CENTRAL MA “FSBO” SELLERS RIDE THE BUS (BUT PAY FOR A LIMO)

Once you have decided to sell your Central MA home, one of your first action items is to

For Sale By Owner Real Estate Sign and Beautiful House.
“© Andy Dean/Adobe Stock”

recruit a good REALTOR®. About 90% of sellers choose a licensed REALTOR® to head up their effort, not just because it’s the popular thing to do, but because the alternatives are few. You could recruit a business person from some other discipline, but few do that. Most in the minority group decide to do it all themselves; to go the FSBO route: “For Sale By Owner.”

The reason for settling on this choice is usually a dollars and cents one: to eliminate the real estate commissions. Any home sale in Central MA is a weighty transaction, so pocketing that percentage looks like a businesslike decision. It usually does have financial ramifications, but not necessarily the kind that the FSBO seller was hoping for:

  1. Statistics tell us that fewer than 3% of home buyers hear about their ultimate purchase directly from the seller. Missing out on 97% of prospective buyers greatly diminishes the chance that more than one party will compete to buy the property.
  2. The longer a property lingers on the market, the lower its ultimate selling price is likely to be. Interviews confirm that only 1 in 8 FSBO sellers succeed in selling within their planned length of time…
  3. …and even fewer “get what they consider the right price.”
  4. Advertising expenses have to be paid by the seller. There is $5.95 for a front yard FSBO sign, plus $2.35 for the wooden stake that holds the sign up. If no additional advertising expenses are incurred, it means there is no advertising; with likely outcomes described in 1, 2, and 3.
  5. If the Central MA FSBO seller has regular job responsibilities, the time devoted to handling prospects and addressing the business and legal ramifications that accompany a residential real estate transaction can become costly distractions. High among the tasks past FSBO sellers rated most difficult was “understanding and
    Sale of real property
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    performing the paperwork.”

  6. The average price of a FSBO sale is 75% of one carried out by a professional.
  7. Even if a sale is accomplished, the premium gained may be less than anticipated. Since the buyer is likely to be represented by a buyer’s agent, the hoped-for savings are cut in half.

A positive financial result is the usual reason for most Central MA FSBOs; but too often it’s the opposite result of the one intended. You might say that the FSBO strategy should really only be attempted by those for whom money is no object. In effect, the vast majority of FSBOs who do sell get the satisfaction of selling without a pro but not the financial reward.

I suggest that you give me a call for a free consultation when it’s time to sell your own Central MA property!…..Realty Ace, LLC

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WHY PEOPLE USE A BUYER’S AGENT

A  huge-proportion of serious Central MA house hunters ultimately decide it makes the

Real estate agent shows details to customers
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most sense to team up with a real estate professional to get the job done. Worcester County buyers may begin the process of finding and buying their next home on their own, checking through the online listings or driving target neighborhoods to check out the “For Sale” signs, but the NAR® reports that 9 out of 10 of U.S. buyers will eventually use a real estate agent in their search process.

The most obvious motivation for that is because the buyer’s agent’s fee is paid from the seller’s proceeds. That alone could explain a 90% level of popularity. When you can benefit from a professional’s services at no cost to yourself, Central MA house hunters would have to think long and hard to come up with what the downside could possibly be. To run down the arguments that could explain how 10% might decide to pass up the buyer’s agent service, I looked for the most common arguments against the grain.

Here are the Top Four, presented in no particular order. (Since I definitely do have an interest in this fight, I’ve also included some counterarguments):

  1. Distrust. Something for nothing? A free lunch? Common sense teaches the same lesson, always and forever: THERE’S NO SUCH THING AS A FREE LUNCH! (Counter: the service is not free: the seller pays).
  2. Independent Spirit. Some people know that they work and think better when they take sole responsibility. They may have been misled by “experts” too many times and may regret not relying upon their own instincts. After all, Americans are individualists by nature: they are at their best using their own native ingenuity to solve problems. (Counter: a substantial portion of the process of purchasing a home in Central MA requires mastering technical legal and timing requirements. Although a buyer can take the time to learn about all of them, since their buyer’s agent has already handled them successfully many times, it’s wasted effort. IOW, this is a wheel that doesn’t need to be reinvented).
  3. Commitment. If asked to okay an agreement that spells out the ground rules for working with a buyer’s agent, it’s as if a commitment is being forced prematurely.
    Happy girl given house key - indoor
    “© Creativa Images/Adobe Stock”

    After all, who knows for certain that the right area house at the right price is even out there? It just feels like putting the cart before the horse. (Counter: this is never a commitment to buy, just an agreement for how the search and commission will be handled if a suitable home is found and purchased. The buyer can make sure the arrangement can be severed without penalty if the service is not satisfactory).

