Real Estate Information Archive

Blog

Displaying blog entries 1-10 of 10

Home Sellers - How to Set the Right Price for Your Home

by Melissa Thompson


When you decide to sell your house it’s easy to get overwhelmed with all the details you need to think about.  The best thing to do is take things one step at a time. One thing that you will have to do is set a price for you home.  Deciding how much you want to ask for your home is complicated.  As the owner, the value you place on your home may be different that the value a potential buyer places on it.  You not only have a financial investment in it, but also and emotional one.  But when buyers think of value, they are thinking primarily about price.  The asking price for your property can attract buyers, or it can turn them off completely. A home that is not priced right can sit on the market for a long time, which can lead potential buyers to think there is something wrong with it.  The first step toward determining the right price for your home is to hire an experienced, professional Realtor who can use their expertise and knowledge of the market to assist you.

Working with your Realtor is crucial.  But it is also vital that you have a clear understanding of what your home is worth.  Learning about your home’s fair market value will help you evaluate the price your Realtor recommends.  Remember that you and your Realtor are a team and together you can decide on a price that will be profitable for everyone.

The first thing to do when trying to determine the right price for your home is to do some research. You can use an online  Estimating Tool  to plug in your address and find approximately how much your house is worth. They base their estimates on your home’s square footage and real estate data they have collected, such as recent home sales in your local market. But it’s important to remember that these results are very general and do not speak to your specific situation.  If the online estimate does not align with your Realtor’s advice, lean toward your Realtor’s suggested price. 

Another important aspect to consider when pricing your home is how it compares to other similar homes in the area.  Your Realtor will likely run the average sales prices of at least three Comps to assess your home’s value.  There are several factors that go into choosing “comps”. They are: age, location, square footage, and number of bedrooms and bathrooms. Your Realtor will look at the difference between each comp’s listing price, and the price at which it sold. Then there will be research into price reductions and why they happened, if relevant.  Meanwhile, your Realtor will also rely on their own knowledge of the local market.  When selecting comps, your Realtor will generally look for properties that sold in the previous three months, within a one-mile radius of your home. In addition, you will want to figure out what your competition is. So, your Realtor will check out properties that are currently for sale in your area to find out how your home compares to them. 

Understanding the current real estate market in your area will also have a large impact on your pricing strategy.   If you’re in a Seller's Market, that means demand from buyers is high and the number of homes on the market is low. In this market, you may be able to price your home slightly higher than market value. However, if it’s a Buyer's Market, buyers are at an advantage and you might have to price your home slightly below the market value to entice buyers. Your Realtor can help you navigate the current market in your area so that you price your home right.

If you are in the market to buy or sell a home in the Memphis area, contact professional Realtor, Melissa Thompson, and let her help you with all your real estate needs. Give her a call at 901-729-9526 today!

Memphis Real Estate Market Stats

by Melissa Thompson

How Much Do You Need to Make to Buy a Home in Your State?

by Melissa Thompson

It’s no mystery that cost of living varies drastically depending on where you live, so a new study by GOBankingRates set out to find out what minimum salary you would need to make in order to buy a median-priced home in each of the 50 states, and Washington, D.C.

States in the Midwest came out on top as most affordable, requiring the smallest salaries in order to buy a median-priced home. States with large metropolitan areas saw a bump in the average salary needed to buy with California, Washington, D.C., and Hawaii edging out all others with the highest salaries required.

Below is a map with the full results of the study:

GoBankingRates gave this advice to anyone considering a home purchase,

“Before you buy a home, it’s important to find out if you can afford the monthly mortgage payment. To do this, some financial experts recommend your housing costs — primarily your mortgage payments — shouldn’t consume more than 30 percent of your monthly income.”

As we recently reported, research from Zillow shows that historically, Americans had spent 21% of their income on owning a median-priced home. The latest data from the fourth quarter of 2017 shows that the percentage of income needed today is only 15.7%!

Bottom Line

If you are considering buying a home, whether it’s your first time or your fifth time, let The Melissa Thompson Team help evaluate your ability to do so in today’s market! 901-729-9526

By: KCM Crew

View our Video Blog

A New Housing Bubble Forming…Not Before 2024!

by Melissa Thompson

A recent report by CoreLogic revealed that U.S. home values appreciated by more than 37% over the last five years. Some are concerned that this is evidence we may be on the verge of another housing “boom & bust” like the one we experienced from 2006-2008.

Recently, several housing experts weighed in on the subject to alleviate these fears.

