The old rule of pricing your home high because you can always come down doesn't apply in this declining market. Studies show that you'll get more for your home if it is priced right the first time.
The trick is to be realistic about the current market value of your home. According to a recent Associated Press report, there is such a glut of available homes on the market right now that it would take 9.6 months to sell the current supply of homes. Waiting several months to sell a home could leave many recession-plagued sellers in financial distress.
For example, a home with a $250,000 mortgage at an interest rate of 6.5 percent would accrue approximately $15,600 in mortgage payments over a 96-month period. This could be a real financial burden for many.
So what are the rules in this current real estate market? Dan Steward, president of Pillar To Post, North America's leading provider of home inspection services, offers these three tips:
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• Have a home inspection done before listing the house. This lets sellers identify any problems, and the seller can decide whether to fix them. These early inspections make it easier to sell your home at the highest valuation. Usually, for every repair a home buyer finds, he or she will typically ask for double or triple that in a price reduction. For example, paying $5,000 for a roof repair is a lot more enticing than losing $15,000 in the sale. In addition, having work done before a house is listed leaves a seller with a maintenance checklist to pass on to the potential buyer that itemizes what has been repaired and what still needs to be repaired.
• Houses that look good, are well maintained and tastefully decorated sell quicker. Put yourself in the buyer's shoes. With so many houses to choose from, a serious buyer doesn't have to settle for a fixer-upper to get a great price. Ask your real estate agent for advice on what cosmetic improvements to make.
• Always be ready to adjust your price. If your home isn't attracting buyers in the first month that it is listed, that's when you should think about adjusting your asking price.