Remember back in the day, where the Realtor would bake cookies or an apple pie to help put prospective buyers in a buying frame of mind.  Well, now days it takes more than making your house smell warm and inviting to make it more appealing to those who come to look at it.  It’s take careful planning and knowing how to leave a lasting impression on the home buyers.

Two simple words for you, Home staging is the act of preparing a home (and the contents of the home) for sale, with a special emphasis on presentation and appearance.  By decorating and arranging a home’s interior to present an ideal way of life, buyers are assisted in visualizing themselves in your home. 

Basically, there are five steps to home staging.

• Clean it up
• Getting rid of clutter
• Depersonalizing
• Decorating and accessorizing Maintaining

Clean it up

Even though it may be tough to live in a spotless home ALL the time, this is a necessary change when selling your house.  Make sure you maintain the clean you’ve achieved, even if it requires hiring a house cleaning company.

Getting rid of clutter

Remember that how you live in your home and how you sell your house are two entirely different things. You’re going for a “show home” look! Go room by room, closet by closet, and look at every item. Then decide whether or not you will keep it or donate/sell it!

Depersonalizing

Your charming family pictures, children’s artwork on the refrigerator, and shelves full of sports trophies may mean a lot to your family, but it makes buyers feel as if they are intruding in personalized home. Pack away your personal items into storage.  This help buyers picture their things in your home without having to get past your personal belongings.

Decorating and accessorizing Maintaining

You don’t need to spend a fortune. Even fresh flowers in a vase brighten a bathroom counter. A fresh coat of paint doesn’t cost very much but will add a lot of impact.  New window treatments, fresh flowers, green plants and pretty accessories all pack a punch without breaking the wallet.

By Janette Woodruff- Whitlock, Sr. Mortgage Banker

United Capital Lending

Norfolk, VA  – There is a great debate within the inner-mortgage circles these days. Should we, as loan professionals, encourage clients to borrow as much money as possible? Or would consumers benefit more if we helped them to understand the advantages of 15-year amortization schedules and pre-paying principal? Let’s examine the pros and cons of both strategies.

Leveraging Your Property. In order to understand why you’d want to borrow as much as possible for your home purchase, you must first grasp the concept that equity has a zero rate of return. Here’s an example:
 
If Consumer “A” buys a home for $300,000, and puts 20% down, then they have $60,000 in equity. Over the next 5 years, the property appreciates $100,000 in value. Consumer “A” now has $160,000 in equity.
 
Consumer “B” buys a home for $300,000, and puts no money down. At the end of 5 years, that same home is now worth $400,000. Consumer “B” has $100,000 in equity, which is the same appreciation as Consumer “A”, a net $100,000.

 
As you can see, your down payment has nothing to do with your rate of return. What becomes important is how you choose to manage the $60,000 you didn’t use as a down payment. If you use it for frivolous activities, such as buying toys or going to Las Vegas, it would be more prudent for you to use that money as a down payment. Especially since this will enable you to obtain a lower interest rate.

However, if you were to invest the $60,000 in a vehicle that can out-earn the cost of that debt, then this could be a formula for success. This is why some lending professionals suggest putting as little down as you possibly can, maximizing your tax write-off, and investing the rest. This principle has been applied for many years in the life insurance game. The old saying goes, “Buy term and invest the rest.” The key component is taking the money you would have used as a down payment and creating an asset accumulation account. This account should earn a significant enough rate of return to enable you to pay your mortgage off entirely and achieve the ultimate goal of being debt-free.

Paying Your Home Down Rapidly. There are very few times over the course of my career that I have seen a client with zero debt and no financial difficulties. Choosing to pay off all of your debt can reduce stress and help you to gain freedom of cash flow for investment opportunities. A 15-year mortgage or a bi-weekly payment strategy provides structure. It can also put you on track to have your mortgage paid off within a set timeframe. Simply put, it contains built-in discipline.

It’s important, however, to understand that regardless of how rapidly you pay your home off, you’re not getting any greater rate of return on your investment than if you paid it off slowly.

