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Advice for First Time Home Sellers

Advice for First Time Home Sellers

Selling your home can be an emotional and stressful process. You love your home and it is likely the biggest investment you have ever made. You want prospective buyers to fall in love with it as well – whether through photos, descriptions or in person. Being a first-time home seller, you have the distinct advantage of having gone through a purchase and sale transaction before, when you bought your first home. So, you know the large amount of prep work that goes into a real estate transaction, and you know how important it is to be prepared.

Identifying your motivation for selling is a crucial first step for any home seller, whether it’s needing more space, downsizing, relocating for school or employment reasons, whatever the reason, it will be an important factor in how you going to price and market your home. It’s also important to address your finances, contacting your current loan servicer to discuss your remaining mortgage balance can help you begin to understand how much equity you will have when you sell. Being informed of your current equity can help you budget for improvements you may need to make before listing your home for sale.

Advice for First Time Home Sellers

After figuring out your motivation for selling your home, and determining the equity you will be working with, sellers are often advised to begin researching the best time to sell in their area. Establishing if you are in a buyers or sellers’ market is necessary when establishing the best time to list your house on the market. Typically, the first half of May is commonly known as the best time to list a house for sale, however, COVID-19 has altered markets all over the country, particularly throughout Vermont. You will want to get the price you want, and the best first step is to be properly informed on what houses in your area have recently sold for, and educate yourself on what you can expect from the current market.

Deciding your representation strategy is a vital step when deciding how you plan on listing your house for sale. This mainly comes down to interviewing and selecting an agent to represent you. This is the most important relationship you will form while selling your house. Picking the right agent can help recognize what improvements would be best to make before listing, determining the most competitive price to list your house at, and the most effective way to market and promote your home to motivated buyers. An agent will also be instrumental in helping you navigate the closing of the sale and any last-minute surprises that come with it.

Advice for First Time Home Sellers

There are countless listings online, even right in your neighborhood. The most successfully promoted homes are ones that have been professionally photographed, contain a compelling property description and are advertised across a broad range of channels and platforms. The goal is to create as much interest from potential buyers as possible, and present your home in the best possible light. Home buyers have access to a multitude of online listings so it is important to find a way to make a great first impression, both online and in person showings. A trusted agent will explore a variety of approaches to expose buyers to your home, and ensure that you get the best possible price from interested buyers.

When negotiating an offer with a buyer, it is important to remain flexible and open, as well as maintain realistic expectations. Getting a great offer is one of the biggest hurdles in the home-selling process, and negotiating is of the upmost importance to guarantee you fulfill your initial goals. A dependable and experienced agent can be your greatest asset to make sure your best interests are represented. When you receive an offer you have a few options, accept the offer as is, make a counteroffer or reject the offer. If you receive multiple offers you may be tempted to take the highest one, however, if the buyer is relying on financing from a lender, the property has to be appraised. If the appraisal comes back lower than the offer, the buyer could pay the difference in cash, the sale price could be renegotiated or both parties could walk away from the deal.

Advice for First Time Home Sellers

Closing is the last step in the home selling process. This is when the final paperwork is signed, prepare your home for the buyer’s final walkthrough and troubleshoot any last-minute issues that might present themselves. A buyer’s home inspection can uncover all kinds of obstacles that the buyer may find too costly and chose to walk away from the deal. It is imperative to be prepared to negotiate after the inspection report is complete. Review your estimated closing costs ahead of the closing day in order to be prepared for the charges you are likely to see. If you are able to work through the inspection and the repairs, the only steps are signing the documents, handing over the keys, and celebrating successfully selling your first home!

Please feel free to call us at Geri Reilly Real Estate for a Free Consultation.

Buying a Rental Property

 Buying an Investment Property

                Investment property is real estate purchased for the purpose of generating income. The intention is for the property to be rented out or used as a seasonal vacation home for other travelers, and in turn, create a reliable source of income. Buying your first rental property is an exciting prospect, however, it can also be immensely confusing and intimidating. Maintenance costs and stringent financing requirements are just a few of the challenges you might encounter while pursuing your first investment property.

