Buying a lake home can be stressful, especially in this seller’s market, but it’s important to know you’re getting your dream lake home at a reasonable price. Lake Homes Realty’s CEO, Glenn Phillips gives four signs a lake home is grossly overpriced.
Days-on-Market: Lake homes don’t spend too much time on the market, and when they do, it’s an indicator of being unreasonably priced.
Big Appraisal Gap: If the listing price and appraisal have a large gap between them, it’s a clear sign the lake home is overpriced.
Back on Market: Sometimes, a lake home is back on the market after being listed as pending. This could be due to a buyer attempting to work with the exaggerated price, but realizing it would be a bad investment.
Massive Price Increase: When reviewing the price history of a lake home, take note if there was an alarming increase and whether any renovation has been done to the home to validate said increase.
Never spend more than you have to on your dream lake home. You never have to settle for overpriced properties when you know all the signs to watch out for!
Do you know what the term “seller net” means? “Seller net” is the amount of money a seller makes from a real estate transaction after all costs and fees are accounted for. When selling a lake home, there are many factors that could distract you from the overall “seller net” equation. In this video, Lake Homes Realty’s CEO, Glenn S. Phillips explains four reasons lake home sellers should focus on the “seller net.”
Cost of Selling. A common mistake most lake home sellers make is being fixated on the small details of home selling costs such as commission fees.
Time Matters. The time your house stays on the market affects your bottom line. Things home sellers often overlook are mortgage payments, insurance, and home maintenance costs that cost you more over time.
Brokerage Commission. If you pay a lower commission rate and get a lower price for your house, that could affect your “seller net.” In other words, you get what you pay for.
Service Level of Agents. When selling a home, it’s important to look for an agent that can provide you with exceptional service. This includes someone that is knowledgeable about your lake property and location and is capable of properly pricing your home for the best return on investment.
Whether you’re buying or selling your lake home or property, our agents at Lake Homes Realty can help provide insight into today’s lake real estate market and guide you in your home journey.
There is no doubt that we are now in a hot real estate market. What this means is that the demand for homes is high while inventory is low which oftentimes could fall in the seller’s favor. With that being said, before you rush off to put your home on the market, here are four need-to-know strategies that homebuyers are using in order to gain an advantage in this real estate market.
Apples and Oranges. It’s important to take a close look at your contract as many homebuyers can submit one that would make it stand out from competitors when in fact, it doesn’t offer much advantage over others, the only difference is that the language makes it sound more appealing.
Escalation Clauses. Oftentimes many homebuyers will submit escalation clause offers which in turn, puts your home into an auction environment. It can be a headache to sort through all of these offers so it’s important to understand the details and/or whether or not you would want to enter in an escalation clause.
Win Contract Then Decide. Many homebuyers are opting to win the contract and then using contingencies to buy time to decide whether or not they want to purchase your home. You must be aware of this strategy and allow yourself enough time to sort through all of the details in order to get the best offer for your home.
Aggressive Deadlines. Homebuyers will set short deadlines on offers in order to force the seller to make a decision. As a home seller, you must understand that there are more home buyers than there are homes available so it’s advantageous for you to take your time in order to make the best decision for you.
If you need a lake professional to help guide you on your home selling journey, our knowledgeable agents are available for assistance.
It might sound good to have your lake home sold in one day but it might not be in the best interest of you, the home seller. In this video, Lake Homes Realty’s CEO, Glenn S. Phillips provides four REAL reasons why real estate agents want to sell your home in one day.
Less work. If an agent is able to get your home sold in a very short period of time (which is very likely in a hot market), it’ll mean less work for them. Because of this, you may or may not get the optimal price for your home.
Commission is similar. Since how much an agent gets paid doesn’t differ much between a good sale price and a great one, there isn’t much incentive for them to go the extra mile to get the best return on investment for your lake property.
Self-promotion. Being able to move a property off the market in record time comes with its own “bragging rights.” But in some cases, it’s the hot market or high demand that is the leading factor behind quick sale transactions and not necessarily the effort that the agent is putting in.
Limit competition. In this current real estate market where the demand is high, agents oftentimes have buyers on hand that are ready to buy (sometimes within the hour!). If a quick sale is something you’re interested in, that’s great! But if you’re looking for the most bang for your buck, you might want to consider having other buyers join in. More competition will benefit you as a home seller since you’ll likely have more offers driving up your home selling price.
If you’re interested in selling your lake home or property and need a lake expertwho understands lake property and will help you get the most return on your investment, we’re here to help.
There is no doubt that right now is a hot market for real estate, but a high offer does not always mean you get that amount at closing. The highest and best offer are not always the same thing. If you are looking to sell your lake home or property, here are three reasons why the highest offer might not be the best offer for you.
Loan Contingencies. This means that if the buyer does not get approved for a sufficient loan, they can get out of the contract. This can be an issue if they give you a high offer that they are unable to follow through on, leaving you back at square one.
Inspection Contingencies. This can lead to negotiating the price if issues are discovered about the property. While these issues may not be a deal-breaker in your mind as the seller, they could be a way for the buyer to get out of the contract or leverage the price in their favor.
Appraisal Issues. With a high-priced market, the appraisal may not come back as high as the price you have set as the buyer. A bank will only loan out so much money, so the issue of who is going to come up with the difference in price can be a challenge. If a buyer does not have the means to cover part of the appraisal gap, their high price may not be as high as expected.
We hope you find these tips valuable as you venture out on your journey to selling your home. Please feel free to reach out to our lake experts for guidance.
Are you thinking of selling your lake home yourself? If so, you probably already thought about negotiating pricing and marketing, which are important, but there are other aspects you may not be ready for. Here are six dangers you must know before you do so.
