Whatever method you choose, none is better than actually going out on a Sunday and visiting open houses in your neighborhood. You will get a feel for the home buying climate. Take a look at asking prices, how the homes are presented for sale, and most of all, keep an eye on the traffic of the open house. If you see groups of people, you know it’s a sellers market. If you’re the only one at the open house, chances are it may be a buyers market. It’s time well spent. You will be able to talk intelligently with real estate agents that prepare the market analysis and with potential buyers of your home.

During the preparation process, you may wish to locate a good real estate attorney early in the process. They will be able to help you with forms and perhaps contract negotiating. Leave the legal stuff up to them. Check around for fees.

Preparing your home for sale.

You have what you believe a fair price. What next? Start packing!

Go through your home, room by room and start packing away some unessentials. This is the first step in presenting your home to the public. Your home should looked lived in yet it should also be uncluttered, clean and organized. A good example on how to prepare your home for showing is to visit a home builders model. Look how the furniture is arranged. Take notes. If you don’t have the time , call in a maid service for a day. After all, you deserve it. A clean and neat house show better, sells faster, and at a better price. It’s a proven fact. Don’t forget the front yard. Fresh cut grass and nice landscaping encourages ‘curb appeal’. Many home buyers will cruise a neighborhood before they even call on a house, if your home doesn’t look inviting, they may very well keep driving.

Prepare a home selling brochure. You don’t need anything elaborate, just memorable. If you know someone with a computer or have access to one at the public library, you can create a brochure relatively inexpensively. Use a 8 ½ x 11 sheet of paper. Keep to the essentials such as room sizes, what is included in the sale such as stove, refrigerator, etc. Use brand names such as an Amana Range and try to list as many improvements to the property as possible. This helps establish a greater perception of value to the home buyer. Don’t forget to mention the backyard garden or list the fruit tree in the backyard. The buyer may have a green thumb just like you.

A picture speaks a thousand words.

Take a whole roll of pictures of your house from the street on a nice sunny day. Take it to a film developer and have them develop it with duplicates. You should get 72 identical photos of your house. Take these pictures and glue them on your home brochure. This adds excitement to the buyer as they now can show off the house they might buy to their family and friends. Buyers look any many houses. This will also help differentiate your house with your competiton.

Don’t forget the yard sign!

One of the biggest mistakes made in selling a home is that the home seller makes a yard sign, but you can’t read the phone number! Take extreme care in being certain that buyers that drive by can read your phone number. You might want to attached a mail box to your sign that includes some of your brochures. Many buyers have car phones, and may even call from their car if they like your house. If you’re going to be away, you might want to mention how many bedrooms and bathrooms, and asking price on your answering machine. Yard signs serve several purposes. It will help identify your house to drive by buyers, and also let your neighbors know that you are selling. If you have the time, it might be a wise idea to canvas the block as your neighbors may know of someone who would like to move into the neighborhood. Some communities are banning yard signs. Be sure to check with your city is you are unsure if they are not permitted.

Presenting your home.

Ok, you have a price, the house is ready for company, an attractive brochure, and yard sign. What next?

Announce to the world that your home is for sale. Use classified advertising. It is the most affordable way to reach your potential buyer. You’ll need to write at least three different ads. Rotate these ads in your local newspaper that have a decent real estate section. Be descriptive in you ads with a good lead line. For example:

IMMACULATE 3 Bedroom Ranch, walk to parks, and train. $xx,xxx

Don’t do this!

3Br, Ra, wlk to pk and trn.

Remember, you home isn’t going to appeal to everyone. Your goal is to get them to either drive by or more importantly to get them into your house to see it first hand. There are more example in the back of this kit of some ads that sell.

Showing your home and Sunday Open Houses

Sunday open houses is the perfect way to show off your house to potential home buyers. Remember the presentation techniques that your learned at the builders model. Turn on all of the lights. Make the rooms neat and clean. You might want to send the kids over to the neighbors for a few hours. If you have a bread maker, you might even want to make some bread to along with Sunday dinner. Nothing smells nicer that baking bread or a baking pie to welcome your guests. If you have a fireplace, you may want to have a nice fire as well. When you have visitors, walk with them and point out the special features of your home. After all you know them best of all. Avoid at all costs comments such as this is the living room, this is the bedroom. Unless they’re blind, comments such as these can be considered insulting. Instead, point out that the carpet is only two years old and that you have it professionally cleaned twice a year. Point out the new thermopane widows that help save on the heating bills. This process is known as feature benefit selling. You point out the feature and relate the benefits to the buyer. Get their name and phone number.

