New Year resolutions for home sellers
A sale pending sign hangs in front of a single-family home in Brookline, Mass. The number of Americans who signed contracts to buy homes in November rose to the highest level in a year and a half. (Dec. 27, 2011) Credit: AP
Each year we post our financial resolutions for home sellers for the new year. With the current state of our financial system, you need to keep your financial house and home in good shape.
I know someone who sold a house this year. It took them seven months, and they had to cut their price a lot lower than they wanted, but they finally got a good offer and the property is scheduled to close by the end of the year.
It isn’t easy being a home seller these days. Home values are off 33 to 60 percent from their high in 2006. Roughly 25 percent of homeowners are underwater with their mortgage (meaning that their home is worth less than the mortgage amount) according to third quarter 2011 data from CoreLogic, which aggregates data. And, another million homeowners lost their homes to foreclosure, putting downward price pressure on neighborhoods across America.
Despite record-low interest rates, which touched 3.7 percent for a 30-year fixed rate mortgage and the even lower 3.25 percent for a 15-year loan, buyers have been reluctant to jump into a market where it’s uncertain whether home prices are appreciating, holding steady or declining further.
If you’re hoping to sell in 2012, you’ll be facing all these challenges, and more -- the real estate industry isn’t expected to improve much over the next couple of years, although some markets seem to be stronger than others, including Washington, D.C., New York, San Francisco, and several cities in Texas.
Certainly, until the unemployment picture improves substantially, it will be difficult for the real estate industry to gain any positive momentum. That’s why North Dakota (with a 3 percent unemployment rate) also ranks as one of the stronger housing markets.
So what can you do if you want or need to sell in 2012? Consider my classic New Year’s Resolutions for home sellers:
Remember, a successful sale means everyone walks away feeling happy. If you get so greedy that the buyer walks away, you’ve let the deal get the best of you. Resolve to be reasonable and you’ll end up shaking hands with the buyer at the closing. You should also know that there are fewer buyers out there and if you lose a buyer it might take you quite some time to find another one.
