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Hot home sellers market

Selling Your Home in a Hot Market

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Right now, the real estate market in the area for sellers has never been stronger. Low inventory and super low interest rates for mortgages for buyers is driving prices higher. Sellers may think that a “hot” market means more money for their home. In many instances, a hot market does indeed mean a faster sale at or above asking price. However, there are some pitfalls that a seller in a hot market needs to be aware of before putting their home on the market.

A Clean and Well Maintain Home Sells For More

Your home if selling in a hot market will always do better when it shows well. Getting the home ready and cleaned for the market matters. If you want to attract multiple offers on your property right after listing it, prepping and a deep clean is probably the best way to make that happen. In a hot market, buyers need to move quickly and are driven by first impressions and emotions. There is no better way to make someone fall in love with your house than to make it shine.

Your home doesn’t have to be perfect in a hot market. One of the “lucky” aspects of a hot market is that outdated or quirky homes sell more quickly than they otherwise would. However, it doesn’t mean more money, it just means buyers become more willing to overlook cosmetic or dated homes and may even be more willing to accept pricey fixes such as an old roof or leaky windows. Seller’s should be aware that buyers often are pushing the limits of the budget they have for home. Pre-sale inspections can go a long way to help buyers see the quality and condition of your home as well as not get surprised after they get into contract.

Sell Better with Inspections and Reports for Buyers

If you as the seller appear completely prepared to sell, a buyer will feel more confident making a quick-closing offer. There is no reason not to showcase the home in the state and condition that it is. You want to assure buyers there are no surprises after they make an offer. Because properties in a hot market tend to sell quickly and have shorter contract deadlines, you need to be prepared to present all relevant documentation to potential buyers right away. Getting all the inspections done before listing your property so you can present an accurate picture to buyers from the get-go makes sense. Have your disclosure documents all prepared and ready to go before the house goes on the market. 

Be Prepared to Move Quickly

Hot markets see more buyers purchasing with cash or minimal financing than other markets. If you’re lucky, your buyer may not need to be approved for a loan, which would greatly reduce the amount of time your property is under contract. If you decide to accept an all-cash offer, you will likely close in a short amount of time.Before you list in a hot market means more often than not you need to move quickly. Be prepared for this possibility prior to placing your property on the market. You should be searching yourself for a rental or for the replacement home before you list. It may even be wise to have a rental lined up if you do not find another property to buy right away.Be Committed to Selling – It’s Not the Time to Test the Market

Work Closely With Your Agent to be Committed to Selling

Just because the market is hot does not guarantee multiple offers for over asking price. Set reasonable expectations about selling your home.

Every property for sale is different. This is where your agent can really help you understand the market. Sure, you’ve heard about the house down the street that sold in two days for $50,000 over asking. But you do not know all the circumstances surrounding that sale. Perhaps it was just a fluke with the perfect buyers coming in for that house. Perhaps there was something highly unique to that property that made it sell so fast and for so much money.

House prices can differ drastically within neighborhoods. Many criteria that aren’t readily apparent from researching the MLS or past sales might make a property sell for more: a great layout, lots of light, decorator colors, or mature fruit trees are all examples of things that might tip buyers into a frenzy that creates high prices and multiple offers.

Your home might not offer these. Take solace in the fact that you are selling in an up market and are more likely to sell for closer to your asking price than you would in a down market. And, if you happen to be one of the lucky ones who garners more from the sale than you ever imagined, feel free to pop the champagne at closing!

There is no “perfect” offer you should be hoping for to make you sell the home. Price and terms often have dependencies on them which ultimately impact the price. Make sure to have a frank discussion about your motivation and committed to sell with your agent. Buyers are often under the gun for time and that is driving the offer price. Telling the buyer, you need a 3-month rent back for free might help to NOT sell your home. Understand in a hot market time is of the essence. Be sure that you will be present or able to review all offers within a short amount of time after the property is listed.

Pro Tip: Plan on responding to the offers within 24 hours. If you plan to counteroffer, do so in a timely manner. It is not uncommon for the negotiation process to take 24 to 48 hours. I’ve seen where offers are not reviewed until a later date where the seller and agent are hoping for offers and the seller receives no offers. Buyers are well informed in today’s market, the best buyers are on the home search 24/7, if your home is priced right, it will get an offer quickly in a hot market. If you go a week without an offer and your market is hot, you’ve missed the best buyers for your home.

Hot Market Appraisal Issues 

Hot markets often arise quickly and the nature off a hot market causes issues for the appraiser. Home Appraisers may be comparing your property to properties that sold for significantly less a month ago. The appraised value of your home is supposed to be based upon a balanced market where the sale isn’t with few sellers or few buyers. Hot markets cause the value to be higher than it would be in a normal market.

