Experience Matters – Questions to Ask Before Selling

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Our clients have presented us with many unique situations when selling their Arizona Homes. Whether moving out-of-state to take a new job, hoping to buy a bigger home with a pool, needing to be in a new school district, or looking to downsize to a home that is more manageable, our clients all had something very important in common. Each had future plans – plans that depended heavily on how the logistics of the sale were handled and the financial results of the sale.

Marketing and Selling Homes is Serious Business.

A well-planned and executed sale of a home allows the homeowner to move forward with their next phase of life. However, mistakes may cost thousands of dollars and hours of stress when escrows are canceled. Nothing may be more important in the transaction than the knowledge and experience of the agent giving you advice. So, here are a few good questions for you to ask your agent:

  • What do you know about the area? At times, knowledge of the area can be the key to selling a home. Buyers that are new to the area need to know information about schools, movie theaters, shopping and more. An agent who lives in the area can help buyers identify how they will enjoy the area – and many times, the home will sell quicker.
  • How do you market my home? Believe it or not, some agents think that ordering a “for sale” sign and putting your home in the multiple listing service (MLS) is how to sell a home. This is only the beginning! Great agents should be able to deliver to you a written marketing plan tailored for the Phoenix Real Estate market along with success stories from using that plan.
  • How much are the costs of selling my home? In order to plan for the future all homeowners with Phoenix Homes for Sale need to know the amount of money they will have after the sale of the home. Great agents should be able to estimate the cost of real estate commissions, title fees, loan costs, repair costs, and property taxes.
  • When will the buyer’s loan be approved? Without loan approval, the sale of the home cannot close escrow. In tracking a lender’s process, a great agent should know how to use the LSU (Loan Status Update) form, what “PTD” conditions are, and what is the time needed for a lender to get loan documents to title after full loan approval. Being able to track the lender’s progress is essential for a seller to know whether they will close on time or not.
  • What is breach of contract and how do you handle this? In the Arizona purchase contract, the seller is unable to exit the contract while the buyer retains over five exits from the contract. However, if the buyer is in breach of contract, then the seller may exit the contract. Breach of Contract occurs when the buyer takes actions that are contrary to the written contract. This is a serious situation that experienced agents should have a plan to handle.

Do you want to learn more about how to make your home-selling process go smoothly? We would love to help with your transaction. Contact us at www.ThompsonGroupAZ.com or 602-753-0177.

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Marketing Your Home’s Location!

Location, Location, LocationThe name of the game in real estate is location. There’s a reason some say, “location, location, location” – because it is so important. When preparing a home for sale, agents typically are dealing with a whole lot of logistics and people. Managing painters, landscapers, handymen, stagers and photographers take up time – and, too often, marketing your home’s location gets overlooked. However, many home buyers are new to the area in which they’re looking and have lots of questions about your home’s location. If they are able to get excited about the location, they will make better offers!

Great amenities around your home may include award-winning schools, shopping centers, specialty stores, movie theaters, restaurants, community parks, community pools, and great freeway access. The more of these that you and your agent are able to present to a buyer, the better.

Another appealing factor in a location is proximity to great employers. If your home is near big employment centers or if big employers are moving into the area, those can be great avenues for marketing your home. Buyers prefer shorter commutes, so there should definitely be a plan to market this aspect to any job seekers in your area.

There can also be negatives to your location such as issues with the local schools, extra commute times to work, or proximity to harmful and/or noisy roads. Rather than ignore these, it is important to address them and come up with solutions that will work for the buyer. While actually fixing some location issues may not be possible, it is usually possible to find alternate solutions to satisfy a buyer.

Summing up: one of the most important skills a real estate agent will bring to a seller is the ability to market location. Do you want to learn more? Contact us at www.ThompsonGroupAZ.com or 602-753-0177 today!

