Breaking News

Breaking News

by | Mar 18, 2024 | Buyers, Buying Conditions, Contracts, Home Staging, Listings, Market Trends, Mortgage, Real Estate, Sellers, Sellers-Contracts, Selling Conditions

Many of you may have already heard about the proposed settlement from the National Association of Realtors (NAR) in regard to commissions. Don’t believe the sensational headlines. Commissions have not been slashed nationwide! Our media has become so sensational in recent years! Here is what is going on and what you might be interested in knowing. The litigation, as I discussed in an earlier Ask Kathe (available at AskKathe.com), centered around Sellers offering to pay buyers agent commissions. As you can imagine, many buyers don’t have enough funds available to pay their agents themselves.  Sotheby’s parent company, Anywhere, already settled its stake in the litigation and the fall-out to consumers was simply that we had to inform sellers of their options when it comes to offering compensation to Buyers Agents and buyers of their rights and obligations under a Buyer Agency agreement. So what does this new proposed settlement mean? If the settlement is accepted by the court, then as of July (or sooner if adopted by a multilist (MLS) service):

  • Realtors will no longer be able to list in the MLS what a seller is offering to pay a buyer’s agent. This does NOT mean sellers will stop paying Buyers agents. It does NOT mean that we can no longer communicate to Buyers agents what the seller is offering. This does NOT mean that buyers cant request, as part of their offer, that Seller’s pay their buyer’s agent commission.  It just means we cant put it in the MLS.
  • Realtors will be required to have a signed Buyer Agency Agreement with a consumer before showing them a home. What does this mean? You will need to sit down with the agent before viewing homes to review and sign the Buyer Agency Agreement, by which you will be assuming the responsibility for payment of the Buyer’s Agent commission should the seller not be offering to pay your agent’s fee. Does this mean that you will get stuck with the fee (typically 2.5% – 3%). Not necessarily. 99% of our sellers are still offering payment to the Buyer’s Agent and if they are not, you can still request the fee be paid as a condition of your offer. Unless you are going to open houses, this suggests you will need to sign a Buyer Agency Agreement to view homes. Does this mean you can call an agent to see a home because it looks interesting? Only if you are willing to sign a Buyer Agency Agreement and choose that agent as your agent. What this means to you is you SHOULD NOT push “Contact Agent” on Zillow or any other website and then go see a house with a random agent. You should do your research and choose a Buyer’s Agent before you do anything else. Get educated on what Buyer Agency means for you. And then move forward with all of the benefits that Buyer Agency brings to you, the consumer!

My colleagues report that in New York City, the most expensive city in our country, Sellers are still paying Buyers Agents as they have in the past. It will add an extra layer to your Buyer Agent’s job to ascertain those offers before taking you to see a home so that you can understand your potential liability. This should also wake the consumer up to stop blindly choosing agents, such as  by pushing a “contact agent” button on a website, and take a minute to review agents’ websites online to learn about each agent’s qualifications and value proposition before signing up to be represented by them.

Experience Makes

The Difference

If you’re moving across town, from elsewhere in the state, or even relocating
across the country, I can help you find the perfect home! 

Connect With Kathe

The Importance of listing your home on the MLS

The Importance of listing your home on the MLS

by | Mar 4, 2024 | Buyers, Buying Conditions, Contracts, Helpful Tips, Listings, Security, Sellers, Sellers-Contracts, Selling Conditions

We have heard rumors lately of some homes selling outside of the MLS.  This seems like it might be easier if we want to sell our home.  How would you advise us? 

When inventory is very tight as it is currently, there are desperate buyers out there and many of them are bold enough to approach prospective sellers directly.  There are also occasions of homes selling with agents but in a “pre-MLS” sale situation.  As convenient as it may sound to sell your home in one of these scenarios, before you do so, it is imperative that you weigh whether your privacy and/or convenience is worth the tens of thousands (or sometimes hundreds of thousands) of dollars that you will leave on the table by making that choice.

