Whether you are buying or selling a Lake Gaston property, it can be quite an adventurous journey. Therefore, you need an experienced real estate professional to guide you on the path to your ultimate goal. In this world of instant gratification and internet searches, many sellers think that they can For Sale by Owner or FSBO.
The 5 reasons you NEED a Lake Gaston real estate professional in your corner haven't changed, but have rather been strengthened by the projections of higher mortgage interest rates & home prices as the Lake Gaston real estate market continues to pick up steam.
1. What do you do with all this paperwork?
Each state has different regulations regarding the contracts required for a successful sale, and these regulations are constantly changing. A true Lake Gaston real estate professional is an expert in the Lake Gaston real estate market and can guide you through the stacks of paperwork necessary to make your dream of "Living the Lake Life" come true!
We are often asked why there is, so much paperwork mandated by the bank for a mortgage loan application when buying a home today. It seems that the bank needs to know everything about us and requires three separate sources to validate every entry on the application form.
Many buyers are being told by friends and family that the process was a hundred times easier when they bought their home ten to twenty years ago.
There are two very good reasons that the loan process is much more onerous on today's buyer than perhaps any time in history.
1. The government has set new guidelines that now demand that the bank prove beyond any doubt that you are indeed capable of affording the mortgage.
During the run-up in the housing market, many people 'qualified' for mortgages that they could never pay back. This led to millions of families losing their home. The government wants to make sure this can't happen again.
2. The banks don't want to be in the real estate business.
Over the last seven years, banks were forced to take on the responsibility of liquidating millions of foreclosures and negotiating another million plus short sales. Just like the government, they don't want more foreclosures. For that reason, they need to double (maybe even triple) check everything on the application.
However, there is some good news in the situation.
The housing crash that mandated that banks be extremely strict on paperwork requirements also allows you to get a mortgage interest rate as low as 3.43%, the latest reported rate from Freddie Mac.
The friends and family who bought homes ten or twenty years ago experienced a simpler mortgage application process but also paid a higher interest rate (the average 30-year fixed rate mortgage was 8.12% in the 1990's and 6.29% in the 2000's). If you went to the bank and offered to pay 7% instead of less than 4%, they would probably bend over backwards to make the process much easier.
Bottom Line
Instead of concentrating on the additional paperwork required, let's be thankful that we can buy a home at historically low rates.
2. Ok, so you found your Lake Gaston dream house, now what?
There are over 180 possible steps that need to take place during every successful real estate transaction. Don't you want someone who has been there before, someone who knows what these actions are, to make sure that you achieve your dream?
3. Are you a good negotiator?
So maybe you're not convinced that you need an agent to sell your home. After looking at the list of parties that you will need to be prepared to negotiate with, you'll soon realize the value in selecting a Lake Gaston real estate professional. From the buyer (who wants the best deal possible), to the home inspection companies, to the appraiser, there are at least 11 different people who you will need to be knowledgeable of, and answer to, during the process.
Here is a list of some of the people with whom the seller must be prepared to negotiate if they decide to FSBO:
- The buyer who wants the best deal possible
- The buyer's agent who solely represents the best interest of the buyer
- The buyer's attorney (in some parts of the country)
- The home inspection companies, which work for the buyer and will almost always find some problems with the house.
- The termite company if there are challenges
- The buyer's lender if the structure of the mortgage requires the sellers' participation
- The appraiser if there is a question of value
- The title company if there are challenges with certificates of occupancy (CO) or other permits
- The town or municipality if you need to get the COs permits mentioned above
- The buyer's buyer in case there are challenges on the house your buyer is selling
- Your bank in the case of a short sale
4. What is the Lake Gaston property you're buying or selling really worth?
It is important for your Lake Gaston property to be priced correctly from the start to attract the right buyers and shorten the amount of time that it's on the market. You need someone who is not emotionally connected to your home to give you the truth as to your home's value. According to a study by Collateral Analytics, FSBOs achieve prices significantly lower than those from similar properties sold by real estate agents:
"FSBOs tend to sell for lower prices than comparable home sales, and in many cases below the average differential represented by the prevailing commission rate."
Why would FSBOs net less money than if they used an agent?
The study makes several suggestions:
- "There could be systematic bias on the buyer side as well. FSBO sales might attract more strategic buyers than MLS sales, particularly buyers who rationalize lower-priced bids on with the logic that the seller is "saving" a traditional commission. Such buyers might specifically search for and target sellers who are not getting representational assistance from agents." In other words, 'bargain lookers' might shop FSBOs more often.
- "Experienced agents are experts at 'staging' homes for sale" which could bring more money for the home.
- "Properties listed with a broker that is a member of the local MLS will be listed online with all other participating broker websites, marketing the home to a much larger buyer population. And those MLS properties generally offer compensation to agents who represent buyers, incentivizing them to show and sell the property and again potentially enlarging the buyer pool." If more buyers see a home, the greater the chances are that there could be a bidding war for the property.
Three conclusions from the study:
- FSBOs achieve prices significantly lower than those from similar properties sold by Realtors using the MLS.
- The differential in selling prices for FSBOs when compared to MLS sales of similar properties is about 5.5%.
- The sales in 2017 suggest the average price was near 6% lower for FSBO sales of similar properties.
Bottom Line
If you are thinking of selling, FSBOing may end up costing you money instead of saving you money. Get the most out of your transaction by hiring a Lake Gaston real estate professional.
5. Do you know what's really going on in the real estate market?
There is so much information out there on the news and on the internet about home sales, prices, and mortgage rates; how do you know what's going on specifically in your area? Who do you turn to help you competitively and correctly price your home at the beginning of the selling process? How do you know what to offer on your Lake Gaston home without paying too much, or offending the seller with a lowball offer?
Dave Ramsey, the financial guru, advises:
"When getting help with money, whether it's insurance, real estate or investments, you should always look for someone with the heart of a teacher, not the heart of a salesman."
Hiring a local agent who has his or her finger on the pulse of the local market will make your buying or selling experience an educated one. You need someone who is going to tell you the truth, not just what they think you want to hear.
Bottom Line
You wouldn't replace the engine in your car without a trusted mechanic. Why would you make one of the most important financial decisions of your life without hiring a real estate professional?
If you've been thinking about buying or selling a Lake Gaston property – Give Barney Watson Owner / Broker / REALTOR® with RE/MAX ON THE LAKE a call. Barney has many years of local Lake Gaston real estate experience. Barney has lived on Lake Gaston since 1988. He can explain the history and the unique characteristics of the lake to you. This is something you need to know before you begin your property search. Barney believes in continuing education. Designations equal additional education and Barney currently has more designations than any other Lake Gaston Real Estate Agent
He is a licensed real estate Broker in North Carolina and Virginia. He has earned the following designations:
- ABR – Accredited Buyers Representative
- ALHS – Accredited Luxury Home Specialist
- CHMS – Certified Home Marketing Specialist
- CRS – Certified Residential Specialist
- GREEN – National Association of REALTORS® GREEN Designation
- GRI – Graduate REALTOR® Institute
- RSPS – Resort & Second-Home Property Specialist
- SRS – Seller Representative Specialist
- SRES – Senior Real Estate Specialist
- SFR – Short Sales & Foreclosure Resource
- SPS – Strategic Pricing Specialist
- PSA - Pricing Strategy Advisor Certification by the National Association of Realtors®
- I am also a recipient of the RE/MAX Hall of Fame
You can reach Barney at cell: 252-532-3274