Protecting Your Investment in Your Home in Tougher Times
By Wayne Chaulk
Here are some things to be more careful about as we go through this most recent economic downturn which affects all of us to some degree or another.
Today, it is becoming more and more important to conserve energy and resources in our homes and protect this major investment. This also means you need to keep your property in good shape by maintaining things (minor and major) as they come up or better yet, take a preventative maintenance perspective to repairs and replacement. Actually it’s a good idea to get a professional home inspection done to truly take stock of the real condition of your home and then set to work to repair and replace any high lighted items and start that preventative maintenance approach I mentioned to longer term care.
Also do not over-renovate if planning upgrades. It’s hard to fully recover renovation costs when selling in the best of times, let alone in unsure times. If you are renovating, stay with more conservative changes unless you are definitely not moving or have little risk of having to move. Don’t go absolute “top of the line” unless you have a very sound financial situation and you can ride out a storm and keep your home long term regardless. For example, if a kitchen renovation includes counter tops, rather than install the absolute most expensive granite or quartz, choose a more conservative granite topping or a high quality arborite. Focus only on key ‘high return’ areas when renovating such as bathrooms, kitchen, roofing, flooring, windows if needed, services such as furnaces etc. When people become more cautious about spending on a home or acreage purchase, some will pull back on expectations and certain “niceties” they previously might have desired. There will always be those who have the money to buy ‘ideal’ properties in tougher times as an investment trying to take advantage of market conditions, but for most, we need to be careful to protect our one property – our primary home. So become more conscientious about maintaining your residence and enjoy that maintained home environment. You will also feel better about your property knowing it is thoroughly looked after.
A Few Key Important Considerations if you plan to sell in the near future:
Pricing – is still probably the key ingredient in successful selling and is particularly important in a “buyers’ market” like our current market! There are many advantages of proper pricing:
- You will be more competitive with other listings.
- You are likely to receive more serious offers, often closer to your list price.
- Likely more realtor activity and buyer traffic as buyers will realize your price is fair.
- Faster sale time reducing personal stress.
- It avoids discounting which creates negative attitudes towards a property.
- Keeps ruthless buyers at bay whose “low ball” offers may tempt a desperation sale on your part particularly if your property has been on the market for a very long time and is wearing you down.
Here are some signs of an overpriced property so you won’t make the same mistake:
- Property on the market for over the 4 – 6 months range. This could be even much more time for high priced real estate
- Series of price reductions on record but property is still on the market
- A comparitive market analysis by an experienced local realtor doesn’t match current pricing.
- Plenty of showings at the beginning of a listing but very few or none after the first 4 – 5 weeks.
- Avoiding any discussion on pricing even if no showings happening on the listing and other somewhat similar properties are selling in the area
Presentation – In our current market with buyers having plenty of choice and time on their side it becomes critical that your home is presented in its best possible light. Be ruthless in your de cluttering and make sure your home is clean, clean, clean! Paying to have your windows and interior professionally cleaned would be a wise investment so that your home sparkles! Ensure repairs are carried out on things that obviously need repair and touch up. Having professional advice on how to “stage” your home for resale will also create the “wow” factor that makes your home stand out from the competition. We have seen it happen time and time again that a well presented home gets the most attention and the best possible outcome in the selling process.
Patience - In a market that favours the buyers right now, one needs to be prepared that your property may be on the market for a longer time than in previous years. Right now, days on the market for country residential properties is averaging at least 90 to 100 days or more and Sales to Listing ratio is about 93%. Be prepared mentally for the fact that you will need to keep your home “show ready” for longer than you would wish.
These three “P’s” will serve you well if your plans are to sell in the foreseeable future. Next month I’ll address some ideas on how to make the wisest choice if you are planning on buying given our current economic climate. Even though we are in a buyers’ market right now, there are certain pitfalls to be aware of before you venture out to purchase and some buyers make these proven mistakes.