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Selling for Top Dollar – Contract Strategy

Real Estate ContractThe day is here! You need to sell your home. The next steps are to find a real estate agent familiar with your neighborhood, put your home on the market, and negotiate a BIG sales price. You might not have seen the latest Arizona purchase contract. Filled with 10 pages of legal jargon and multiple addendums, the lack of understanding of the Arizona purchase contract is an easy way to give away thousands of dollars even though you may sell your home for Big $$$.  Here a few items to watch for that can affect your bottom line:

  • Buyer Loan Costs. Many buyers need help with the purchase cost and like to write offers asking for the seller to pay their loan costs. And if the overall contract sales price is right, paying the buyer loan costs might be well worth while. Generally, the request is made as 3% of sales price.  Initially that amount may not seem high. However, when considering a sales price of $200,000, 3% of sales price works out to be $6000 – not a small sum of money. Instead, consider offering a compromise: have the buyer pay only half of the loan costs or a set amount instead of a percentage of sales price.
  • HOA Transfer Fees. Did you speak with your home owners association (HOA) before listing your home? The amount your HOA will charge to transfer your home to a new buyer is great information to know. We have seen HOAs have charging in the range $500 – $2500 to transfer the property. With HOA transfer fees being a negotiable item, a seller may be able to pass this cost on to a buyer.
  • Home Warranty Costs. As a general rule, buyers of for most Arizona homes expect sellers to pick up the cost of a Home Warranty. The Home Warranty will cover the buyer for one year in case some of the working components in the house break. The home warranty also protects the seller from being pursued by a buyer who feels that an A/C unit, hot water heater, or other expensive item died prematurely. A typical, basic Home Warranty plan will cover most items and can be obtained for under $450. But watch out – some buyers will ask for plans that can cost twice this amount.
  • Appraisal. Did you and your real estate agent have a conversation about what price the property is likely to be valued by an appraiser? Will your home appraise for the sales price on the contract?  Sellers may accept contracts for sales prices that have no chance of being supported by appraisal.  Mr. Seller, beware!  The appraiser may submit an appraisal for thousands less than the contracted sales price. If the seller forgot that the purchase contract is subject to the appraisal, the seller may have packed up the house and secured a new place to live.  When the appraisal comes in below sales price, the seller is generally between the proverbial rock and a hard place. They’re forced to decide: “Do I accept the new sales price and take a financial hit or do I cancel this contract and try to sell the home again?” Keeping in mind that most sellers are moving for significant life reasons such as job transfer, bigger home or changes in lifestyle, the seller generally must accept the financial hit or give up on the timelines and main reasons for moving.

In most cases a little upfront planning will help net more money for sellers when the contract arrives. Do you have more questions? Contact us at (602) 753-0177 or www.ThompsonGroupAZ.com

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Selling for Top Dollar – Getting Tons of Exposure

Get Tons of ExposureThe day is here! You need to sell your home. The next steps are to find a real estate agent familiar with the Phoenix MLS, put your home on the market, and negotiate a contract. The #1 Rule in selling your home is to get your home Tons of Exposure. The more exposure you get for your home, the more potential buyers and the faster the sale and a higher sales price for your home. Seems simple, right? Well here are a few things to consider when going to market.

  • Focus Local and Worldwide. Recently, our team got a call from another state about one of our listings. The buyer — who happened to have cash for a purchase — found one of our listings on the internet. Unable to find a local Phoenix Real Estate agent, the buyer called us directly to purchase the home. The buyer said, “Your home is beautiful.” While our seller took credit for the beautiful home, we took great pride in showcasing the home with our elite marketing plan.
  • Focus on the Internet. The internet has huge potential to market our listings, but also is very risky. While allowing agents to showcase a home’s best features, the internet can also make a home look very bad. Dark pictures, pictures of small rooms, pictures of the commode, and even the lack of pictures will dissuade buyers from looking at your home. The presentation of a home over the internet should entice a buyer’s interest to see more of the home by scheduling a showing.
  • Focus on the Phoenix MLS. The Phoenix MLS allows home owners and agents to add lots and lots of features. Important upgrades — like granite counters, RV gates, energy efficient upgrades, cul-de-sac lots, vaulted ceilings, etc. — are very important to buyers. And many buyers and buyer’s agents will search for these important upgrades on the internet and the MLS database. Every time a buyer searches for features and finds your home, the buyer is likely to want to see inside your home.
  • Don’t Forget Traditional Advertising. With i-phones, tablets, and many other tech devices, it may be easy to forget the traditional advertising. However, traditional advertising is still very successful for attracting buyers. Newsletter, Just Listed notices, and color flyers are still huge for getting the attention of buyers. While younger buyers under the age of 30 will start their search for a home on the internet, many older buyers will start their search with the newspaper or from items received in the mail. On a daily basis, many Phoenix Homes for Sale can be found in the local paper.

