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How Home Sellers Can Maximize Buyer Offers

Today’s market can be a difficult one for many sellers to navigate. While your real estate agent can advise you, the ultimate decision of what offer to accept is entirely up to you.

This decision can come with quite a bit of pressure. Even in the most favorable of markets this can be a difficult time. How do you know when to accept an offer?

maximize offers
Here are some questions to consider:

•  Is the buyer pre-qualified/approved? Selling will require an investment of time and money. You may need to find a new home or a temporary rental. There’s nothing worse than buying a new house only to find out the deal to sell yours has fallen through.

•  Do you need to move? The urgency of your move may dictate what offer you accept. Many sellers need to move quickly for a new job. You may need to sell to avoid foreclosure. If you are in a rush, you may need to accept an offer that is less than ideal.

•  How much do you owe? You don’t want to sell your home at a loss. And be sure to take closing costs into consideration. Many markets experienced high levels of depreciation over the last year. If you are underwater on your loan, now may not be the time to sell.

•  What is the market climate? Are you likely to get another offer? How long has your home been on the market? Have you had many showings? All of these are factors to consider when contemplating what offer to accept.

Above all, ask yourself if this offer was a reasonable offer. There are buyers that may attempt to low ball you. They may see that your home has been on the market longer than your competition. They may know that it’s a strong buyers market. In response they offer a much smaller amount for your home than it is worth. You are not obligated to accept these low ball offers. However, if you are in need of selling now, every offer warrants consideration or a counter offer.
In the end, you must accept an offer that works for you. You may be willing to accept a lower amount in exchange for a faster closing date. Or you may wish to hold out for the highest dollar amount.

Written by Carla Hill, RealtyTimes

Buying Home Direct

Why Direct Deals Are Bad for the Seller?

Ooh, a direct deal. That’s when the home buyer is not represented by an agent so the listing agent works directly with the buyer. Every agent wants a direct deal so they can keep double the commission. And sellers like it because often, without a co-broke, the commission will be cut (say from 5% to 4%).

Buying Home DirectListing agent makes more money while seller pays less commission, so what is the problem?

I don’t like direct deals and I think they are a rotten situation for sellers!

This unconventional piece of wisdom comes from years of experience, and has recently been reenforced during a condo sale.

At an open house I hosted two weeks ago a buyer came to me and wanted to write the offer directly with me. The next day We met, sat down, wrote the offer….well, most of it.

First, by law, I had to disclose to the buyer that I work for the seller. With this in mind, we started the money conversation.

Buyer wanted to offer well under the asking price. As I discuss the price with her, she listens, she nods, and she says (I paraphrase), “You work for the seller, why should I listen to you?”

As someone representing the seller, I do not have the authority to represent any price but the full asking price. I am not free to negotiate money which is not mine. Which is besides the fact I thought the asking price was reasonable.

As I asked her to sign the offer, she hesitates, “You know, maybe I should have my own agent review this.”

I asked her if she knew anyone, she does, she calls and books an appointment with this other agent immediately.

Two hours later, I received an offer from this buyer through her buyer’s agent. It was a much higher, much better offer. It reflected a buyer who understood the market and the process.

Seems to defy logic, that a buyer’s agent will write a much better offer than the seller’s agent?

The fact is, as long as my ficuciary obligation is to the seller, nothing I say to a buyer carries much weight. I may be giving excellent and honest advice, but none of it can be contrary to my clients best interests, or what they tell me to represent.

A buyer knows there is a choice to be represented, and once she is aware of the fact she is not, hesitation sets in. Buying a condo is a bit complex and expensive.

By seeking reprentation, the buyer agent is there through the whole transaction to explain everyting, and ensure the buyer understands it. The buyer receives advice congruent with her interests, and thus she is a more informed and eager.

Financially my client is ahead because the home buyer trusted her agent’s advice – a trust I can’t instill as someone representing the seller.

An educated, well represented buyer will make stronger offers, take the transaction more seriously, and is much more likely to close.

Isn’t that the goal?

finding best real estate agent

3 Tips to Negotiate Real Estate Commission

finding best real estate agentIt’s a common situation all real estate agents experience. We are discussing the benefits of our services with a perspective seller, and the commission bomb is dropped: “Is the commission negotiable,” the homeowner asks.

