What To Do If Your Home Won’t Sell?

September 8, 2009

Make Sure Your Home Reflects the Current Market Value

This just in: It takes longer to sell your home now than it did two years ago! Just kidding! If that’s news to anyone, you better go back a few blog posts and start reading!  The truth is we know the minute we even start to THINK about selling our home that it’s most likely going to be a long process. The reason for this is simply supply and demand. With the credit crunch and housing hold - some people are waiting several months before they even get a nibble! Then there are others who can put it on the market and have it sold within a month! So what’s the difference? Surely if you’re selling your home in today’s market, it is most likely out of necessity, such as to avoid foreclosure, job relocation, or you really need to upgrade or downgrade. Whatever it is, if you’re home has been on the market longer than you thought it would, consider trying something new!

Reduce, Remodel, or Rent?

One of the biggest reasons homes today don’t sell is because the seller is under the illusion that they’re house is worth more than what the market says it should be. In other words, ignoring their home’s market value. You may have a beautiful cap code home in a pristine neighborhood, with great schools and you’ve heard (at some point) that a home like yours could sell for half a million dollars. Well, that was probably two to three years ago. Today however, the average market value of a home has seen a 17% decrease since those days. Because there are so many other houses on the market, your home, in order to sell quickly, needs to reflect the market changes and even be more competitive!

• SELLING TIP: Sellers whose homes aren’t selling should analyze their asking price and compare it to the market value. Ask your real estate agent for help. You can also look at similar homes to see what they were asking compared to how quickly they sold.

If that doesn’t work, try remodeling. Whatever you can afford. One coat of fresh paint can go along way in increasing your home’s appeal both inside and out. (By the way, for great repainting tips, we highly recommend getting an online paint color consultation from PaintYourSpace.com). From changing fixtures to full room remodels. If you’re home isn’t selling, take it off the market temporarily and do some work to it. Then when you’re ready to start again, give the listing a whole new look! This keeps it fresh in the eye of potential buyers!

• SELLING TIP: Keep in mind that you don’t have to do a huge remodel to get the most value out of your home. Look online for simple projects and crafts and staging ideas that are sure to add appeal and even value ($$$) to your home.

Finally, have you considered searching for a tenant rather than a buyer? It might be a good option for some of you - especially if you’re less flexible with adjusting the selling price. By renting your home, you can have help making the mortgage payments, and can hold off actually selling until the market improves. However, this can also be a risky move. Before going down this winding road… talk to a tax adviser. The tax laws affecting single-family residences differ from those of income-producing properties. In addition to the tax laws, you’ll also want to become well-versed on landlord vs. tenant laws and regulations. Do your research and know what you’re getting into before asking someone to live in a home you plan to sell in the near future.

• SELLING TIP: One tax benefit of owning your home is that you’re entitled to $250,000+ tax-free gain when you sell, but restrictions apply. In most cases, you’ll need to have owned AND occupied your home for two out of the last five years. If you’re looking to move out of the area while renting your property, this could pose a problem when you do decide to sell.

Whatever the reasons you have for selling today, be sure that you’re well informed of your choices you have. If you were to ask a financial adviser for your best options, they might tell you now is not the time to sell, but it is certainly better than it was six months ago. My point is there are ups and downs to every road and the best thing you can do is to know what the right choice is for you.