How to buy and sell houses in a slow economy

By Raymond James

For many homeowners, selling a house in a normal economy can be a somewhat tense and stressful endeavor. However, if you are attempting to sell yours in a slow economy when few people are buying, it can be a process of near misses and tested hope. A slow economy contributes to what is known as a buyer’s market in that there are more houses for sale than there are buyers. That said, for the diligent homeowner, selling your home in a slow economy is not really more difficult than doing so in a bustling economy because all that is required is that you pay very close attention to the basics of preparation and marketing, which include paying attention to your home’s appearance, your marketing, and the house’s price.

In terms of buying a house, you have a much easier task ahead of you. The most important things you want to do include being ready to negotiate and being willing to ask for concessions. After all, in a buyer’s market you are calling the shots because there are often many other equally nice homes for sale right down the road.

Selling

1. Update

As any broker at Rowling & Co Real Estate Agents will tell you, a home that has been updated will attract more potential buyers than a house that is marketed with its day-to-day appearance. For maximum appeal, you should update the refrigerator and stove, ensuring they match. When it comes to window treatments, blinds are warm and professional.

Painting the walls is an absolute must. Although it is an unwelcome task for the seller, buyers will look at any house painted in colors they do not like and see an unwanted chore. As, such, they will then continue shopping for an easier house.

2. Curb appeal

Curb appeal usually offers no real return on investment other than the fact it helps get potential buyers in the door. In a slow market, this is your primary task. The yard should be manicured, and the exterior bushes should be neat and trim. If possible, you should paint the house and ensure the overall façade is warm and inviting.

3. Neutral

As a seller, you should make the job of buying and moving into a home as easy as possible. As such, walls painted to suit the personal tastes of the owner need to be re-painted to neutral grays or tans. Doing so will allow potential buyers to better imagine what the house might look like once they move in.

4. Online listing

The modern home buyer shops online. As such, you should have a minimum of 10 photos. Ideally, you should have 20 to 24. Too many photos, however, can make shopping for a house a tedious process. Additionally, you should have two photos of every room. This is something that sellers often do not do, thinking one photo is enough. However, you should have a second photo of a room taken from a different angle. All photos should be wide shots that capture the room’s total area. Finally, you should avoid closeups of oddball objects.

In terms of information on the house, you should list the house details as objectively as possible. Modern buyers are sophisticated. Such marketing terms as cozy, for instance, are interpreted as cramped.

5. Tax assessment

You should ensure you have the latest tax assessment listed in the online listing. Doing so will allow you to show that the pricing is fair or even inexpensive.

6. Online estimate

Many sites offer a free online estimate of a home’s worth. If your price deviates from this estimate, the reason better be obvious. A price that is set slightly too high invites negotiation. A price set dramatically high invites a potential buyer to shop elsewhere.

Buying

1. Negotiate

In a fast economy, it might be prudent to offer full price for a house in order to actually get it. However, buying a home in a slow economy affords you two important options.

First, you should ensure the price is equal, more or less, to the average estimated value of the home as indicated by your favorite house-listing website.

Second, you should compare the price to other homes in the area, understanding that updated homes reflect a higher price. Once you have found a house priced appropriately, you should make an offer of at least 10 to 15 percent lower than the asking price. Sometimes, in a buyer’s market, sellers become very motivated and will often accept an offer that is 25 percent lower than asking price.

2. Repairs

Before the house passes inspection, major items will need to be repaired, but you should also ask that minor items also be repaired. After all, in a slow market a seller cannot simply wait for the next buyer as there might not be one. Knowing this, you should require the seller to take care of the chores you would otherwise have to do.

About the Author

Ray is a sought after thought leader and an expert in financial and money management. He has been published and featured in over 50 leading sites and aims to contribute articles to help novice financial planners. One of his goals is to impart his knowledge in finance to educate and help ordinary people create and achieve their financial goals.

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