“Some agents will do this for 4%,” is another comment I hear often in Brighton.

While most agents fear the commission questions, I welcome them. It is my opinion every perspective seller who did not ask about it, wanted to do so, but didn’t feel it appropriate. It’s on everyone’s mind.

Here are three tips on how negotiating real estate commission, and the replies to expect from the agents you interview for to sell your condo or house in Brookline, Brighton or Newton.

1. Invite more than one real estate agent for a presentation. More options will give you leverage. Tell the agents you are interviewing others.  Knowing this, some agents may offer you a better commission price on the spot or expect to negotiate.

The best real estate agent you will interview will be unfazed by competition and follow-up when you finish interviewing. A highly qualified real estate agent who believes in what she does will not offer a discount.

2. Ask for a specific discount. When home sellers ask me the vague question, “Is the commission negotiable,” my answer is, “Only if you want to pay more.” Everyone laughs, subject is dropped.

When you ask for a specific commission reduction, “Can you reduce it by 0.5%?” for example, the answer must be more specific. A weak real estate professional will be caught off guard and likely say yes.

Your best candidate will say no, and tell you why. The commission breakdown should be transparent. You’ll understand why a 0.5% break for you is a 25% discount in the listing agen’ts compensation. Would you take a 25% pay reduction from your boss? You’d probably look for a better job.

3. Don’t be timid. Most home sellers interviewing real estate agents are uncomfortable negotiating and shy about asking for the discount. Many real estate agents rely on your timidity to get paid full price. If you do not ask the hard questions, you may not find your best candidate.

The best real estate agent to sell your home will never offer a commission discount up-front, and will not yield on negotiating the commission. An agent ready to negotiate commission will be all too ready to negotiate the price of your home and terms and conditions for your sale. If you can easily negotiate with an agent, you should be wary of hiring him to represent your interests.

Instead, use the real estate commission negotiation question to find a confident agent who can handle uncomfortable questions and demonstrates the value of her commission.

Do you have a commission question?  Are you considering curious about the costs of selling a home?  Write me below:

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Ask your real estate questions and I'll get back to you as fast as I can. *YOUR INFORMATION IS CONFIDENTIAL AND WILL NOT BE SHARED WITH OR SOLD TO ANYONE, EVER!*
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Newton Real Estate Buyers

Do Home Buyers Pay A Commission in Newton MA?

Home buyers in Newton and the Greater Boston Area often ask me how do real estate agents get paid? It is a source of confusion and sometimes it prevents buyers from hiring an buyer’s agent.

Newton Real Estate Buyers

Here are answers to the most common questions around real estate commission home buyers often ask:

1. Do Home Buyers Pay a Real Estate Commission?
The price of the home reflects the full commission which will be paid to both the buyer’s and the seller’s agent. There is rarely commission to be paid to your agent above what is already included in the price of the home.

2. Are there exceptions?
There is an exception, though. If you have a buyer agency agreement with your broker, there are rare occassions when the commission paid through the price will not cover the full commission your broker charges. For example, your contract may have a 2.5% commission agreement, but the listing agent is only cooporating at a 2% commission.

How is this resolved?
When the commission included in the price does not cover the buyer agent’s commission, One of three things happen.
a. Your agent will demand the seller pays the full 2.5% out of the sale proceeds. This will be written into the offer which you sign.
b. Your agent may forgo the .5% commission.
c. You may have to pay the balance of the commission at closing.

Please note discount commissions are rare in Newton, MA. In my experience, I never sellers often agree to pay the full commission out of their proceeds.

3. If there is a chance I will pay additional commission, why sign a buyer agency agreement?
It is a rare occassion the buyer pays real estate commission beyond the purchase price. It usually happens when the sale is through a discount broker representing the seller or a for-sale-by-owner. Your buyer’s agent has much more work to do in either of these scenarios.

Furthermore, the buyer agency agreement is designed to protect the interest of the buyer. When hiring a excellent agent, the risk of possibly paying extra commission will be far outweighed by the risks of buying a home without representation in Newton MA.

Hiring a buyer’s agent will save you money, time, and a lot of energy. Having experienced representation will give you confidence in your decisions and guidance in your search. If you have hesitations and reservations about paying a commission, review your agency contract carefully and discuss with your agent. A highly qualified buyer’s broker will be well worth the commitment.

