The 10-Year Rule For Real Estate

It may not be the best time to sell, but it might not be the worst
either. Recent economic forecasts suggest that the housing recovery
could take years. As a seller who has a strong motivation to sell,
do you try to sell now or hold on for a better market?

First consider where you want to be in 10 years. How do you
envision your lifestyle? Is your current home too big, too small,
or in the wrong location?

Homeowners intent on moving from one house to another can take
advantage of low interest rates, if they are able to sell their
current home. You'll probably sell for less than you would have
several years ago, but you may get a deal on the home you buy.

However, if you don't plan on living in your next home for the
next eight to 10 years, this might not be a good time to make a
move.

For sellers who purchased in recent years, selling requires a huge
readjustment in their expectations. Many will probably sell for
less than they paid; in some cases, a lot less. If they highly
leveraged the purchase, or refinanced and pulled out equity, they
may need to contribute cash to close the deal.

Sellers who have no cash reserves and need to sell for less than
the amount of the loans secured against the property will need
lender approval to complete a sale. This is called a short sale.
In this case, or with a foreclosure, sellers don't have the option
of buying another home until their credit is restored, which takes
about two to three years for a short sale and five years for a
foreclosure.

Some listings in prime, high-demand markets come on the market and
sell quickly, leaving other sellers in the area perplexed. Why
isn't their home selling? Why aren't they receiving bids from
multiple buyers?

Listings that sell quickly are priced right for the market. They
are homes that will work long term for the buyers, which means 10
or more years. They don't need updating; they're in move-in
condition. And, they are usually located in high-demand,
low-inventory neighborhoods. Buyers are waiting for these prime
listings and will move quickly when they come along.

HOUSE HUNTING TIP: It's frustrating for sellers whose listings
don't receive an overwhelmingly positive response, especially if
they put time and money into fixing them up for sale, and they
thought they priced right for the market. Motivated sellers will
need to accept the probability of a longer marketing period and a
lower price.

Expect low offers if your home has been on the market awhile. It's
natural for buyers to try to buy a home as inexpensively as
possible to cover for the possibility of a further downturn in the
market. Don't take it personally; counter any offer from
financially qualified buyers who make a clean offer that's not
encumbered with complicated contingencies.

It may take several offers and failed attempts to find the right
buyer. It isn't easy for most sellers to reach a successful
closing in this market. But those who stick it out can reach their
goal.

Waiting to sell could net you more for your home. But it's
impossible to know when that better time will arrive. The market
will be volatile. Good economic news will trigger a pickup in the
market. Bad news will cause buyers to pull back.

THE CLOSING: To take advantage of a pickup in the market, your
home needs to be on the market or ready to go on a moment's notice.