What Happens If My Home Doesn’t Appraise?

If a property doesn’t appraise for the offer price and the home was to be purchased with a loan: The buyer will have a lot of difficulty getting the loan amount they needed for the current offer price. As a seller you may be forced to lower your sales price or seek out buyers who are paying cash and do not need the approval of an appraiser to complete the deal. Most of the time, if a property doesn’t appraise and the seller won’t lower the price, the deal is dead, as the buyer has no other options besides a traditional lender to cover the purchase price.

Pro-tip: Buyers in a hot market, buyers often have no extra available cash other than down payment and closing costs. It’s important that your agent qualify the buyer who makes an offer and verify if they can or have cash available should the home not appraise in a hot market. Think twice about accepting an offer where the lender pre-approval of the buyer is not higher than the purchase price. Make sure the agent calls the lender to discuss the qualifications of the buyer before accepting or countering any offer.

Final Thoughts – Don’t Second Guess Selling in a Hot Market

My advice is be committed to selling and realistic about pricing your home selling quickly, Hot markets are about commitment. Buyers are committed to buying and you should be as well. Here is a helpful checklist if you want to sell in a hot market.

  • Do your research before you sell and explore homes for sale 
    • Look at the market as a buyer – tour open houses and talk to real estate agents to assess the hot market.
    • Contact a real estate agent(s) and get a real price for you home to sell in less than 30 days.
    • Make plans to rent or to buy quickly so you can sell quickly.
    • Commit to making your home ready for sale.
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  • Commit to selling
    • Enter into a listing agreement to sell your home with a price to sell quickly.
    • Get pre-sale inspections, reports, and disclosures.
    • Adjust the price based upon your homes condition to sell quickly
  • Sell the home
    • Respond to offers as they come and quickly
    • Make sure you pick the best buyer who can and will complete the purchase
Sell with confidence with pre-sale inspections

Why Pre-Sale Inspections Help Sell Your Home

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Performing pre-sale inspections on your home before you list it for sale can streamline the sales process and help you avoid any unexpected surprises. What most sellers don’t realize is the inspections of the home is the place where more sales fall apart than any other. The pre-sale or pre-listing home inspections will allow you to get a clear picture about the state of your house – including any problems that may derail a sale. You will have a chance to address major issues, and the information you gain from the inspection will be useful in pricing your home. Getting pre-sale inspections can be an important part of negotiating any offers and address any concerns a buyer may have after you are in contract to sell. for. By understanding the condition of your home, discovering any potential issues to sell, and getting most or all of the problems taken care of you increase the chances of having a smooth transaction from contract to close..

Why You Should Get Pre-Listing Home Inspections

Home inspections are generally performed on behalf of a buyer so that the party purchasing the home knows the true condition of the house. There are typically for a home; a wood pest inspection, a roof inspection, and a home inspection. As a seller, you are not required or provide these inspections. But there are several reasons why you should consider performing these pre-listing inspections;

1. Reduce the stress of selling your home.

By getting these home inspections before listing, you can make informed decisions and responses about any buyer concerns that arise during the sale of the home. Performing these inspections gives you essentially a condition report for your home. This is truly helpful in my opinion for selling your home. You now know if there are any issues and you are basically providing the potential buyer that “here is my home, there shouldn’t be any surprises after you make an offer.” This helps eliminate a lot of stress for both seller and buyer surrounding the sale and is especially helpful in any market to help sell the home. It is normal to worry that your home may have some hidden problems that you are not aware of. With these inspections, you will know if any such problems exist and have the opportunity to address them. More importantly you will be able to obtains the costs to address any issues for selling your home and not be held to a contract timeline to address if its something the Buyer wants addressed while in contract. With buyer inspections after you are in contract for sale, you will have to meet the requirements of the sales agreement for close of escrow which is usually based upon no repairs being factored in. Should any buyer requests for repairs arise from their inspections during the contract you will be rushed to respond to. As a Seller you will have to quickly determine the cost to repair, if the repair can be done in a timely matter, then respond to the buyers request, which might mean clearing the issue during escrow or provide a credit at the close of escrow. This for the agents involved is when the contract is most likely to fall out. You can avoid surprises and uncertainty for buyers who are in contract if you have pre sale home inspections available.