Do you have other questions about commission and how real estate agents get paid?  Contact me for a complete breakdown!

Got a Question?

We would love to hear from you! Please fill out this form and we will get in touch with you within 24 hours. *YOUR INFORMATION IS CONFIDENTIAL AND WILL NOT BE SHARED WITH OR SOLD TO ANYONE, EVER!*

Three Most Important Contingencies When Buying a Condo

Are you working with a Realtor on your home purchase in Boston? I certainly hope so!  If you are going at it alone, you may overlook the most important contingencies when buying a condo.  In Massachusetts there are two contingencies written into the offer to purchase paperwork.  But what’s not in the standard offer is the most important when buying a condo.  Row of brick houses in Boston

Here are the three contingencies you must have in your offer to buy a condo:

1. Inspection Contingency.  Conduct an inspection with a licensed inspector who comes highly recommended.  You will have 7-10 days (including weekends) to conduct this inspection. Ensure you receive the report in a timely manner, and if you need more time, file for an contingency extension.

2. Financing / Mortgage Contingency.  Unless you are paying cash, you will probably have a mortgage contingency in your offer.  The standard paperwork has it built into the offer.  Usually, roughly a month to six weeks after the offer is accepted.  If you are closing quickly, you’ll have to get it done sooner.  Don’t forget to submit your completed mortgage application in accordance with the deadline in the offer.  If you read carefully through the paperwork, you’ll find the buyer’s obligation to file an application by a specified day.  If not done on time you jeopardize the validity of the mortgage contingency.

3. Condominium Documents Review.  Although not included in the standard paperwork, the condo document review is in my opinion the most important contingency when buying a condo.  It allows you time to read through the condominium documents and financial statements, and pass them on to your attorney to look for anything out of the ordinary.

Why is this so important?  You will learn about the financial health of the building, rules and regulations, and a lot more detail about how the condo association functions.      If the building is in a dismal financial situation and poorly run, expect the value of the condo to deteriorate or the association to have large expenses in the near term.  Furthermore, the mortgage company may reject your application if the building has low owner occupancy or lack of funds.

When including the condominium documents review contingency, don’t forget to specify the documents will be provided within two business days.  The listing broker should have them ready before the condo goes on market, so this should not be a problem.

Writing an offer to purchase a condo requires thought and preparation. Learn the contingencies and don’t depend on standard paperwork alone to protect your interests.

 

buying a home

Three Signs Your Buyer Agent is Not Very Good

Stop your home search, start your buyer agent search!  If you are not getting results, find a better agent.

In the seller’s market, working with a hard working competent buyers agent is necessary in order to buy a property at the right price.

buying a home

Is Your Real Estate Agent Asleep At The Wheel?

Yet many buyers are failing at securing a home, and buyers are getting caught up in the stressful and intense market.

Here are three signs your buyers agent may not be your ideal advocate, and perhaps it’s time to switch.

1. Your agent is waiting to see what comes up on MLS.  If this is the only strategy employed to find a home, that’s not enough in the hot real estate markets such as Brookline and Newton.  Whether working with property investors or home buyers, a buyer’s agent can do other things to look for the right property, including networking and sending mailings to neighborhoods.

2. Your agent is not asking hard questions.  Your agent should ask you questions that force you to examine your price range, timing and every possible angle of the home buying decisions.  An experienced agent knows buyers don’t always buy what they say they will.  Such an agent thinks outside the criteria you have, finding alternatives, and presenting options and possibilities.

3. Your agent does not prepare you for the market and set expectations.  You should know what to expect when you are ready to make an offer, and be prepared for rejections.  When you choose a home you like is NOT the time for your primary real estate education.  You must be ready to go.  Finding the right home is the last step of the home search process, not the first.

Don’t get stuck with a buyers agent who isn’t servicing you.  If buying a home is important, do it right or expect it will go terribly wrong.

bathroom boston condo

Bathroom Renovation and Resale Value for Your Condo

bathroom boston condo

Original subway tile are chic!

Tight space, tight budget, and the fear of sinking money you won’t get back.  Bathroom renovation resale value is not always 100%.  When getting ready to sell your Boston condo, you can make small inexpensive changes with a big impact.