A great marketing plan includes aspects of all these items and any other ways of getting buyers to see your home. Remember, the name of the game is exposure, exposure, exposure. Do you have more questions? Do you want to learn more about this or other ways to get the most money from the sale of your Phoenix Arizona Homes? We can help! Contact us at (602) 753-0177 or info@ThompsonGroupAZ.com.

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Pricing Considerations for a Successful Home Sale

Pricing Considerations for a Successful Home SalePricing a home correctly is defined as pricing a home in a price range of comparable other homes sold in the last 3 to 6 months. A home priced more than 5% under the lowest sale may be considered under priced. A home priced more than 5% above the highest sale would be considered overpriced.

In considering a list price, you might want to think about…

  • Appraisal: What is the highest potential appraisal value of my home? One of the main reasons to price a home correctly is to avoid appraisal issues. Even when a seller sells a home above the market value, if the lender’s appraiser will not support the sales price value, the home will only close at a price the appraiser will support.
  • Comparative Market Analysis: Most real estate agents are able to perform a Comparative Market Analysis (CMA) when a current appraisal is not available. A comparative market analysis should give an accurate idea of how your home stacks up against comparable sales within a mile radius of your home. All comparable sales used should be no older than 6 months to give a correct approximation of the current market.
  • Pending Home Sales: Pending Listings or homes that are currently under contract waiting to close escrow may indicate where the market is headed. If pending properties are selling for less than previous closings, then the market is declining. If pending properties are higher than previous sales then the market is appreciating.
  • Active Home Sales: How many homes are active in the MLS in your area? This is important, because this is a list of your competition who are seeking to steal your buyer! The winner gets to move, and the loser gets to wait for the next buyer.
  • Location, Conditions, and Terms: Keep in mind that if your home has issues in any of these areas, buyers will want a discount the price to deal with the issue. If you are able to fix the issue up front, your home is much more likely to return market value and to sell quicker!

Do you want to learn more about this or other ways to get the most money from your sell? Contact us at (602) 753-0177 or www.ThompsonGroupAZ.com.

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Capital Gains Tax on Your Home Sale

Capital Gains Tax on Real EstateMost of our home sellers are making nice profits on the sale of their homes. Unfortunately, some sellers will need to pay the IRS on those profits. Although that is not normally the case, it does not hurt to review this potential problem before putting your home on the market.

The Great Exclusion

If a homeowner lived in his house for 24 months out of the last five years, he is entitled to exclude $250,000 of the profits from the sale – or $500,000 for married homeowners. The 24-month period does not need to be consecutive, as long as you have lived in and owned the home for at least two years.

The “2 of 5”exclusion may be used each time you sell or exchange your primary home. Generally, the exclusion may be claimed only once every two years, although exceptions do exist.

Gotchas Exist!

In a recent listing appointment our homeowner decided that the time was right to put a home on the market. Our seller moved out of state and rented the home for several years. Our seller realized that he was now making a profit, but was unaware of the requirement to live in the home for two of the last five years. The homeowner consulted his CPA/tax advisor before moving forward with the sale and decided the profit was big enough to pay the capital gains tax.