Sean Becketti, Freddie Mac Chief Economist

 “The evidence indicates there currently is no house price bubble in the U.S., despite the rapid increase of house prices over the last five years.”

Edward Golding, a Senior Fellow at the Urban Institute’s Housing Finance Policy Center

 “There is not likely to be a national bubble in the way that we saw the first decade of the century.”

Christopher Thornberg, Partner at Beacon Economics

 “There is no direct or indirect sign of any kind of bubble.”

Bill McBride, Calculated Risk

 “I wouldn’t call house prices a bubble.”

David M. Blitzer, Chairman of the Index Committee at S&P Dow Jones Indices

 “Housing is not repeating the bubble period of 2000-2006.”

A recent article by Teo Nicolais, a real estate entrepreneur who teaches courses on real estate principles, markets, and finance at Harvard Extension School concluded that the next housing bubble may not occur until 2024.

The articleHow to Use Real Estate Trends to Predict the Next Housing Bubble, looks at previous peaks in real estate values going all the way back to 1818. Nicolais uses the research of several economists. The article details the four phases of a real estate cycle and what defines each phase.

Nicolais concluded his article by saying:

“Those who study the financial crisis of 2008 will (we hope) always be weary of the next major crash. If George, Harrison, and Foldvary are right, however, that won’t happen until after the next peak around 2024. 

Between now and then, aside from the occasional slow down and inevitable market hiccups, the real estate industry is likely to enjoy a long period of expansion.”

Bottom Line

The reason for the price appreciation we are seeing is an imbalance between supply and demand for housing. This has created a natural increase in values, not a bubble in prices.

Let’s the expert’s at The Melissa Thompson Team help you with all your Real Estate needs. 901-729-9526 or Melissa@YourKeyTomemphis.com. 

By: KCM Crew

YOUR HOMESEARCH STARTS HERE            FIND OUT WHAT YOUR HOME IS WORTH  

2 Ways to Get the Most Money from The Sale of Your Home

by Melissa Thompson

Every homeowner wants to make sure they maximize their financial reward when selling their home. But how do you guarantee that you receive the maximum value for your house?

Here are two keys to ensure that you get the highest price possible.

1. Price it a LITTLE LOW 

This may seem counterintuitive, but let’s look at this concept for a moment. Many homeowners think that pricing their homes a little OVER market value will leave them with room for negotiation. In actuality, this just dramatically lessens the demand for your house (see chart below).

Instead of the seller trying to ‘win’ the negotiation with one buyer, they should price it so that demand for the home is maximized. By doing this, the seller will not be fighting with a buyer over the price but will instead have multiple buyers fighting with each other over the house.

Realtor.com gives this advice:

“Aim to price your property at or just slightly below the going rate. Today’s buyers are highly informed, so if they sense they’re getting a deal, they’re likely to bid up a property that’s slightly under priced, especially in areas with low inventory.”

2. Use a Real Estate Professional

This, too, may seem counterintuitive. The seller may think they would make more money if they didn’t have to pay a real estate commission. With this being said, studies have shown that homes typically sell for more money when handled by a real estate professional.

study by Collateral Analytics, reveals that FSBOs don’t actually save any money, and in some cases may be costing themselves more, by not listing with an agent.

In the study, they analyzed home sales in a variety of markets in 2016 and the first half of 2017. The data showed that:

“FSBOs tend to sell for lower prices than comparable home sales, and in many cases below the average differential represented by the prevailing commission rate.”

The results of the study showed that the differential in selling prices for FSBOs when compared to MLS sales of similar properties is about 5.5%. Sales in 2017 suggest the average price was near 6% lower for FSBO sales of similar properties.

Bottom Line

Price your house at or slightly below the current market value and hire a professional. This will guarantee that you maximize the price you get for your house.

Let’s get together and find out how much your house is worth!  901-729-9526 or Melissa@YourKeyTomemphis.com.

By: KCM Crew

YOUR HOME SEARCH STARTS HERE            FIND OUT WHAT YOUR HOME IS WORTH  

Housing Prices are NOT Heading for Another Crash

by Melissa Thompson

As home values continue to increase at levels greater than historic norms, some are concerned that we are heading for another crash like the one we experienced ten years ago. We recently explained that the lenient lending standards of the previous decade (which created false demand) no longer exist. But what about prices?

Are prices appreciating at the same rate that they were prior to the crash of 2006-2008? Let’s look at the numbers as reported by Freddie Mac:

The levels of appreciation we have experienced over the last four years aren’t anywhere near the levels that were reached in the four years prior to last decade’s crash.