A bathroom is a small space which can make or break a sale.  If it’s yucky, the whole place will be perceived to be a run down home.  A dreamy bathroom can sell the condo. In bathrooms, details can be glaring.  Yet, you can avoid spending tens of thousands of dollars on a complete bathroom renovation, money you won’t get back.

Changing the common mud-back tiles can be very expensive and exhuasting, and completely unnecessary.  Here are the components you need to consider in a small bathroom.  Complete this checklist and you can have a bathroom which will help sell the condo and make you more money.

1.       Medicine Cabinets: If your medicine cabinet can’t be cleaned to a spotless shine, or if it has worn edges, ANY rust, or if it is not stylish, GET RID OF IT.  A medicine cabinet is where the eyes go when you enter the bathroom, and it makes the first impression.  Medicine cabinets which suit your Boston condo can be budget friendly or very spiffy.  Go for something simple and in-line with the condo’s value.

I suggest also getting something with clean lines and big.  Buyers want storage and it will draw the eyes away from the imperfections

brighton condo sold

New curtain, towels and vanity.

beyond repair.

2.       Paint: Peeling paint from excessive moisture, or any discoloration, you must paint.  A sloppy paint job is unforgiving in the bathroom, so take the time to do it right, or hire a painter.  Choose a color which isn’t too weird, please.

3.       Fluffy towels: Buy new towels, and hang them on the towel racks and stack them if you have the space.  Fluffy things make us happy.  Make the buyer happy, it’ll cost you $40.

4.       Clean: Really really clean.  The corners, the spaces behind and in-between, the door, window, tile, top of the medicine cabinet, light fixtures.  If  you don’t feel like Cinderella, you are not cleaning hard enough.

5.       Glaze Tub: If your tub is very dirty, grimy, and stained, glazing can do the trick for only a few hundred dollars.  Just mild discoloration may be overlooked with some non-slip decals.

Note, this is a simple cosmetic issue.  Never ever cover-up or draw attention away from damage to the home.

brighton condo sold

New curtain, medicine cabinet, and lighting.

6.       Vanity: This is one of the pricier items on the list, but if your vanity is outdated, the whole bathroom is outdated.  Invest a few hundred dollars in something new.  It doesn’t have to be fancy.  Once of my clients switched from a tiny vanity which was very low, to a more substantial one, and a bit higher for $300.  The whole bathroom looked new.

7.       Toilet: You know when you need a new toilet.  Take a long hard look at your toilet and ask yourself, “is it time?”

8.       Shower Curtain: All homes going on the market need a brand new shower curtain.  Shower curtains come in such a variety of colors and styles, and in fabrics which can change the look and feel of every bathroom in minutes and for as little as $30.  It will be one of the best investments you will make getting your condo ready for sale.

selling boston condo

New shower curtain and a good cleaning.

9.       Lighting: Bathrooms need bright lights to create a cheerful atmosphere.  Light bulbs must work, and the fixtures either clean or new.

If you have odd colored mud-back tiles, (Avocado, Mustard, Pepto), the shower curtain, towels and paint are an opportunity to tie them into something more neutral and modern.  It’s no longer dated, now it’s vintage!

Follow these tips and your bathroom renovation resale value for your Boston condo will be well over 100%!

Click on the link for more advice for home sellers.

contingency to sell home

Contingency to Sell Home: Selling a Condo and Buying a House in Boston

contingency to sell home

Caught Between Two Properties?

If you need to sell your condo in order to buy a house in Brookline, Newton and the Greater Boston area, you are not alone. With housing so expensive, not many can manage to keep both mortgages, or pay for the house without the proceeds from the condo.

A contingency to sell your home is a common way to protect you in this situation. You make an offer with a contingency on an accepted offer, purchase and sale, or closing of the condo you are selling.

Sounds like a plan, right? WRONG!

In today’s market you are competing with other buyers, and a contingency to sell a home is a great way to RUIN your chances of securing the property of your choice. Put your home-seller thinking cap for prospective for a moment.

An offer with a contingency to sell a home is a high risk offer. Regardless of the type of property to sell or how easily it will sell, it is far removed from the seller and the seller’s agent. Furthermore, such an offer is likely to have delays and it comes with too many unknowns. Why accept such an offer when there are better ones on the table, or will be coming?

It is worth it for the seller to wait for another offer while you work on selling your condo. From the seller’s point of view, you can come back after you sold and your offer will be accepted then. Why risk taking the home off market now?

