Study Reveals Best Real Estate Pricing Strategy

Set the asking price just below a round number – that’s the best technique for pricing a home for sale, according to new research published in the Journal of Housing Research.

“Our study suggests that by using the just below pricing strategy sellers can price their home slightly higher without driving away potential buyers,” says Eli Beracha, one of the study’s author. “As a result, they end up selling their house for more.”

“We tested the age-old debate concerning the best technique to price a home when listing it for sale,” Seiler says. “We find that using a price just below a round number works best, particularly in connection to the left-most digit in the price. So, $199,000 works better than $200,000.”

Source: “Left Digit in Sales Price Affects Home Buyers Most,” BUILDER (Aug. 11, 2016)

How’s Your City’s Well-Being?

Good news if you live in Florida, California, Colorado, or Texas – your residents display a high sense of well-being, according to the Gallup-Healthways Well-Being Index. These four states alone account for 14 of the top 20 well-being communities in the latest report.

To measure well-being, researchers weighed purpose, social, financial, community, and physical data-points of 190 communities across the country.

Download a copy of the full report to see where your city ranks.

Source: Gallup-Healthways Well-Being Index

Groundhogs Know Best: Spring Buying Is On Now!

The infamous groundhog – Pennsylvania’s Punxsutawney Phil – may not only have the power to predict how many more weeks are left to winter but also the ability to predict the start to housing’s busiest time of year.

Phil didn’t see his shadow on Tuesday’s Groundhog Day, which, if superstition holds true, means that winter will be shorter this year, with a warmer February across the country.

If the groundhog is correct, Jonathan Smoke, realtor.com®’s chief economist, says, that could spark an early start to the spring homebuying season.

“When the housing market is strong like it is now, and Phil doesn’t see his shadow, February sees an average 11 percent year-over-year increase in existing-home sales,” Smoke continues. “Thanks to Punxsutawney Phil, we know that the spring housing market starts early this year — and buyers and sellers had better be ready.”

Source: “Guess What? Spring Home Buying Starts Now (Thanks, Punxsutawney Phil!)” realtor.com® (Feb. 2, 2016)

The Hottest Home Dream Features Most Often Touted

Must-have home features are constantly evolving. After all, just a half century ago, shag carpeting in all hues – gold, orange, and purple – were all “in.” But what’s hot with home owners and buyers now?

Realtor.com® set out to find out, evaluating what must-have home features are hot right now by analyzing millions of listings for the most commonly used phrases of home features. Now, home dreams are made of—a mixture of classic favorites and rising stars.

View more information about the 20 “hottest” home features at realtor.com®.

Source: “Garden Tubs Are In, Spa Tubs Are Out: The Hot List of Home Features,” realtor.com® (Dec. 21, 2015)

5 Paint Mistakes Home Sellers Should Avoid

The wrong paint color can be a big turn-off to potential home buyers. House Beautiful recently highlighted some of the worst mistakes home owners can make when it comes to painting their house, including:

1. Painting a ceiling a flat white color. “I never paint a ceiling dead white because all white paint has a bit of gray in it, and it takes the room down,” designer Athalie Derse told House Beautiful. Instead, she suggests choosing a cream shade.

2. Too many colors from room to room. “Even when I don’t use the same colors everywhere, I still like the rooms to feel connected,” designer Mona Ross Berman says. “The bedroom should never feel like it’s in a completely different house than the living room. The whole house has to make sense as one.”

3. Using the same color palette for the entire house. On the flip side, home owners who only stick to one color palette may be making the home too bland. “A two-color scheme can be great, but there has to be some relief, or it comes across as too pat and makes everything seem stiff,” says designer Tom Scheerer.

4. Matching. “You never want to match your walls to a color in one of your fabrics,” Sallie Giordano says. “It will be too strong. Find a grayed-out version of the color.”

5. Use neutrals to balance out color. Some home owners may be tempted to go overboard with one color. “The biggest mistake people make when they’re trying to be colorful and exciting is to forget that you need to balance it with neutrals,” says designer Todd Klein. He adds that architectural elements in white or even a few gray throws can give visitors’ eyes a place to rest.

Source: “The 9 Paint Color Mistakes You Should Never Make,” House Beautiful (August 2015)

More Home Owners Getting Bit by Selling Bug?

Reports of rising home prices are making selling more attractive to the largest share of home owners in eight years, according to a gauge from the University of Michigan and Thomson Reuters. Few of the home owners surveyed said they expected to lose money if they decided to sell their home now.

