5 Real Estate Myths Debunked
1.Open Houses don’t sell homes. Agents just hold Open Houses to pick up new buyers.
According to NAR's 2011 Profile of Home Buyers and Sellers, 45 percent of all buyers used open houses as a source in their home search process. This figure suggests the value of open houses even in the Internet era. Women are more likely to use open houses than men, as are buyers who were not born in the U.S. or whose primary language is not English. Older buyers rely more on open houses than younger buyers, and buyers with higher incomes are also more likely to visit open houses.
Locally, in Northern Virginia, Open Houses are very popular. In our easily accessible communities and walkable neighborhoods, Open Houses can offer buyers the opportunity to see what a certain price range will garner in a certain neighborhood- size, condition, and amenities. Not all buyers know what their comfort zone is in terms of price and condition, and Open Houses offer the chance to poke around in advance of scheduling time with a buyer’s agent.
2. Nosy neighbors are not welcome at Open Houses.
Listing Agents generally welcome neighbors who can give them feedback about the house or neighborhood. Neighbors are a great source of information. Also, a neighbor might have a friend or coworker who could be interested in the home. So don't feel embarrassed to admit to the agent that you are "a neighbor from down the street." Finally, traffic into the home makes the Open House appear busy and popular, and could attract more potential buyers!
3. In lieu of making repairs, I can just offer a credit.
What seems like a savings for the seller when initially putting the home on the market might end up costing much more in the long run. We have all heard the song “I look better online” – well, in today’s Internet age, a buyer knows how to weed out the homes with dirty carpet and old appliances. More than 87% of today’s buyers are looking at pictures online. They are looking at them multiple times, on BIG screens, and comparing your home to other homes. You will never get a second chance to make that first impression.
4. The Appraisal is just a formality
In today’s market, a seller has to sell the home twice. You first have to get the buyer to agree to your price, and then the bank will weigh in with their own assessment of value. The appraiser is trained to look for any visible and noticeable faults that could possibly impinge on the habitability of the subject dwelling, especially in the areas of safety and health. Both VA and FHA appraisal guidelines can be strict and can eliminate fixer-uppers from contention. Appraisers can attach conditions so that certain repairs have to be made for the loan to be approved. If a property appraises for less than the contract price, the seller has to reduce the price or the buyer has to bring the difference to the table (in cash.) Ultimately, a low appraisal or an appraisal with conditions can make an otherwise solid contract fall apart. Appraisals conducted for FHA financing remain with the property for 120 days. Therefore, if it comes in low it can have a huge effect on the seller's ability to sell at their asking price.
It is particularly important for a seller to contract with an agent who can effectively determine their home’s market value before listing. Realtors in the business with recent transactions are familiar with appraisal pitfalls and can consult with sellers to avoid unnecessary drama resulting from a low or problematic appraisal.
5. If I have a lot of equity in my home, I will pay enormous taxes when I sell it.
We have to insert the obligatory “we are not tax advisors, consult your CPA” disclaimer here. But the truth is that on a primary residence (you have to have occupied it for 2 of the last 5 years) each owner gets a $250,000 exemption from capital gains taxes. ($500,000 of profit is exempt for married couples who file jointly) So if you are anticipating a PROFIT (seller net proceeds after mortgage and other liens and costs of settlement) of $250,000 or less, or $500,000 or less for a married couple, taxes should not be a factor at play in your decision to sell.
The Selling Edge is a program designed specifically to educate, inform and guide potential home sellers through the home selling process. At best, selling your home has become a much more complicated process requiring professional guidance. New contract law (Jan 2012), financing addenda and home condition requirements can have a major impact on the financial and legal outcome of the home selling process. We aim to provide the highest level of information to put you in the drivers seat as you contemplate selling your home.
Opportunity is Knocking!
The Alexandria market is experiencing unprecedented low housing inventory levels and high buyer demand. There is a backlog of buyers just waiting to find the right property and it could be yours! If you’ve been thinking about selling your home, now is the time! Contact us today for an appointment.