  4. Motivation. Since a buyer’s agent will profit from any sale they’ll try to sell me anything. (Counter: Every buyer’s agent is legally and ethically duty-bound to represent their client’s interests—plus, since their entire career is utterly dependent on their reputation, their interests align).

Whenever I represent any buyer, my motivation is 100% that of helping them reach their desired outcome. Reaching that goal—finding the right Central MA home, then negotiating and closing at the right price is the way I keep the phone ringing. See for yourself by giving me a call!…..Realty Ace, LLC

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NEW CONSTRUCTION NUMBERS: NOW VERSUS 2005

New Construction Numbers: Now Versus 2005 | Simplifying The Market

New Construction Numbers: Now Versus 2005

There is some thinking that the pace of the housing recovery is unsustainable and that we may be heading for another housing bubble. However, Jonathan Smoke, the Chief Economist of realtor.com explains the basic difference between 2005 and today:

IS THE CURRENT PACE OF HOME SALES SUSTAINABLE?

Is the Current Pace of Home Sales Sustainable? | Simplifying The Market

Is the Current Pace of Home Sales Sustainable?

There are some experts questioning whether the current pace of residential home sales is sustainable. Are too many people buying homes like in 2004-2006? Are we headed for another housing crisis? Actually, if we look closely at the numbers, we can see that we are looking at a very healthy real estate market.

5 REASONS TO SELL THIS FALL

5 Reasons to Sell This Fall | Simplifying The Market

5 Reasons to Sell This Fall

School is back in session, the holidays are right around the corner, you might not think that now is the best time to sell your house. But with inventory below historic numbers and demand still strong, you could be missing out on a great opportunity for your family.

14,767 HOMES SOLD YESTERDAY…DID YOURS?

14,767 Homes Sold Yesterday… Did Yours? | Simplifying The Market

14,767 Homes Sold Yesterday… Did Yours?

There are some homeowners that have been waiting for months to get a price they hoped for when they originally listed their house for sale. The only thing they might want to consider is… If it hasn’t sold yet, maybe it’s not priced properly.

INCLUDING A HOME WARRANTY CAN CINCH CENTRAL MA SALES

When last week’s surprising news (on the plus side) about consumer confidence was

Index Measuring Level Rating Score Comparing Periods Performance
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announced, it was one more sign Central MA homeowners might have felt nudging them in the direction of putting their home on the market. U.S. confidence rose to an 11-month high in August—a turnaround from consumer blahs that had ruled during the first half of the year.

Even when there’s some time pressure to sell your Central MA home, one snag that can stall the decision—especially for those with older homes—is the thought of the cost of bringing the place fully up to date. Even if the mechanicals (heating and cooling systems, plumbing and electrical) are actually in perfectly fine working order, it can seem as if potential buyers will be hard to convince that it’s the case. And if the appliances are veterans, even if they’re perfectly serviceable, potential sellers sometimes fear that prospects will shy away from the Great Unknown of costly dishwasher or clothes dryer breakdowns.

So it’s pretty good news that this is one concern that Central MA homeowners and their future customers can do something about. The doubt-remover is a home warranty—the kind of policy that helps shield against the cost of unexpected breakdowns. Massachusetts consumers can choose from a number of home warranty providers, each of whom offer varying levels of protection.

The home warranty companies provide a straightforward proposition: it is a service contract, usually a year in duration that promises to pay if a major system or covered appliance should break down due to normal wear and tear. Some high-end policies offer complete coverage for repairs—or even full replacement if necessary. More inexpensive home warranties may provide less comprehensive coverage or require the use of specified repair services.

