Myths abound regarding real estate; this is my attempt to clear up a few of these.
Myth #1. It is better to take a home off the market during the Christmas holidays. Having a home on the market is problematic anytime, but it presents additional challenges during this time of year. Family visitors, decorations and even baking cookies can upset plans to keep the home in perfect condition. If you put these things together, however they can actually have a positive influence on your ability to sale. The buyers braving the weather and taking time away from their own families are the ones that have to make a quick decision. You won’t be bombarded by people just looking. Your home will be seen by the people ready to buy. Buying a home is partly an emotional experience. The decorations, the sounds of Christmas and the aroma of fresh baking can only add to heightening that emotional experience. A house is not going to sell if it is not on the market!
Myth #2. Buying a home out of foreclosure is always a bargain. It is only a bargain if you have done your research. There are many companies that charge for lists of foreclosures and will even represent you at the auction. You can, however, access lists of foreclosures on the King Co Web site or in local newspapers. Access to many of these properties is problematic. Many are not open to the public and if they are one can come in contact with an uncooperative owner.
Many, if not all, foreclosures are in need of repair. If you don’t have the opportunity to see the inside, you will have to estimate the cost of repairs. It is a good rule to only bid 70% of the market value. You will have to rely on your agent to provide those statistics.
There is a hidden danger that most buyers are not aware of. These homes are sold as is. Liens may be on the property and will follow the sale. You may have to pay them off before receiving clear title.
These are but a few of the things that buyers must consider. Are there “deals” to be found at auction? Absolutely. But, the real deals are found by those who have done the research.
Myth #3. Short sales are always a bargain. When we first saw a rise in the numbers of short sales, banks were willing to take their losses and the buyer got a good deal. With so many out there, banks have heightened their expectations and raised the bar on the price they will accept. According to the Northwest Multiple Listing Service (NWMLS), 123 bank or real estate owned homes sold in the last three months on Mercer Island.
Days on Market
No of listings
47Price Reductions House Condo Both Avg. Days on Market (Sept-Dec) 84 134 92 % Homes with Reductions 40.7% 64.7% 44.4% Avg. # Of Reductions 2 1 2 Total Avg. % Reduction 5.7% 9.6% 8.3%
There were more than 500 non bank owned homes that sold. This number includes short sales. NWMLS lists the median percent of list price to sale price as 93.8 percent in October, the most recent month available. Of course, there were exceptions to this, but it is clear that sellers as well as banks are discounting prices a similar percentage. These statistics should help you determine if you are really getting a deal on a short sale.
Myth #4. All real estate agents are equal. Only real estate professionals who are members of the National Association of Realtors® can call themselves Realtors®, use the Realtor® logo and are entitled to any educational designations provided by the Association. So, what does this mean for the consumer?
Realtors must adhere to a strict Code of Ethics which is based on professionalism and protection of the public.
How does the Code of Ethics affect every day real estate practices?
If a REALTOR® represents you, whether you are buying or selling a home, you can count on that REALTOR® to:
1. Be honest with all parties in the transaction – not just with you, as his or her client, but also with the other real estate practitioner and his or her clients..
2. Put your interests ahead of his or her own, at all times.
3. Disclose all pertinent facts regarding the property and the transaction to both buyer and seller.
4. Be truthful in all communications with the public. This ensures that the public understands the REALTOR®’s experience and can make an informed decision when choosing real estate representation.