On another recent seller conversation, the seller had found a wonderful new home on an acre lot to purchase, but needed to sell his current home. The seller bought his current home only 18 months ago and would be making a nice profit on the sale. After consulting with a CPA, the seller decided to postpone the sale of his current home six months to avoid the capital gains tax.

As a standard part of business, Phoenix AZ Realtors are not experts on the ins and outs of capital gains taxes. For the best advice, consult a CPA or tax advisor.

Do you want to learn more about ways to control your selling costs and get the most money from the sale of your home? Contact us at (480) 776-5214 or www.ThompsonGroupAZ.com.

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Jamie Thompson Qualifies for Senior Real Estate Specialist (SRES)

A few years ago, we received an introduction to working with a senior client moving from a house to an assisted living situation. Unfortunately, our senior client had significant health issues and our client’s home suffered from a lack of maintenance. Due to the number of needed repairs, our client’s home sold for significantly less value than could have sold for if in good shape.

NAR-SRESSo, we went back to the drawing board and came up with a new process that caters to the needs of seniors and their transition to assisted living. Our sales process helps seniors downsize, clear, and prepare the home for sale and manage the contractors needed during the process. The goal is to enable our senior clients to sell their homes at the top of the market for the best value.

In May, Jamie Thompson completed all requirements for Senior Real Estate Specialist (SRES). The SRES is rigorous education focused on developing understanding of needs of the 50+ demographic. The SRES Council is known to have knowledgeable, passionate members that serve consumers in the 50 and older market.

 

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Contract Strategy Focused On Protecting Your Bottom Line

The day is here! You need to sell your home. The next steps are to find a real estate agent familiar with the MLS, put your home on the market and negotiate a contract. You might not have seen the latest Arizona purchase contract. Filled with 10 pages of legal jargon and multiple addendums, the management of the Arizona contract is an easy way to give away thousands of dollars through the sale of a home to a buyer. Here a few items to watch for that can affect your bottom line:

  • Buyer Loan Costs. With the current distressed market, many buyers like to write offers asking for the seller to pay their loan costs. And if the overall contract sales price is right, paying the buyer loan costs might be well worth while. Generally, the request is made as 3% of sales price, which initially may not seem high. However, when considering a sales price of $150,000, 3% of sales price works out to be $4500 – not a small sum of money. Instead, consider offering a compromise: have the buyer pay only half of the loan costs.
  • HOA Transfer Fees. Did you speak with your home owners association (HOA) before listing your home? The amount your HOA will charge to transfer the property to a new buyer is great information to know. In some situations, HOAs have charged $500 – $1500 to transfer the property. With HOA transfer fees being a negotiable item, a seller may be able to pass this cost on to a buyer.
  • Home Warranty Costs. As a general rule, buyers of homes in the Phoenix area expect sellers to pick up the cost of a Home Warranty. The Home Warranty will cover the buyer for one year in case some of the working components in the house break. The home warranty also protects the seller from being pursued by a buyer who feels that an A/C unit, hot water heater, or other expensive item died prematurely. A typical, basic Home Warranty plan will cover most items and can be obtained for under $350. But watch out – some buyers will ask for plans that can cost up to twice this amount.
  • Appraisal. Did you and your real estate agent have a conversation about what price the property is likely to be valued by an appraiser? Will your home appraise for the sales price on the contract? Over and over again, I see sellers accept contracts for sales prices that have no chance of being supported by appraisal. Many times, after about 15 days into the escrow, the appraiser may submit an appraisal for thousands less than the contracted sales price. With the seller having planned a move, packed up the house and secured a new place to live, the seller is generally between the proverbial rock and a hard place. They’re forced to wonder: “Do I accept the new sales price or cancel the move?” Keeping in mind that most sellers are moving for significant life reasons such as job transfer, bigger home or changes in lifestyle, the seller generally must accept the financial change or give up on the reason for moving.

