Common Pricing Mistakes

Looking to Buy or Sell Real Estate in Middle Tennessee? Contact a Living TN Agent today! Selling a home does not have to be a difficult process. If you have the right agent and set realistic expectations for yourself, you can get yourself into that dream home quicker. So what’s keeping most sellers from getting their home off the market? Pricing. Homeowners must understand that price and value are two different things so regardless of what you choose to “ask” the market ultimately determines what you net at the end of the day. Pricing a home can make or break a deal. It can be the difference between your home going under contract less than 24 hours after being listed, and sitting on the market for 6 plus months. To ensure that this doesn’t happen to you, avoid these mistakes at all costs.   Pricing too high Today’s buyers are extremely knowledgeable – they know a bad price when they see it. If your home is priced too high, buyers won’t give it the time of day. Once you realize your home is overpriced, it’s likely too late. Homes that sit on the market tend to have the perception that something is wrong with them. This is why it is imperative that you listen to your real estate agent’s guidance. Hours of market research and analyzing comps led them to this decision. Trust their expertise.   Don’t be afraid to go low. Pricing your home just right, or even slightly lower than current market value could get you into a multiple offer situation. In a multiple offer situation you stand to get the most amount of money possible out of your home. A multiple offer situation is similar to an auction sale. With multiple bidders, the price will keep rising until the highest bidder wins. Additionally, if something falls through with the highest bidder’s contract, you will have a qualified backup offer ready to go.   The agent who offers the highest price If you’re serious about selling/buying real estate, chances are you’re interviewing multiple agents. Don’t choose an agent because they’re offering to list your home at a higher price. If an agent offers to price your home higher than other agents you’ve interviewed, chances are they’re interested in listing your home, not selling it. This is a selfish practice that will cost you time and money. After sitting on the market, you will inevitably have to price drop and pray your home sells. Its called Buying the Business. They are hedging their bets that a buyer may come along out of the deal knowing that taking an overpriced listing is risky business.   Suppress your emotions You’ve spent years creating memories and spending hard earned money turning your house into a home. There is a lot of sentimental value surrounding your property but emotion must be compartmentalized. The emotional value of a home does not transfer to potential buyers. Your perceived value is not the actual value, so don’t let this be a factor in determining the list price. Once again, trust the experts.   As a seller you should be encouraged to know that these mistakes are easily avoidable. Make sure you work with the right agent and trust their judgement – your wallet will thank you. —————– Our experienced Living TN Realtors understand the current market conditions and are able to give you professional advice. They will work with you to navigate the local economic landscape and guide you in your selling decisions. To set up a consultation, please call us at (615) 425-3929 or email Kelsey@LivingTN.com

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Capital Gains Tax

Looking to Buy or Sell Real Estate in Middle Tennessee? Contact a Living TN Agent today! Whether it’s tax season or not, how much you may owe in taxes is a concern for all Americans. Since we’re dealing with real estate, let’s talk about capital gains tax and how it applies to you.  Capital gains are any profits resulting from the sale of an investment (Purchase Price – Sales Price = Capital Gain). If you ask the Internal Revenue Service (IRS), they will tell you nearly everything you own qualifies as a potential capital asset. However, capital gains most commonly apply to stocks and property sold for a profit. When it comes to selling your home for a profit, you can exclude capital gains taxes of up to $250,000 if you file single, and $500,000 if you file married filing jointly. Here’s how you qualify: Owned and lived in the residence for at least two (2) years of the five (5) years before the sale of the property, and; Haven’t excluded a capital gain from another home sale in the two (2) years prior to the sale. (Basically, you can only use this exclusion for a home sale every 2 years.) In the case of married couples, only one spouse must pass the ownership test. However, both spouses are subject to the residence rule as well as the home sale rule. Meaning both spouses must live in the residence for a total of 2 years but both are not required to be on the title.   If you don’t qualify for the exclusion, your capital gain is subject to the tax percentage associated with your tax bracket. To get an idea of how much tax you will have to pay if you don’t qualify, check out this handy Capital Gains Calculator. The tax rules as they relate to capital gains can be either simple or complicated depending on your specific situation.  If you want to learn more or have questions about buying or selling a home this year, give us a call at 615-933-1000 or email us at info@LivingTN.com!

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Get Pre-Approved

Looking to Buy a home in Middle-Tennessee? Start your home search today! Nobody wants to find a home that they love just to watch someone else move in because they were able to act faster than you were. Homes are going fast and the best way to get the home you want is to talk to a mortgage professional to get pre-approved before you even start looking at homes. You would think this is a no-brainer, but buyers rarely get an actual pre-approval before starting their home search. By getting pre-approved first, you will be ahead of the competition because…   You’ll know what you can afford. Getting pre-approved first will let you know what your price range will be and how much you’re willing to spend.  It also gives you an idea of any additional costs you may have such as closing costs, fees, and insurance.  This allows you to create a budget before you even find a home and puts you in a better financial position. It saves you time! By knowing your price range, you don’t have to worry about looking at homes you could never be approved for.  This helps you better search for those hidden gems by spending more time looking at the homes you can afford.  This also puts you in a position to quickly make an offer when you find a home you love. You show the sellers that you’re a motivated buyer. Having a pre-approval letter lets the sellers know that you are serious about buying. When multiple offers are made on a home, being pre-approved can move you to the front of the line.  In some cases, realtors and homeowners will not even accept offers from buyers without a pre-approval. It increases your negotiating power. Since your approval is essentially a “done deal” when it comes to buying a home, the seller may accept your offer even if other offers are slightly higher in price. If the seller chooses an offer that is not pre-approved, they run the risk of the sale falling through. This automatically gives your offer more weight because it is more of a “sure thing”.   It’s important to note that a pre-qualification is NOT a pre-approval. The borrower will need to provide financial documentation to the lender in order to receive a pre-approval. Don’t be on the wrong end of an offer!  Be prepared! Contact a professional at Living TN to make sure you get the home you want. Call us at 615-933-1000, or email us at info@livingtn.com

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