One of the biggest challenges in today's real estate market is the continued demand for a shortage of home for sale properties. Because of the shortage, many homeowners who are looking to sell are considering pricing their properties higher than recommended.

For real estate professionals, it is important to advise homeowners to price properly, as opposed to trying to make them happy; if a seller marks their price too high, there may be consequences later. Homeowners who do not sell quickly are sometimes forced to lower their prices, which in term may cause buyers to stray.

University-distinguished Faculty Award recipient John Knight from Eberhardt School of Business - University of the Pacific researched the cost (in time and money) for a seller who price their home too high initially and were forced to lower.

In his article entitled “Listing Price, Time of Market and Ultimate Selling Price” published in Real Estate Economics, Eberhardt revealed that homes whose prices were revised later for a lesser price tended to be sold for less, compared to homes that were priced accordingly. He also revealed that the longer a home stayed on the market, the lower the selling price would be.

When homeowners have the mindset of “I'll lower the price later”, there may be consequences. Home buyers may think that something is wrong with the home, or they may take advantage of a desperate home seller. They may also low-ball the price and force homeowners to accept a much lower price than they initially hoped for.

A lot of home sellers may consider that pricing high will allow for “negotiation room”, however real estate professionals should warn home sellers that this tactic may eventually limit the likability of a home being sold. When one limits the demand for their home, it can create a negative impact on the sales price of a home for sale.

Consider this: It is becoming more common for potential home buyers to look for properties online, and here they have the opportunity to enter in their desired price range. A seller who looks to sell his home for $400,000 but has it listed for $425,000 for “negotiation room” will not even reach buyers who have entered in a preferred price range of $350,000 - $400,000.

The chart below displays how the higher you price your home over its market value the less chance potential buyers will actually see your home when searching.

The best strategy a home seller can adopt is to have the home priced properly at the very beginning, so that multiple offers are made on your home. This will allow potential buyers to compete against each other for the “right” price for your home.

Quite simply, if only one offer comes in for your home, you will have to settle into whatever demands the buyer has. In contrast, having multiple offers creates a better chance for you to choose which offer you prefer the most.

It helps to have a grasp on the current real estate market, and to have knowledge of the rest estate dynamics in your neighborhood. Being able to compare your home for sale than others in the area will help you get an offer a price that reflect its value and brings in more potential buyers.

Let us help you put together a successful sales plan for your home, so that you can sell at the price you want! Are you hoping to sell your home in Charlotte? Send us a message here or call us at (704) 997-3794 and one of our real estate professionals will be happy to assist you.

Having trouble selling your current home? Here is an article to know what seems to be lacking on your sale. Read 13 Reasons Why You Should Not Sell without a Real Estate Professional's Help.

Whether you're putting your home on the market this year or in the next five years, it is a smart decision to start building your home's resale value now. Here are some ways to create a comfortable home while making it easier to put more money into your bank account on closing day.

Small Maintenance and Repairs

If you think that home maintenance on the week-ends is a low priority, think again. The small chores you do around your home prevents it from losing value. Neglecting small maintenance and repairs causes 10% of your home's value to walk out your door and slip through your windows. Most appraisers claim that homes showing little to no preventative maintenance can depreciate from $15,000 to $20,000!

Preventative maintenance can also actively increase your homes resale value - according to a recent study, by about 1% per year! Also, because homebuyers generally notice any repairs needed upon buying a new home, proactive maintenance lets the homebuyer know that he or she will not have to spend extra money to maintain the basics. This makes your home more attractive, and thus more likely to get higher priced offers.

Remodeling Ideas and Tips That Work

Studies show that a home valued at $150,000 could increase is value between $8,300 and $19,000 with the addition of Landscaping. These studies also note that positive landscaping can reduce the amount of time your home spends on the market!

Changing out the doors of your home is also generally a smart design choice. Lately, fiberglass and steel doors are a coveted aesthetic by home buyers. A steel door costs $1,335 but has a whopping 91% return on investment. A fiberglass door, on the other hand, costs about $3,126 with an 82.3% return on investment. Likewise, a new fiber glass or steel garage door distinguishes your home from the rest on your block and provides a 91.5% return on a $1,652 investment.

Finally, matte paint finishes will trend in 2016 because of its transitional qualities. With a matte finish, your potential home buyer can easily match his or her stainless steel or black and white appliances. It's touches like these that make your home appealing to a wide variety of home buyers, and that drives up its resale value.

Your Needs and Buyers' Wants

On that note, if you need to renovate your home, be sure to consider how those changes will affect its appeal to future buyers. Knowing design trends will give you the opportunity to make changes to your home based on where your needs and your potential buyer's desires intersect, thus increasing your property's resale value drastically.

Designers and design websites provide great ideas when you're brainstorming home renovations. Keep in mind as you research, however, that you don't want to sacrifice your needs for a comfortable home just for the sake of what you think a future buyer will want!

Therefore, before you begin making any changes to your home, consult your real estate agent. Real estate agents, because we are constantly working with new buyer clients, have insider insight into what home buyers are looking for now and in the future. We'll be able to help you make smart choices when remodeling or renovating your home.

If you think you might want to remodel or renovate your home in the near future, or if you are just curious about other ways you can increase its resale value, please reach out to us at 704.997.3794. If you'd like to find out what your home is worth, visit us here for a free, no-obligation home valuation.

The Chief Economist at Realtor.com, Jonathan Smoke, reported that “All indicators point to this spring being the busiest since 2006.”

Freddie Mac is also supporting this statement and is saying that 2016 will be the best year that the real estate industry has seen in a decade. In their March Housing Outlook Report, Freddie Mac stated:

“Despite the challenges facing the housing market, we expect this to be the best year for housing in a decade. Home sales, housing starts, and house prices will reach their highest level since 2006 according to our latest forecast”¦Challenges remain, with low housing supply and declining affordability being a key concern in many markets, but on balance, the housing markets in the U.S. are poised for the best year since 2006.”

The 4 key research statistics pointing to 2016 being the best year in real estate in the last 10 years are:

• Low interest rates
• A resilient labor market
• An increase in household formations
• A projected increase in newly constructed homes

Bottom Line

2016 looks to be shaping up as a great year for residential real estate! If you are considering buying or selling this year in the Charlotte market, give us a call to discuss all of the options available! One of our team members can help you at (704) 997-3794.