A word of caution regarding open houses. Just like the real estate agent, you do not know the people that will come through your home. Some may not be so honest. Be sure that you or someone in your family walks with the potential buyers at all times. If you feel that you are losing control, lock the front door with a note stating that you will be with them in a moment. Here is a situation that arose. Two people came into the open house at the same time. During the tour they split up. While one was getting the details on the furnace in the basement, the other was going through the dresser drawers looking for valuables. Be careful. This same situation can happen with a real agent. The wisest thing to do, is place you valuables in a safe deposit box while you’re selling your home. It’s peace of mind.

You have a buyer. The biggest question at this point in time are they willing, ready, and most importantly ABLE to buy the house? How does the real estate agent know if the buyer is able to buy the house. The fact of the matter is that they don’t, unless the buyer has been pre-approved by a mortgage lender. Lets talk a moment about prequalify. Prequlifing a buyer is an estimate, based upon numbers that the buyers provide, upon their ability to buy the house. That is, can they afford to buy it. Here is the formula for estimating a buyers ability. As a general guideline, lending institutions follow two ratios. The first states that buyers principal, Interest, taxes, and Insurance (PITI) cannot exceed 28% of the buyer combined monthly income. The second state that the PITI and long term debts cannot exceed 36% of the buyers combined gross income. These ratios are not written in stone and may be flexible depending upon the type of loan the buyer needs. Will the buyer provide you with their financial information? Not likely. If this sounds confusing, it is. What is best for you as a home seller? Find a buyer that is PRE-APPROVED. A pre-approval, means that the buyer has submitted a financial statement to a lending institution and that the lending institution has most likely already run a credit check on the buyer and has determined the buyers are pre-approved for mortgage amount subject to the appraisial of the property they wish to buy. Now if you did your homework right, that shouldn’t be a problem. With a pre-approved buyer, that time it take to close the transaction will be smoother and shorter. Many home buyers today, realize the importance of being pre-approved, and for their own peace of mind, are doing just that. The lender will issue a letter of pre-approval to the buyer. Don’t take their word on it. Ask to see the letter. You may want to consider some price incentives to home buyers that are pre-approved.

Now the fun begins. Negotiating the contract.

If you’re working with a real estate some things your should know.

You pay a real estate company based upon performance. The higher the price they can get for your house, the more they are paid. But where do the fees actually go? Let’s break it down with this example. First what you pay for real estate services is negotiable between you and your broker. For our example lets say that your house is selling for $100,000, and the commission you agreed to pay the broker is 6% or $6,000.

If the house sold through a cooperating broker through a multiple listing services, that $6,000 is split into two. $3,000 goes to the listing broker office and $3,000 goes to the selling broker office. Now, depending upon which side of the transaction the agent is on, it is customary that the $3,000 is split between the selling broker office and the selling agent. The bottom line is that the salesperson will only make 25% of the total commission or $1,500. There are other companies that have a different structure such as a 100% plan. What this means the salesperson does not share the $3,000 with the company, they keep 100%, however, the agent must pay a fixed rate to the real estate company for use of the facilities, telephone, fax machines, copy machines, etc. If the salesperson sells his own listing, the salesperson receives 100% of the $6,000. So when there is a price difference between you and your buyer, is it fair to ask the broker to pitch in on the difference? My suggestion is to ask the question to the real estate agent when you sign a listing agreement. In the real estate section of the newspapers, you hear bantered about that this person is a $1,000,000 production salesperson. We’ll, based upon the previous example, that would be ten $100,000 houses sold in a years time and their income would be around $15,000 per year. $15,000 is not a lot of money to live on. How much of their income would they dedicate to advertising and promoting your house?

If you did you job right negotiating should be easier than you think. This is where your preparation and planning will pay off. First realize that no one will pay your full list price unless you’re really lucky or you priced the home below fair market value for a quick sale. If you established value, you shouldn’t be too far apart in price. If you are, the buyer is looking for deal.

You have three choices in negotiating the contract.

The first is simply accept the buyers offer. Yeh!!

The second is to reject the offer. Reject the offer totally if there is a big difference in price.

The third is to counter the offer back to the buyer. If the buyer says, I’ll buy the house for $90,000 you can go back to the buyer and say $95,000. When you counter their offer, be certain that you stipulate when the counter offer expires. Give the buyer a couple of days to make up their mind.

If a buyer is serious, the process may go back and forth a couple of times.

Some things a buyer may bargain for:

1. Pieces of personal property such as a stove or refrigerator
2. Discount points on their mortgage. A discount point is 1% of their mortgage amount. If the buter asks you to pay their points, be sure that you’re getting a better price for your house.

Any contract that you sign, be certain that there is either a rider or paragraphs that the contract is subject to the approval of the attorneys! This will protect your legal interest!