The MLS is your most powerful tool for bringing the most money and the most favorable contract terms to your doorstep. If it is so easy to sell your home that it can be done with a single buyer approaching you and viewing your home, or an agent bringing in a buyer or two, then It is a near certainty that if you exposed it to the greater market, you would receive a much higher price.  When an agreement of sale is generated outside the MLS with such minimal effort, it is generally for one of two reasons. The first is that you significantly underpriced the property and the buyer knows it is a steal.  Even if you consulted with an agent in setting the price, market values fluctuate so quickly that the agent may not have been fully appreciating how the market would value your home.  Secondly, the market may be so starved for inventory in your price range that there may be a tremendous number of buyers seeking a home like yours, and one lucky one got there first with no competition.  Both of these scenarios benefit only one party to the transaction – the buyer.

If your net gain is a priority, don’t be fooled by promises of a quick sale.  Use the power of the MLS and pocket the highest possible profit for your home. Even when you are paying a Realtor, the profit you will net is most certainly higher than going it alone.  Reach out to me and we can discuss strategies for maximizing the value the market will yield for your home!

Experience Makes

The Difference

If you’re moving across town, from elsewhere in the state, or even relocating
across the country, I can help you find the perfect home! 

Connect With Kathe

The Impact of the New Court Decision on Pricing

The Impact of the New Court Decision on Pricing

by | Nov 27, 2023 | Buyers, Buying Conditions, Contracts, Helpful Tips, Listings, Market Trends, Property Value, Real Estate, Sellers, Sellers-Contracts, Selling Conditions, The Insiders Edge

Given the current focus on real estate commissions and buyer’s agents, how should I consider these changes when pricing my home for sale?

Understanding the true value of your property has always been a cornerstone of successful selling. However, in the light of the new real estate judgment, pricing your home correctly has become even more nuanced. Historically, listing prices took into account the commissions paid to both the listing and buyer’s agents as part of the overall transaction costs. With potential changes in how some commissions may be structured, sellers might consider these adjustments when determining their listing price.

First, it’s essential to recognize that the commission’s structure can influence the buyer’s ability to purchase. For instance, if buyers are now expected to shoulder their agent’s commission, this could effectively limit their purchasing power, which, in turn, might necessitate a pricing strategy that takes these new buyer constraints into account. Moreover, while it may be tempting to consider a higher listing price presuming that you, as a seller, might not have to pay the buyer’s agent commission, this approach can be shortsighted. A pricing strategy should not solely reflect changes in commission structures but also be grounded in a comprehensive market analysis. This includes an assessment of comparable sales, market demand, and the intrinsic value of the home’s features and location.

In theory, saving on the buyer’s agent commission might seem an effective way to boost your bottom line, but this overlooks a crucial aspect of the sales process—the appraisal.  Appraisers are keen observers of market trends, and they evaluate home values based on recent comparable sales, which include an analysis of the total transaction cost. If comparable sales in the area have typically included a buyer’s agent commission, appraisers may adjust the value they assign to homes where such commissions are not factored into the sale price. This means that by choosing not to absorb the buyer’s agent commission, sellers could face the risk of their property appraising for a lower value, which in turn could affect the actual sale price, potentially negating any anticipated increase in net proceeds.

It is essential to weigh the immediate financial benefits against the potential long-term implications of changing how commissions are handled. A property that’s listed without accounting for a buyer’s agent commission might initially seem more profitable for the seller but could ultimately lead to a lower appraisal value and, consequently, a reduced sale price.

Moreover, there’s the practical consideration of marketability. A home priced without a buyer’s agent commission might be less attractive to prospective buyers who expect this customary cost to be included. This could potentially limit the buyer pool and affect the number of offers received.

In these changing times, a nuanced approach to pricing your home is more critical than ever. A comprehensive pricing strategy, one that goes beyond just the numbers and understands the subtle dynamics of the current market, can make the difference between a home that sells promptly at the right price and one that languishes on the market.

To summarize, the shifting landscape of real estate commissions requires a thoughtful approach to pricing your home. An informed pricing strategy considers not only the seller’s potential net gains but also the home’s market value as determined by appraisers and the expectations of buyers. As you navigate these new waters, I am here to offer the expertise and guidance needed to price your home competitively and effectively. Reach out if you seek a partner in this journey—one who comprehends the intricacies of today’s market and is committed to achieving the best possible outcome for your sale.