Fair Housing Laws. You may want to get to know the people interested in your home, but if you look like you are filtering by demographics, check these laws to make sure you stay fair and abstract. Build a wall when making your selections because not only are you negotiating the property, but you are also vetting it as the seller.
Evaluating Multiple Offers. In a hot market, if you price your home appropriately, you will get multiple offers quickly. Are you prepared to evaluate those offers in a timely manner and how they all differ?
Inspection Contingencies. If someone makes a great offer, maybe in all cash, but they have a home inspection, it gives them a caveat to get out of the contract. It is important to understand what this contingency is, whether it introduces risk into your contract, and if there are problems, it could open negotiations or kill the deal.
Loan Contingencies. One great thing about lake properties is that over half the deals in our country are cash, but loans are still used as well. A pre-approval letter may not carry as much weight as you think, and if you accept a deal with this contingency, it could fall through.
Escalation Clauses. If the bids come in, that is typically the buyer’s offer unless someone beats it. These competing offers can become complicated because they can escalate to different amounts or triggers. Be prepared for this in a hot market because buyers do not want to miss out.
Property Disclosures. You must disclose the property and the issues involved otherwise you could be sued later. You need to understand what you disclose and what you do not disclose, which can be confusing.
Whether you’re buying or selling your lake home or property, our agents at Lake Homes Realty can help provide insight into today’s lake real estate market and guide you in your home journey.
In many of our Whiteboard Wednesday videos on the Lake Homes blog, CEO Glenn Phillips has covered why now, during a pandemic, is a great time to sell your lake house. But what if your lake home isn’t in perfect selling condition, and you want to take advantage of the market? In this case, you may be selling a fixer-upper — and there’s nothing wrong with that! If this is you, here are some helpful tips straight from top real estate experts across the country.
Focus on the Shell
If you’re selling a fixer-upper, don’t worry about the interior. Just make sure your home’s overall structure is sound so buyers will see the potential in your home. “When the shell is good, you care less about the interior finishes,” says real estate expert Steve Laret. “People come for the exterior. They are willing to chalk up deficiencies inside. What matters to people the most is that slice of water they can see from the cabin. How buyers value that is anybody’s guess.”
With lake properties specifically, one way to improve your home’s structure is by improving your home’s water access. For example, while you can’t change the water’s depth, you can install stairs and invest in a new boat dock. At the end of the day, buyers want to know whether they can store their boat at your home and how easily they can access the water.
Focus on the Market Now
The lake real estate market has undoubtedly changed since COVID began. On the one hand, people have been investing much more in lake houses because of the social distancing benefits, so it’s an excellent time for sellers. However, this trend may not last forever. Steve Laret warns, “Step on it before the fallout comes. This will likely be 18 months out from the start of COVID. Typically, that is how long it takes from something that’s shut down the economy to rear its ugly head.” If you’re looking to sell lakefront property, fixer-upper or not, it’s best to get it done right now before the eventual fallout. This trend is based on what happened in other devastating events such as stock market crashes and the aftermath of 9/11.
Know Your Price
Sometimes, as a seller, you can get into a state of disillusionment regarding the price of your home. We understand this. You’ve spent a lot of time at your lake house, you love it, and believe it should be worth a lot of money to any buyer. However, your bias may skew your perception. “If you’re selling a fixer-upper, have your realtor do a market analysis of your house as if it were already fixed up,” says Henry Washington, real estate investor who specializes in buying and renovating homes. That will give you a realistic value of the house after the home improvements. You’ll be able to include this in your listing.
Additionally, ask your realtor to give you information about rental prices per night on fixed-up properties. AirDNA is a good resource that provides analytics behind Airbnb to price your rental correctly.
A little bit of perspective-taking goes a long way. Ask yourself, “If I were a buyer and had to fix up this house, what would I be looking for?” In doing this, you should focus on the future. After all, you are not selling your current home — you are selling a vision for your current home’s potential. One way to cater to the buyer is to make small changes that will make your home more marketable. For example, Washington recommends replacing old light fixtures with more modern choices. “It can have a huge impact on the place,” he says. “It’s a pretty inexpensive fix that might help bring more offers in or sell for a higher price.” He also recommends updating the mirrors on bathroom walls to modernize the space. These are little ways to say to the buyer: “Look what this home can be!”
For more information about selling your lake home, connect with one of our many Lake Agents at Lake Homes Realty!
While it might sound good for an agent to have a lake home sold in one day, it may not be in your best interest as the seller. You may get a great offer that first day or that first weekend, but here are three reasons to hold off on deciding too soon.
Winning and THEN deciding. Some buyers will win the highest bid before they decide if they even want the house. They know the market is hot, so they will bid high and then decide to go through with the offer or renegotiate using contingencies. People who are more methodical will most likely not jump on the first day.
Fewer offers. You may get several offers the first day or first few days but waiting even two weekends will give time to the methodical buyers to think through an offer.
Out of town buyers. These buyers cannot come in a day. If you give a longer window of time, they will show up with intention and will often have the best deals for the seller.
There are different aspects to selling your lakefront property than if you were to sell a landlocked property. These are the surprising risks to be aware of when maximizing the return on your value and investment.
Sell really fast. Selling your home quickly will not get you the best return on your dollars. A lot of lake home buyers are from out of town or out of state, and you may limit the number of buyers that can’t respond quickly enough.
Rushing through the transaction. This is a legal transaction involving a lot of money and it’s important to read and understand what you’re signing. Avoid any legal issues in the future by taking your time.
Overpricing. The best way to get the best price is to price appropriately and leave room for competition. Overpricing drastically for the current market will cost you time and money, even in a hot market.
We hope you find these tips valuable as you venture out on your journey to selling your home. Please feel free to reach out to our lake experts for guidance.