The findings could signal the beginnings of a major shift for the housing market, which has been haunted by the low number of homes for sale across the country.

Home price increases over the past two years may give more families confidence to sell their homes, alleviating low inventories and giving home buyers who were sitting on the sidelines because of fewer housing choice more incentive to make a move too, The Wall Street Journal reports.

Rising confidence among consumers could also translate into more sales in new homes. Last week, a report by the U.S. Census Bureau showed that new-home sales surged nearly 19 percent last month, reaching the highest rate since May 2008.

Two home-building giants reported a steady turnaround in new orders and price rises too in the second quarter. Lennar reported that new orders were up 8 percent, with average sales prices of its homes blooming 14 percent year over year. KB Homes, meanwhile, reported that orders increased 5 percent and its average selling price increased 10 percent in the past year.

Source: “More Would-be Home Sellers Say Prices Are Attractive,” The Wall Street Journal (June 27, 2014)

New Way to Sell a Home: Arrange a Sleepover

One of the fun parts of searching for a home to buy is visualizing living in it. Will your furniture fit? Is the kitchen big enough for all of your kids? Imagining your belongings and your family living in the home can make the buying decision easier.

When checking out a house, some buyers take the extra step of spending the night. It’s a simple yet effective way to kick the tires and test-drive a prospective home. Along the way you’ll have an opportunity to check for noisy neighbors, test the water pressure, and inadvertently, for one couple — learn how concerned the neighbors are and even how quickly the police respond.

HGTV’s “Sleep On It,” which follows potential buyers as they stay overnight in two homes with the sellers’ approval before deciding which one to buy, hasn’t seemed to spark a national trend. But it has prompted such proposals to surface more often.

Source: “When Homebuyers Insist on Staying the Night,” U.S. News (2/3/14)

 

 

More Homebuyers Willing to Compromise?

Faced with tight inventories of homes for sale, more buyers are realizing they may have to bend a little in order to get the home they want.

According to a new survey by the real estate brokerage Redfin, 35 percent of real estate agents said that buyers are now “willing to pay more” to find a home compared to this summer. About 30 percent of agents also reported that buyers are more “flexible on features,” held “lower expectations” for how far their money would stretch, and were “looking to new construction” due to inventory constraints. Real estate agents also reported that homebuyers were more “prepared to waive contingencies” to win a bid.

Eighty-seven percent of the Redfin real estate agents surveyed cited “limited inventory” as the biggest challenge that homebuyers face nationwide.

While homebuyers may be getting more realistic about market conditions, the survey found that sellers are not. Sixty-three percent of agents said that sellers have “unrealistic expectations” about the value of their home. 31 percent of agents say that sellers also are frustrated with the number of homes available that they would be interested in buying.

Source: Redfin

More Sellers Having to Reduce List Prices

One in four home sellers are reporting they’ve had to lower their list price, according to a new report released by the real estate brokerage Redfin. That represents the highest level since 2011, according to the Redfin survey. It also represents a far greater number than in February, when just one in seven sellers reduced list prices.

More home buyers are showing a willingness to wait until the price is right, according to Redfin.

Price drops for homes were most prevalent in Atlanta, in which 42 percent of home sellers reported lowering their prices in September. Sacramento, Phoenix, San Diego, and Seattle also saw price reductions of more than 30 percent on homes for sale, according to Redfin.

Source: Redfin

Home Buyers Face “Higher Closing Costs”

Rising mortgage rates aren’t the only problem house hunters are facing. Closing costs for loan origination and other fees have increased 6 percent in the past year, according to a survey by Bankrate.com.

Borrowers with stellar credit who are making a 20 percent down payment are still forking over an average of $2,402 in closing costs on a $200,000 loan.

The main catalyst for the increase in closing costs is origination fees, have jumped 8 % in the past year. Rising interest rates often cause origination fees to go up, too. Lenders are also having to do more work underwriting loans. Rising mortgage rates often mean lenders make less profit on their loans, so they try to make up for the loss with higher closing fees, Guy Cecala, publisher of Inside Mortgage Finance, told USA Today.

Borrowers should shop around for mortgages because some lenders may offer loans with variable fees. We recommend contacting two local, experienced lenders for advise.

Source: “Mortgage closing costs are on the way up,” USA Today (Aug. 5, 2013)