NEW YORK - Are you looking to sell your home but worried about selling into the slumping housing market? By all accounts, the market is bad.
A recent report out by the National Association of Realtors showed that sales of homes fell for the eighth time in the last nine months. Meanwhile, the supply of unsold single-family homes has risen to the highest level in 23 years. Given this environment, what is a homeowner looking to sell to do?
Though certainly not an easy feat, there are measures you can take to improve your chances of success. From Consumer Reports, here are five tips on how to sell your home in a difficult market:
Pick the right broker. Look for local agents who are listing, marketing and selling in your community even if the market is slow.
Ask several of them to make a "listing presentation" to discuss your home's value, justify their numbers and explain how they would market your property. Once you decide on a broker, you have three types of listing options. In an open listing, you reserve the right to sell the home yourself and not pay a commission, but you also allow one or more brokers to offer the property. With an exclusive-agency listing, you have one broker but reserve the right to sell the property yourself. An exclusive-right-to-sell listing gives only one broker the right to represent you during the listing term and guarantees the broker a commission. Most Multiple Listing Services will post exclusive-agency and exclusive-right-to-sell listings.
Understand the real marketplace. To negotiate effectively, you need to know up-to-the-minute sale prices - not just what your neighbor's house sold for last year - and the deal-making behind them. For example, two homes may each have sold for $400,000, but if one owner gave a 3 percent credit for deck repair and a new furnace, that's a $12,000 reduction. Your agent should be knowledgeable about the details of sales in your area and be nimble enough to revise the marketing plan for your home to reflect changing conditions.
Sweeten the deal. Sellers are reportedly offering some unusual sales incentives - plasma TVs, cars, boat slips, vacations and golf carts - but cash may still be king. For example, some sellers have agreed to pay condo maintenance fees for the buyer. Other ideas include covering moving expenses or a month's mortgage payment.
Be flexible on the deposit. To "bind" a deal, the buyer should put down a deposit (separate from the down payment), which varies widely depending on the local market. You'd like the biggest deposit you can get, but in a slow market you may have to settle for less.
Monitor and update your listing. If it's April, you don't want the photo of your house on the Multiple Listing Service displaying a snowman on the lawn. An out-of-season picture is a dead giveaway that your home has been on the market for a while. And with many buyers doing their first "look-see" on the Internet, the quality of the photos is paramount too.