So what do you do when selling a condo and buying a house in the Boston area, with our current market conditions?

1. HIRE AN AGENT who has done this several times and knows how to protect your interests while securing a property.
2. Work on selling first and prepare to buy quickly once you have a P&S in hand.
3. Sell first, with a flexible closing so you have time to find your new home.
4. Work with your agent and mortgage broker. You may be able to take a bit of risk and make an offer without selling and without a contingency. Learn all the facts and how it may work.
5. Present an offer with a very long closing giving you time to sell the condo first

The bottom line is that you will have to stay flexible. You may or may not have to take financial risk – it depends on the properties, finances and closing dates. Most importantly, hire a real estate agent who knows how to work under pressure and protect your interests.

Feel free to schedule a free consultation to learn how to best manage your risk while buying and selling a home.

negotiation home prices

Negotiate prices Like a Pro

negotiation home prices

Interested in negotiating a

 

I was ten years old when the Saturn cars were introduced.  All the excitement was over how you didn’t negotiate the price, it was the “no haggle” brand. Even thought I was just a kid, it sounded like a rotten deal to me and all the fun was taken out of buying a big ticket item.  Who’d want a car not worth fighting for?

My appreciation and love for negotiation naturally lead me to real estate.  We negotiate everything, everywhere, constantly.  It’s not always about price.  There is a lot to negotiate: timeline, repairs, and all the other terms and conditions going into a real estate transaction.

Whether you are buying a home or anything else, here are rules to negotiate confidently and have things going your way.

Rule #1 Don’t Make It Personal.  Some people take negotiations over a house so personally, as if the other party is insulting them.  That’s just silly.  You have to keep in mind what it is you are negotiating and your goals for the outcome.  Remember, the other side’s messages are not about you.  Each party just wants the best outcome for themselves, not necessarily the worse outcome for you.

Rule #2 Never Assume.  Don’t assume anything about the other party.  Buyers assume things about the sellers such as when they need to move.  Many buyers tell me things such as, “It seems the sellers don’t need to move quickly, so let’s make a higher offer to motivate them.”  Or an even better one I hear is, “They bought it for $X five years ago so they won’t take less than $X+7.”  Those are both assumptions.  I don’t know anything about a sellers and how much money they’ll take until I have a reaction to an offer.

Rule #3 Be Fearless.  Don’t fear a negative reaction from a seller.  Your negotiations should reflect your needs and goals.  It’s imperative you first know your goals: how much you are willing to pay and what it is you will and will not do to get it.  If there is a time to make decisions and stick to them, it’s when negotiating for a home.  What I love about negotiations is that it gives us clarity on what it is we really want, and how much we are willing to pay for it.such as, “It seems the sellers don’t need to move quickly, so let’s make a higher offer to motivate them.”  Or an even better one I hear is, “They bought it for $X five years ago so they won’t take less than $X+7.”  Those are both assumptions.  I don’t know anything about a sellers and how much money they’ll take until I have a reaction to an offer.

Rule #4 Show Respect and Kindness.  You can be fearless and you can take a stand, but always show respect and kindness to the other side of the negotiation table.  Understanding the reasoning for their demands will go a long way.  Simply learning what’s important to them humanizes the whole interaction.  Yielding on something in order to accommodate a priority for the other side will enable you to ask for something in return.  For example, can you move the closing date for two weeks to accommodate the seller’s wedding plans?

Rule #5 Some Compromise is Necessary.  This rules ties in to Rule #4, and together they are called, Don’t Be an Ass.  Find an area on which you are willing to compromise.  Sometimes a small compromise will help you get almost everything you want.  Maybe a little bit more money, or a bit less fighting over inspection items?  I’m all in favor of getting the most out of every deal, but sometimes the most includes goodwill.  Furthermore, don’t expect to pay less than market price.  Sure there are bargains, just don’t try and squeeze water out of a rock, and expect the rock to be okay with that.

 Negotiations are an important part of life, and avoiding them will cost you.  Saturn shut down operations in 2009 and gave General Motors a lot of grief.  The “no haggling” policy had others realizing they are getting a pretty rotten deal. Saturn slogan was “A Different Kind of Car Company,” overlooking the fact that without negotiations we do not achieve satisfaction in our choice.

So haggle on, and follow the rules outlined to negotiate like a pro.