Experience Makes

The Difference

If you’re moving across town, from elsewhere in the state, or even relocating
across the country, I can help you find the perfect home! 

Connect With Kathe

Preparation is Key for Multiple Offers

Preparation is Key for Multiple Offers

by | Jun 5, 2023 | Buyers, Buying Conditions, Contracts, Interest Rates, Listings, Market Trends, Property Value, Real Estate, Sellers, Sellers-Contracts, Selling Conditions

Are you still seeing multiple offers on homes these days? 

Believe it or not, yes! Despite higher interest rates, we are still seeing multiple offers, depending on location, condition and price range.  Multiple offers are primarily coming in the under $1,000,000 market.  If your home is in a higher price range, that does not mean that you won’t get an offer, and it doesn’t mean that it won’t be a good offer – but you may only get one, and you may need to wait for it – the market does not always offer instantaneous results.  The market is still strong, just not as crazy as it was a couple of weeks ago –the buyer demand is starting to be satisfied.

Multiple offers, over-asking-price offers and full-price offers are also far more likely in our hottest neighborhoods and historically most popular locations.  Additionally, sellers who have conditioned their home for market, both in staging and making changes to meet current buying trends, are most likely to be those with multiple and/or full price offers.  It is very important, however, to keep in mind that your initial asking price will dictate whether or not you receive a high offer.  If you choose to challenge the market with your asking price, and are at the top of your neighborhood, it’s unlikely your home will be snapped up or will receive an asking price offer – you may need to be patient and wait for a buyer who sees the value as you do.  On the other hand, if you price with last year’s prices, or shoot below market, you are far more likely to spur a bidding war.  Yes, we are selling at premium pricing on premium products, but this typically happens because the asking price feels a little on the low end to buyers to begin with. So my best advice to sellers is to take the time to condition your home to meet market expectations and then price carefully – no one wants to give their home away, but do be careful not to overshoot the market’s historic guidance on pricing.

Buyers – you still have a lot of competition out there.  If you are looking for a historically hot property (based on size, location or price range), you still need to plan to be very aggressive with your offers if you want to win, and make sure you are fully pre-approved!

Experience Makes

The Difference

If you’re moving across town, from elsewhere in the state, or even relocating
across the country, I can help you find the perfect home! 

Connect With Kathe

Understanding the Home Inspection

Understanding the Home Inspection

by | Aug 26, 2022 | Buyers, Buying Conditions, Contracts, For Sale By Owner, Helpful Tips, Home Improvements, Inspections, Listings, Property Updates, Property Value, Real Estate, Sellers, Sellers-Contracts

We find the inspection process confusing – do we have to fix everything in the inspection report before we close on our home or just the repairs the buyer requested?

The home inspection report is the document from which your buyer works to make their repair requests of you.  Some buyers will ask for everything and others will ask for only those items that they think are important. They may let some things go, for example, if they are planning on renovating an area and anticipate fixing those items as a part of the renovation.

Once you and your buyer agree on a list of repairs, these are memorialized on an addendum.  It is that addendum, called a Change in Terms Addendum (“CTA”), from which you work when completing your repairs. You need not refer to the inspection again unless the CTA references it. You do, however, need to make sure that you do everything on the CTA exactly as specified, so be sure to read it carefully and provide a copy to your contractor(s).  For example, if the CTA says that you will have GFCI outlets installed by a licensed electrician then you need to make sure you hire a licensed electrician, and not your favorite handyman, to make the repair! If the CTA says you must paint to match existing then you need to take a sample of the existing paint to the paint store and color match it – don’t rely on old paint in cans – paint fades with age and it won’t match.  Be very careful to be sure you are complying with the terms of the CTA – if you do not, or if your contractor does not, your closing may be delayed or postponed until the work is done as specified. Along those lines, be sure to review your contactor’s work when complete and make sure that he actually did what you agreed to do on the CTA.  If not, request that he return before it becomes a walk-through issue.

And of course, be sure to get paid receipts from all contractors, or if they have not been paid, notify the closing company so that they can be paid at closing.  All repairs must be paid for before ownership changes hands so be sure to stay on top of your bills, and provide receipts to the buyers agent.