Conclusion. So how does one determine which scenario is best? The choice depends entirely upon the individual. Savvy consumers who are disciplined, and are comfortable taking chances from an investment perspective, would do well with the first scenario. Over the course of time, it’s been proven that your rate of return over the long-haul will be far greater than the rate you’d pay for a mortgage in today’s rate environment. It’s important to seek the advice of a skilled investment advisor to ensure success with this strategy.

The second scenario is best for those who have a difficult time managing their money or who’ll sleep easier at night knowing they have a plan in place to pay their loan off more rapidly. Be sure that your budget can handle accelerated payments. When consumers “bite off more than they can chew” with a 15-year mortgage, they frequently end up having to refinance back into a 30-year schedule.

If you find this subject intriguing and would like to know more, I recommend that you read a book titled, Missed Fortune 101, by Douglas Andrew. It’s an outstanding read that is very simplistic and goes into far greater detail than I can cover in this column. Douglas is a financial planner who advises safe-structured investments such as whole life policies and tax-free fixed income instruments.

If you been reading the newspapers or watching your local news you know how stressful the process of selling a house can be, especially in today’s market, with house prices falling dramatically back to early 2006. Added to this, there is a shortage of potential buyers, a higher stock of unsold property, meaning your house could be on the market for months, more likely years. When you do eventually get a buyer you are still such to a lot of demands to fix the repairs before they are willing to buy or a buyer pulling out simply because they have changed their minds. It is a buyers market today and any qualified buyers are looking for the perfect deal.

Home owners who are perhaps looking to relocate, or who are going through separation or divorce, or are currently experiencing debt problems; simply don’t have time to wait the months or years for their home to sell on the open market.  “Sell My Newport News, Virginia House Fast!” is something that our company hears allot from people in Newport News, Virginia, but what is amazing is so few people are aware that this is easier than they thought.  We don’t care about all of the work that needs to be repaired. We buy houses that need roofs, new cabinetry, flooring, and more. We buy houses that even have a poor foundation. Any home can require serious repairs and we are willing to talk to you because we buy houses in Newport News. It can be very difficult to sell a home when it needs a significant amount of repair. There are buyers who are picky about the Newport News homes they buy but there are also some who will buy Newport News houses that are in any state or condition (meaning, even the most dilapidated ones can be sold nowadays.) But be reasonable – you cannot expect a dilapidated and unwanted home to command the same market price as a well-kept and beautifully-designed home. That would be like saying an ugly and run-down car is sold at the same price as top-of-the-line advanced and new car models. It just isn’t realistic.

What would be realistic is if you were to sell your Newport News home and look into the following factors that may influence its sale price:

1)      What was the original price at which you bought your home, or had it constructed for? This gives you a baseline from which you shouldn’t budge when given offers by potential buyers.  Into the market price of any house, you will have a built in real estate sales commission of 6%-7%. That is a realtor’s commission and in reality 95% of the homes sold in America are sold through realtors. The reason for this is that most sellers don’t have the time and money to market there house properly and spend all day and night showing it to prospects. Even if they do, they realize that most of the prospects they are showing there home to aren’t really prospects because they can’t get financing to buy the house anyways. Sellers recognize that this is a tremendous waste of time and money….not to mention how frustrating it is. And, even if they don’t mind doing all of that, they probably haven’t sold more than 2 or 3 houses in there life anyways, so they are not familiar with all of the problems that will pop up along the way. Anyways, take $7,000.00 out of your sale price for realtor’s commission. That leaves you with $93,000.00.

2)      Contrary to some sellers beliefs, homes typically do not sell at full market value,    even if that is the price they are listed at. Buyers almost always negotiate at least a little bit off the asking price. Offers typically come in and are accepted at approximately 5% off the asking price. Studies have shown that is the national average. So, that’s another $5,000.00 off your price which brings you to $88,000.00.