2. Help with pricing your home correctly.

The price you set for your home going on market is one of the most critical pieces of the sales process. Priced too high, you will keep buyers away. Priced too low and you will make less money than you could have. But how do you price something when you do not know what it consists of, or what state it is in? With these home inspections, you will have a much better understanding of any negative aspects of the house, and can price accordingly. You may also be able to price the home slightly higher if you discover that there really is nothing wrong or the sell the house is in excellent condition with no major issues since you addressed them prior to being on market.

3. Pre-Listing Home Inspections Can Speed Up The Sales Process

A buyer that knows you have already had the home inspected is going to feel a lot more comfortable making an offer. No one wants to buy a house that has a bunch of hidden issues. With the inspections in hand, you can demonstrate that the home is in great shape and worth the price you have set. And if there are issues, you can be upfront about them and make it clear that the reasonable price of the home reflects the knowledge of those issues. Furthermore, you can negotiate the issues before accepting an offer which can mitigate any buyer requests for repairs and costs for you to address.

4. Allow you to Make Repairs to Help Sell Your Home Faster.

One of the top home selling tips that I recommend to Sellers is to make sure repairs are made to major items in the home. It makes perfect sense because what buyer wants to deal with the problems of someone else when they don’t have to? Buyers complete the purchase more often based upon the condition and care the Seller’s have invested during ownership. Nice well maintained homes sell quickly, ask any agent.

5. Avoid or Minimize the Requests For Repairs.

With a pre-listing inspection, you can avoid such a situation where the carefully considered offer from the buyer may be thrown out the window if the buyer’s inspection discovers any serious issues with your home. Because you have a comprehensive knowledge of the condition of your home you can negotiate the home sold “as-is” in its present condition because the Buyer knows what he is buying before he made the offer. Nothing can be more upsetting than to see the deal you were relying on begin to crumble, and salvaging such a deal can lead to renegotiation that ultimately leave you on the losing end with costs you didn’t plan on to sell you home.

6. Sell Your Home With Confidence.

Buyers are in a difficult position, so it is normal for them to retain a healthy amount of suspicion when considering a home purchase. For most people buying a home is the most money they will ever spend on a single item. A buyer will need to calculate what he or she can afford for the purchase price, as well as how much money will be required to live in the home and keep it in good repair in the future. If the buyer has any thoughts that the home might have hidden problems, the offer he or she makes will reflect that. A pre-listing home inspection can help eliminate much of the doubt about the home. Knowing that the home has already been examined and that there are no problems allows the buyer to make a confident offer.

7. It makes the Sale of Your Home Easier and Less Stressful for Everyone.

When you agree to pre-sale/pre-listing inspections, it allows the sale of your house to be focused on the quality and condition and you have reports and inspections which justify the sales price of your home. Much like a CarFAx for a car, When the agents knows the exact state of the house, it is easier to compare it to other homes that have sold in the area, which leads to a price not subject to things found after. The inspection also makes it easier for the agent to find buyers, because buyers are attracted to homes that have already been inspected and have very little problems. And when it comes to negotiations, there are no unknowns. The price doesn’t need to be lowered very much, if at all, when it reflects that true state of the house.

Keep in mind that even though you have done a pre-sale inspection, the buyer will more than likely want to have their own inspection as well. You should insist on your listing agent attending the home inspection to not only understand what the buyers home inspector says but to make sure the buyer does not exaggerate any of the issues. Buyers are notorious for using a home inspection as a point of renegotiation. Oftentimes buyers will try to negotiate for things that are non issues. The example I always use is the home inspector saying there is 3-5 years left of the roof and the buyer saying a new roof is needed. Having your agent there to hear exactly what is said is important. You are paying your agent a lot of money – make sure they earn it!

Are There Any Disadvantages to a Pre-sale Home Inspection?

In my opinion there are really none. California real estate home sales require sellers to disclose all known problems with their homes. Home inspections removes that concern and liability as a seller. If you are short on money to make major repairs to your home, doing a pre-sale home inspections can allow you to sell the [rop[erty as is with np financial contribution by the Seller for any requested repairs from the buyer. If your thinking of selling your home to one of the iBuyers (Opendoor, Zillow Offers, OfferPad, etc) knowing the condition of your home could help significantly to determine if you should seriously consider the offer or go on market as an “as-is” sale for more money.

Why Not Make Your Sale Easier With Pre-Listing Home Inspections?

There is no requirement that you get a pre-listing home inspections, but there are certainly a lot of advantages to doing so. Every home sale involves working through home issues, costs, and repairs, but you can limit the negative aspects of the process by gathering all the accurate information you can about your home before you list it. With seller’s inspections, you avoid surprises, control the negotiations and make your sale of your home meet your financial needs.