Buying an Investment Property

                When first starting out, it is advised to work with a real estate agent, particularly an agent who understands the investment side of real estate. The first step will be to begin analyzing potential properties; It’s often advised to find your first deal locally, or between an hour and two hours away from your current area. Work to find an area with a steady stream of renters, and figure out where people want to live. Where are property prices higher or lower? What are units typically rented out for? Is crime a consistent issue in the area? These are all vital questions that you will need to ask yourself before deciding on an area to invest in. Consulting with local real estate agents, property managers, and other local investors can be incredibly valuable when considering these propositions.

                Begin to analyze potential properties, as many as you possibly can, in order to familiarize yourself and get comfortable with deal analysis. Try to research a few properties everyday until you find something you think is right for you. In a competitive market you will need to be fast and smart in the offers you propose. You will get offers rejected, consistently, investing in real estate is a numbers game, and you can expect to get 1 out of every 10 or even every 20 offers accepted. The goal is to make sure you’re always making offers on enough properties. It is recommended to aim to buy an investment property for 10% to 20% below the market. This will allow you to increase your net worth and financial security if you ever need to sell the property in a pinch.

Buying an Investment Property

                Investment properties require a much higher level of financial stability than a typical family home would, especially if you plan to rent out to prospective tenants. You will need to be prepared to cover the initial home purchase costs like the down payment, inspection and closing costs as well as the ongoing maintenance and repairs that frequently accompany investment properties. When you do finally get a property under contract, you’ll be expected to pay earnest money, which is typically 1% of the purchase price. Earnest money essentially serves to ensure that you will not walk away and waste everyone else’s time and effort. This fee is refundable only if you buy the property as promised or back out due to a legitimist reason, like a disastrous inspection, uncovering unforeseen detriments.

                Once you do close on a property, and have effectively budgeted more than you think you need for regular and emergency home repairs, it’s essential to estimate your annual rental income. Research similar units to find an average monthly rent. Commonly, what your charging for rent should amount to at least 1% of the total purchase price. You also need to calculate your net operating income – This equates to your annual rental estimate minus your annual operating expenses. Combine the cost of the everything you will pay while maintaining your property every year; like insurance, property taxes, maintenance and homeowner association fees. Do not include your mortgage or interest in your net operating income. Divide the net operating income by the total value of your mortgage to find your total return on investment (ROI).

Buying a Investment Property

                When it comes to owning an investment property your budget involves more than how large of a mortgage you can afford. In addition to monthly mortgage payments, you will also have to budget for the ongoing costs of owning and renting out the property – utilities, maintenance, upkeep, and taxes will all weight against how much you realistically expect to collect in rent. Maintenance will likely be one of the most significant costs to consider when purchasing an investment property. You can choose to hire a property management company or handle things rent collection, repairs, and snow removal on your own. New investment property owners can expect to spend 1% of their property’s value each year on maintenance, but it varies depending on factors like the number of units, when the property was built and the conditions of major systems like plumbing and electric.

                In addition to expenditures like taxes and homeowner insurance, you will also have to budget for marketing your property, background checks on prospective tenants, and utilities. You want to make sure that your property is adequately marketed to the right audience of renters, and be prepared to perform background checks to ensure that you are getting the highest quality of candidates. As far as utilities go, you will have a few options; you can either include them as part of the monthly rent, charge your tenant each month, or ask the tenant to sign up in their name and pay the utility companies themselves. It is also important for investment property owners to be familiar with rental laws that vary state-to-state, as well as be prepared for having to deal with delinquent tenants.

Buying an Investment Property

                Purchasing an investment property is a big step for any investor, and more than likely will be one of the largest assets you can buy. With a little bit of time and effort, and a lot of research and due diligence, it can be a great way to generate passive income. The cornerstone of successfully buying and owning an investment property is to be prepared and knowledgeable of all the challenges and obstacles you may encounter along the way. Investing in real estate is certainly not for the faint of heart, however when done right it can be one of the most fruitful and rewarding financial decisions you ever made.