We must also realize that, to a degree, the current run-up in prices is the market trying to catch up after a crash that dramatically dropped prices for five years.

Bottom Line

Prices are appreciating at levels greater than historic norms. However, we are not at the levels that led to the housing bubble and bust.

Contact your local expert’s at The Melissa Thompson Team 901-729-9526 or Melissa@YourKeyTomemphis.com for all your Real Estate needs!

 

By: KCM Crew

America Needs Your House!!

by Melissa Thompson

The biggest challenge in today’s real estate market is a lack of housing inventory. How big of a challenge is the housing shortage? Here are what four industry economists are saying on the issue (emphases added):

Mark Fleming, First American’s Chief Economist

“The underlying fundamental issue is an overwhelming lack of supply… The supply of newly constructed homes is also sagging, adding to the supply challenges. Over the last eight years, housing demand has increased by 5.9 million, but the net new number of housing units has only increased by 3.5 million.”

Svenja Gudell, Zillow’s Chief Economist

“Everyone has been talking about tight inventory but I think we are OK calling it a straight up inventory crisis at this point. We just don’t have enough homes.”

Sean Becketti, Freddie Mac’s Chief Economist

“House prices today are higher than they were at the peak in the summer of 2006, near-record-low mortgage rates have boosted housing demand, and sales volume is robust. The spoiler is the lean inventory of houses for sale.”

Lawrence Yun, National Association of Realtors’ Chief Economist

“Listings in the affordable price range continue to be scooped up rapidly, but the severe housing shortages inflicting many markets are keeping a large segment of would-be buyers on the sidelines.”

Bottom Line

If you are considering selling your house soon, now may be the time to get it on the market. The lack of competition could lead to a faster sale at a higher price.

Contact your local expert’s at The Melissa Thompson Team at 901-729-9526 or Melissa@YourKeyTomemphis.com to find out how much your home is worth

 

By: KCM Crew

Home Prices Up 6.64% Across the Country!

by Melissa Thompson

Some Highlights:

  • The Federal Housing Finance Agency (FHFA) recently released their latest Quarterly Home Price Index report.
  • In the report, home prices are compared both regionally and by state.
  • Based on the latest numbers, if you plan on relocating to another state, waiting to move may end up costing you more!
  • Alaska & West Virginia were the only states where home prices are lower than they were last year.

​​Contact your local expert’s at The Melissa Thompson Team 901-729-9526 or Melissa@YourKeyTomemphis.com for all your home buying and home selling needs!

By: KCM Crew

The Past, Present & Future of Home Prices

by Melissa Thompson

The Past, Present & Future of Home Prices | Keeping Current Matters

CoreLogic released their most current Home Price Index last week. In the report, they revealed home appreciation in three categories: percentage appreciation over the last year, over the last month and projected over the next twelve months.

Here are state maps for each category: 

The Past – home appreciation over the last 12 months

The Past, Present & Future of Home Prices | Keeping Current Matters

The Present – home appreciation over the last month

The Past, Present & Future of Home Prices | Keeping Current Matters

The Future – home appreciation projected over the next 12 months

The Past, Present & Future of Home Prices | Keeping Current Matters

Bottom Line

Homes across the country are appreciating at different rates. If you plan on relocating to another state and are waiting for your home to appreciate more, you need to know that the home you will buy in another state may be appreciating even faster.

If you are debating listing your home for sale, call me 901.729.9526, I can help you determine your next steps. Visit my website for a quick estimate of how much your house is worth!

 

The Main Reason You Should Not Wait to Buy…

by Melissa Thompson
 

The Main Reason You Should Not Wait to Buy | Keeping Current Matters

The Joint Center for Housing Studies at Harvard University recently released their 2015 State of the Nation’s Housing report. The report concentrated on the challenges renters in this country are facing because of the diminishing supply of quality rental units and dramatically escalating rents.

However, there was also information buried within the report that revealed that now is definitely the time to buy your first home or move-up to the home of your family’s dreams. With home prices still below peak values and mortgage rates still near historic lows, the monthly mortgage payment on a median priced home is less than at almost any time in the last 25 years.

Here is a graph which helps visualize the data from the report:

Median Mortgage Payment | Keeping Current Matters

Bottom Line

With home prices increasing and mortgage rates projected to increase, now is the time to buy.

 

Displaying blog entries 1-10 of 10

Syndication

Categories

Archives