. Try to keep it clean with the minimum amount of food in it.
  5. Run the cleaning cycle on your oven(s). If you don’t know how to clean it find the model number, usually inside on the door frame and ask google for instructions.
  6. Wipe everything down. Make those appliances sparkle. Clean that countertop and the windows too. Scrub the floor.

Make sure that all light fixtures have light bulbs in them. Check the walls and ceilings for grease and dirt. Clean them if needed and repaint if necessary. Consider using a plug-in air freshener.

Personally, I like the candles that smell like various baked good or like apple and cinnamon.  Anything vanilla scented will remind the buyer of fresh baked cookies.

Some stagers like to put fake fruit and cookbooks in kitchens. Today’s buyers especially the younger buyers often prefer a more minimalist approach. Kitchens with less in them look bigger.

Kitchens really do sell houses. A little extra effort in the kitchen will pay off.

kitchen
Kitchen – less is so much more. 

Twin city real estate markets almost identical


The shortage of homes for sale is accute in both Saint Paul and Minneapolis. This isn’t a healthy real estate market and prices may not be sustainable.

The numbers are pretty close but the Twin Cities are not identical twins. Both cities have less than a two month supply of homes for sale. Minneapolis has a 1.6 month supply and St. Paul as a 1.7 month supply. The 13 county metro area has a 2.1 month supply of homes for sale.

Housing supply caculates how long it would take for all of the homes for sale to sell if buyers continued to purchase them at the current rate. The number is also called an “absorption rate”. I really do love numbers . . . and houses too.

Next week I’ll have the numbers for home sales by St. Paul neighborhood because real estate is that local. Nieghborhood data is helpful when pricing a home. If you own a home in St. Paul or the northern suburbs and have been thinking about selling it give us a call.

Can you win against a cash buyer?

Last week I was asked by a first time home buyer about how to compete with a cash offer. The short answer is that it depends. If the home is bank owned or a business is selling it competing against a cash offer is tough unless the offer is super low.

In private home sales, sellers will sometimes reject cash offers if they get a much higher offer from someone who is using financing.

As a general rule offers that include larger down payments are better than offers with smaller down payments. It is hard to compete with a cash offer with 3.5% down. It is even tougher for buyers who are asking the seller to pay the closing costs.

An offer on a home isn’t just about offering the highest dollar amount. There are other terms the seller may be looking for like a particular closing date or more earnest money. Buyers who have a little flexibility on the closing date and who are willing to allow the sellers a little extra time to move out may be able to offer less.

Usually, a cash offer will win if it is for the asking price or close to it. Cash offers are more common for lower-priced homes. First time home buyers and companies that re-hab houses are competing over a small number of affordable houses. Reality isn’t like television. Most first time home buyers do not have the resources to do a major rehab . . . but that is a separate topic for another day.

My advice to home sellers is usually to take the cash offer and if it isn’t high enough sellers should negotiate for more.

Showings are not the same as offers

Home sellers sometimes assume that if their house gets a lot of showings as soon as it comes on the market that it will get an offer right away.

It doesn’t always work that way. Showings are not the same as offers. There are few houses on the market and as a result, buyers are looking at houses that they would normally ignore.

Buyers will tour a house that is almost a good fit or that could be a good fit. We are in a strong seller’s market. During the last buyer’s market, home buyers could cherry pick what they wanted to see.

On average each St. Paul home that is on the market will get 11 showings and the number has been climbing and at the same time, the number of days that it takes to sell a house is decreasing.

The median number of days on the market in St. Paul is around 24. Those days include the days that the house is has a contingent offer on it. Ten days is a kind of standard length for an inspection period.

 

 

About mortgage interest rates

When I write about mortgage interest rates I like to keep it in perspective. Mortgage interest rates are lower than they were a decade ago and lower than they were before the great recession.

When my husband and I bought our first home we got a deal on a bargain basement interest rate of 8.38% with points.   However, the price of the house was about 25% of what it would be today.

Mortgage rate chart from Freddie Mac
Current rates