In most cases a little upfront planning will help net more money for sellers when the contract arrives. Asking the right questions and getting the right information can be crucial. Do you have more questions? Contact us at (480) 776-5214 or www.ThompsonGroupAZ.com.

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Best Renovations for Improving Sales Price

Woman painting the walls.

Have you been out to see the builder model homes lately? If so, you may have noticed that builders have loaded tons of upgrades into the homes. The builders know that the look and feel of the home is super important to the buyer and if they get the buyers excited about the possibilities, then it will lead to more sales. As a homeowner and a potential seller someday down the road, getting buyers excited about your home will lead to a higher sales price! If you make a few upgrades to your home now, you will also get to enjoy the changes before you move. Now, don’t overspend on your improvements, but here are a few that can make a huge difference when you sell:

  • The Kitchen – The kitchen is where improvements go a very long way. New cabinets, counter tops, and appliances will add a lot of value. Don’t feel like you need to turn you kitchen into a gourmet kitchen! There are a lot of ways you can update your kitchen to the current trends on a budget. Keep in mind that giving your kitchen a cohesive contemporary look is the best way to add value to your home.
  • Landscaping – If your yard is feeling more like a jungle or desert than a place where kids would like to play, then it might be time to make a few changes! Whether you like desert landscaping or something a little greener, color and cleanliness is the key. Buyers are always looking for a yard that is well-kept, but that will also be fun to hang out in after work. Putting in a handful of plants will go a long way to dressing up your front or back yard. If a buyer can picture outdoor living and nightly barbeques, then you are on the right track.
  • Flooring – Updating your flooring is a great way to get a completely new feel throughout your home. New carpet, new tile floors, or hardwood floors can make a home feel newer and will appeal to younger buyers.
  • Paint – Without a doubt, a new coat of paint on the walls goes a long way to refreshing a home. Stay away from colors that are too bold and stick with colors that are more neutral. Earth tones and two-tone paint styles are the trend lately and appeal to younger buyers.
  • Bathrooms – In bigger homes, the master bathroom is a great area to look at spending more of your upgrade budget. However, in smaller homes, it can be hard to get your upgrade dollars back in bathroom remodels. As you look at remodeling your bathrooms, light and water fixtures are a great way to spruce up the area without overspending.

Do you have questions about remodeling? Contact us www.ThompsonGroupAZ.com or 480-776-5214 to get started.

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Is My Home Priced For This Market?

House For Sale PriceHas your home been on the market so long that the For Sale sign out front has begun to rust? At some point you probably began to ask yourself if your home may be overpriced for the market. Here are a few thoughts to consider in making that determination before your For Sale sign completely rusts away:

  • Comparables – Is your home priced right according to comparable properties? Comparable homes that have sold recently can give you a great idea of how well your home may appraise. Active, pending listings give a great indication of where the market is and what your competition is as you try to get that next buyer. Pricing considerably higher than the Active, Pending or Sold properties probably will impede a quick sale and extend your time on market.
  • Showings – How many showings are you getting each week? Has it been a few weeks since you last saw a buyer’s agent in your home? If so, you are probably overpriced. A good sign that you are priced right is getting 3-4 showings a week from qualified buyers working with real estate agents.
  • Market Changes and Activity – What is the market doing? Are interest rates higher or lower? What’s new on the local MLS? Are there a lot of bank owned properties or short sale properties in your area? Does your area attract lots of first-time buyers or move-up buyers? All great questions to ask when deciding on how high or low to price your home.
  • Do you really want the truth? Many times sellers and real estate agents just are not ready to be honest about the situation. It’s usually far more useful to understand the realistic factors necessary to accomplish a goal than conjecture about the price you hope or wish your home will sell. Assuming that’s your position, don’t be afraid to ask your real estate agent for the honest truth: What list price does my home need to be at in order to sell in the next 30 days? Just be prepared for the answer!

Rather not figure this out on your own? Our Phoenix AZ Realtors would love to help. Contact us at www.ThompsonGroupAZ.com or 480-776-5214.

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