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Why Sell My Pensacola Home Now???

Many homeowners look at the Real Estate market today and wonder if they should just sit tight and wait until the market gets better or if they should sell their homes now. Here are some things you will want to consider when making this decision:

-Do I have Equity in my home? Chances are, if you have owned your home at least 5 years (depending on your market area- I refer mostly to my local NW Florida/Pensacola area), you either have equity or at least will not be upside-down on your mortgage if you need or want to sell now. Here locally in NW Florida, our home prices were inflated after Hurrican Ivan due to a shortage of available homes. So if you bought your home shortly Post-Ivan, chances are it is worth less today than when you purchased it (unless you have upgraded or remodeled, or live in a desirable neighborhood).

-Have you refinanced in the last five years to use your equity? If the answer is “Yes”, then you may end up bringing money to the closing table. For some Sellers, that may be an option. You have to consider that your home is probably still worth more than you paid. According to the National Association of Realtors, “Over the past 30 years, the median price of existing homes has increased an average of more than 6 percent every year, and home values nearly double every 10 years…”. You may have pulled the equity from your home to do a remodeling project- in that case, the value of your home may have increased enough for you to obtain a higher sales price and either gain a profit or at least break even at closing.

-Why do you want to sell? For most people, it’s a change of job or a change of lifestyle. In our area, we have many military who move every 3 years or so, and the choice is either to sell or to rent. Luckily, our area has a good residential housing rental market due to the relatively low number of apartment rentals, so hiring a good Property Manager and renting for a few years to make the mortgage payments makes it easier for those who just “can’t” sell right now. If you “have” to sell, due to a job change, divorce, needing more space, or whatever the reason, just be sure to listen to the advice of a Real Estate professional who is knowledgeable of your area’s home sales. If you price your home too high, your home may sit on the market during the peak times and not garner any Buyer attention. By the time you lower your price, you will have spent more money maintaining the home (utilities, taxes, insurance, lawn care, etc.) then you would have by just taking the price reduction up front. Not to mention the fact that if you are carrying two mortgages it can prove to be a great financial burden. If you believe your home is worth more then your Realtor tells you, either get a second opinion by purchasing an appraisal (can cost around $400 - I only recommend this for hard to comp homes that are unusual, such as custom homes or homes with acreage) or at least build-in an automatic price reducation into your listing contract. One option would be to start at the list price you think is fair, and then if you have no or few showing in the first 3 weeks of the listing, allow your agent to automatically lower the price in preset increments every few weeks to a month. Eventually, you will find the “Sweet-Spot”, or the price that starts bringing potential Buyers to your doorstep. If lowering the price doesn’t bring the Buyers, consider offering alternative financing options, such as Lease w/Option, Lease to Own or Owner Financing. If you are worried about needing to foreclose on an Owner Financed home down the road, check into doing a “Contract for Deed”. This works more like a Lease to Own where you still hold the Deed in your name until such time as the Buyer refinances or completes the terms of the contract. Before you do this type of contract, talk to a lawyer in your area and have them draft the contract for you. There are “Contract for Deed” forms available on the internet if you trust them, but it won’t cost much to have a lawyer draft the contract for you, and it will better protect your interests.

-If I sell my current home, is it a good time to buy a new home? YES! It is absolutely the best time to buy due to the great inventory of homes on the market (more to choose from and more house for the money), the low interest rates, and the deals to be had on foreclosure and pre-foreclosure/short-sale properties. If you have credit issues, there are even many lease w/option or owner-finance homes available. In a Seller’s market, you won’t see many of those options available. Best of all, if you are a First Time Homebuyer, there are plentiful bond money and down-payment assistance programs available (in our area, up to $35,000 down-payment assistance) and lenders are desperate to find qualified Buyers. Not everyone can get a loan right now (that’s part of the current foreclosure problem- loans were given willy-nilly to people who couldn’t afford them), but if you have reasonable credit and a job that you’ve been in for at least a couple of years, you may qualify for a mortgage. Right now, with the low interest rates and low housing prices, your loan payment will probably be less than rent. And, as long as you have a fixed-rate mortage, your mortgage payment will remain fairly steady, unlike rising rent prices.

In the end, it’s all about your motivation. Either you want or need to sell your home now, or you can wait until there are fewer homes on the market and prices start to increase again. The choice is yours, but if you’d like an opinion on your home’s current value, just give me a call or email and I’ll be happy to provide you with a free neighborhood home value report.

If you want to learn more on a certain subject, please email me at BrokerTrish@gmail.com or call 850-449-0908 and I’ll be happy to include it in a future blog, or talk to you one-on-one. Happy Blogging!

Published Tuesday, June 10, 2008 10:36 AM by Trish Sarfert