Once it’s been determined that the incremental cost is a worthwhile investment, it’s important to read through the previsions about what is covered—and to remember that systems and appliances have to be in good working order at the time the policy is issued. Some of the items commonly included can be the plumbing and electrical systems, furnaces and heating ducts, water heaters, pumps, dishwashers, garbage disposals, cooking appliances, refrigerators, washers and dryers—sometimes, even swimming pools. You can see why checking the scope of coverage is critical for determining the choice of contracts.

Lately, home warranties have grown in popularity—possibly because of timing considerations. H.U.D. says it’s because the protection they offer home buyers comes Buyer 13 mo warranty-1during the critical period immediately following purchase—a time when there is often less extra emergency cash on hand. That can be a critical reassuring factor for Central MA home buyers.

Even more convincing are the statistics from the National Home Warranty Association. If it’s as true for Massachusetts sellers as it is nationally, it’s eye-opening. The NHW finds that when a home warranty is provided as part of the sale, it can help a home sell up to 50% faster.

THIS could come as welcome news if you’ve been undecided about whether this fall will be an opportune time to sell. Even if you’re on the fence, give me a call!…..Realty Ace, LLC

P.S. For a limited time we are offering our buyer and seller clients a complimentary 13 month Home Warranty (conditions apply, call for details!)

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HOW SUPPLY & DEMAND IMPACTS THE REAL ESTATE MARKET

How Supply & Demand Impacts the Real Estate Market [INFOGRAPHIC] | MyKCM

Some Highlights:

  • The concept of Supply & Demand is a simple one. The best time to sell something is when supply of that item is low & demand for that item is high!
  • Anything under a 6-month supply is a Seller’s Market!
  • There has not been a 6-months inventory supply since August 2012!
  • Buyer Demand continues to outpace Seller Supply!

Ed Triboski
Designated REALTOR
CRS, GRI, CBR, e-PRO, BPOR, LMC, BROKER
Realty Ace, LLC
(508) 365-4064
“WE PUT THE REAL IN REALTY!” Realty Ace, LLC is dedicated to providing buyers and sellers with the most competent and professional representation possible while helping them achieve their real estate goal of buying or selling real estate.

SEEKING CLARITY ON CENTRAL MA’s FUTURE HOME LOAN INTEREST RATES

Here’s a piece of incoming information that crossed my screen, an item that related to the

Interest Rates cloud word with a blue sky
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possible direction in which Central MA home loan interest rates might be heading.

The first came from a big national listing aggregator. It seems that once this outfit gets the idea that you are interested in homes, they conclude that it’s your wish to establish an ongoing relationship. They then display all the energy and persistence a large corporation can muster to share their thoughts about this and that. They will continue to email you with regularity until you call, “halt”.

Along with other communications, they sometimes send attention-grabbing questions to everybody on their list, then share the answers from the “community” (that is, everyone who hasn’t begged off yet). Here’s an example question: “Is it better to buy a house right now or wait until 2017?” Since Worcester County’s current home loan interest rates are one of the prime reasons today’s market is so affordable, the posted responses would surely be relevant.

Some were confused (“When interest rates rise, this puts pressure on affordability, which then slows rising house prices…then is the best time to buy”). This commenter apparently hadn’t taken into account the fact that higher home loan interest rates mean higher mortgage payments; definitely not a more attractive time to buy.

A crank in Upstate New York complained that houses around those parts were too spooky and expensive (“housing and all these old, some hunted houses costs easily over 500K”).

Other answers were more philosophical (“it is ALWAYS a personal matter whenever a large purchase is contemplated”). Some claimed dubious expertise (“BUY NOW>>>NEXT YEAR THE PRICE WILL BE GOING EVEN HIRE”). Others were observant (“You should go to grammar school and get some spelling lessons. Seriously”).

mortgage interest rates
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All in all, most did subscribe to the majority view that low home loan interest rates make the current environment genuinely inviting. One writer was defiantly emphatic (“Buy now; waiting costs you more for interest rate and purchase price”).

Answers like that (there were lots of them) made the second source of home loan interest rate news all the more relevant. It came from a source that should supply the most reliable clues to the future direction of rates: the financial press. Unfortunately, after reading many different takes on the breaking news, clearness was in even shorter supply.

Anyway, continued low home loan interest rates could mean smooth sailing for the Central MA’s residential market. And another good reason to give me a call. Come to think of it, if the opposite happens, it’s also a good reason!…..Realty Ace, LLC

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