3)      Sellers of homes often pay points on the new buyer’s loan as part of the sale, especially if the new buyer’s loan is an FHA or VA loan. Two to six is typical. Let’s take the middle of the road and go with four. That’s $4,000.00, which leaves you with $84,000.000

4)      Then there are “fix-up” costs. While most people selling there home may not see a bunch of things that they feel need to be fixed up, buyers will. It makes sense that you as the seller may not see everything that really needs to be done because you are either living in the home and have become used to seeing certain things as minor or non existent, or are expecting a best case scenario house sale….which never really happens. Unless you plan on making your property into mint condition, you can expect the sales price to reflect the work that needs to be done. Let’s say you can get away with a couple minor updates to the property which cost you only $1,000.00. That puts you at a total of $83,000.00. Now, if there are any truly noticeable issues with the home, such as roof repair needed, holes in walls, carpet or tile needed, damaged areas, plumbing or electrical problems, structural problems, etc. it can be very expensive. If a property needs this kind of fix up, a bank will not even give a new buyer a loan to purchase your property. You see, as you probably already know, when someone is going to buy your home they will have an inspection done prior to closing. This inspection is reviewed by the bank who is considering giving the buyer a loan. If the inspection lists any problems, the bank will tell the new buyer that they won’t give them a loan until the problems the inspector found are fixed. This will have to be done by a licensed contractor, not a regular handyman, which is obviously expensive. You will be expected to pay for this if you want to sell your house. And, if you think you will just find a new buyer and sell to then, think again. By law you are required to disclose any know defects to the buyer prior to sale. The defects are now documented by inspection reports and if you don’t disclose them to new prospects you are asking for a big lawsuit and other penalties. So, if you think your house may have some challenges when that licensed inspector shows up to inspect your house, you may as well spend the money and fix them now. Let’s just say that there’s a minor problem with your home that requires a contractor to fix, like a leaky roof. That could be a couple grand on the low side. If the inspector said you need a new roof, figure at least five grand into the equation. Obviously, this could get real expensive real fast.

5)      Home warranties are the new craze these days when it comes to selling a home. This is a warranty that is purchased to protect the new buyer. It is similar to an extended warranty on a car. They run about $400.00 and are paid for by the seller. Most sales contracts require them to be provided. So, you are now at $82,600.00.

6)      Even in a best case scenario, most buyers require sellers to allow $500.00 to cover repairs that an inspector finds. They never want to leave that $500.00 unused since the seller is contractually required to honor it. So, take another $500.00 out of the price, which leaves you with $82,100.00.

7)      Then there’s the cost of fees that all sellers are required to pay. With escrows, title insurance and our state doc stamps (taxes on property transfer), it costs sellers around $3,500.00 on a $100,000.00 house sale. That leaves you with $78,600.00.

      Now, lets say the process of finding a qualified buyer and getting them to the closing    table takes a total of two months ( 30 days to find a buyer to put the house under contract and another 30 days for the buyer and house to qualify for financing), that two more payments you had to pay to your lender. Say your payments are $1,000.00, which leaves you with $76,600.00.

If you decide to sell your home, then we are here to buy your home and we have astonishing set of investors who can make rapid offers to buy your house in Hampton Roads within a week. If you are wanting to Sell your house in Hampton, Newport News, Poquoson, York County- Yorktown, Williamsburg, and James City County, Hampton Roads / Tidewater cities of Suffolk, Norfolk, Virginia Beach, Chesapeake, Portsmouth, Smithfield, Isle of Wight, Richmond, Virginia home Fast, then we can help at 757-593-1393 or visit us online http://www.757webuyhouses.com.; in any condition whether it is ugly or pretty. Community Housevestors gives you the best offer and quickly. We believe in providing uncomplicated deal, superior deal and superb deal.  Home owners who need to sell their home fast love the program of a we buy houses company. Their policy is simple: no fees, no commissions, and no closing costs. Many homeowners are opting to utilize the services of a we buy houses company in Newport News due to the ease and simplicity. Why wait 6 months to a year with a Realtor when you can simply call a we buy houses organization.