How is the market today for Los Angeles real estate sellers?
Right now we are in the situation of having tight inventory. Mortgage rates are low, buyers are looking, and sellers are not selling, maybe because they will not see much if any return on their investment, they are concerned about finding their own property, or they are simply waiting for the market to improve.
Los Angeles home sellers who price their property well are seeing multiple offer situations and often the home selling over asking.
If you are ready to sell, now is a great time.
Here are some things you will need to consider when selling your Los Angeles home:
Pricing your Los Angeles Home
Pricing is everything in today’s market. Even though, in many areas inventory is low and it is a sellers’ market overpriced homes typically stay on the market a long time and end up selling for less than the house priced at or below its value. Also, homes sitting on the market are perceived as having problems. Houses priced attractively are now receiving multiple offers and selling for over the asking price.
Your Los Angeles real estate agent agent will help you look at the comparable properties (comps) that have sold in the area, the only worthwhile comps which should be considered. Another property on the market and sitting unsold is not a comp.
Don’t be swayed by how much you love your home and think it is the best on the block. A Los Angeles home buyer and his or her agent knows what has sold in your area and the condition of the properties sold. That is what they are going to base their offer on. Unless the offer is unreasonably low be prepared to counter and negotiate a price both you and the buyer will be happy with.
Prepare your Los Angeles home for sale
Remodeling your home to encourage a higher price is not advisable. Your taste may not be a buyer’s and all you will hopefully recoup is the money you put into the remodeling. Simply presenting an uncluttered, clean home, maybe a freshly-painted outside, and nice landscaping to provide a good first impression is all that is needed in an older house.
Put your Los Angeles home on the market
Be ready for those open houses. You should not be home during open houses. It is also advisable to accommodate buyers as much as possible for private showings with your agent. Make sure you leave the home the way you would want a buyer to see it. The more neutral the better. A buyer needs to be able to envision the home as theirs, not yours.
If you do everything right, the offers will come in. Make sure you are available during the course of a listing to review offers. They are usually time-sensitive. Your agent will request paperwork to ensure that the buyer is financially able to purchase the house and go over the purchase contract with you. Main contingencies to consider will be:
- Amount of the down payment. The more a buyer is putting down the stronger that buyer is going to be
- Contingency removal dates – loan and appraisal are usually 17 days, although in this market this may be extended
- Length of escrow period – the standard is 30 days, but again, in this market a more realistic period would be 45 days
- Length of inspection period. The standard is 17 days, but this should be shortened to a maximum of 7-10 days. It is easy for a buyer to get all inspections done within that time period. If they need an extension for a reasonable cause this can be granted
- Make sure that the Buyer does not have to sell their home in order to purchase yours. This can hold up your sale with no guarantee that they Buyer will ever perform.
- Check for any other unusual requests that may delay the sale.
Make sure you understand what you will net from the sale after closing costs, including the agent’s commission.
What are the traditional responsibilities for Los Angeles real estate sellers?
- Seller’s portion of escrow fee
- Generally a home warranty for the Buyer.
- City Report (9A Report)
- Natural Hazard Report
- Retrofitting inspection and any corrections required after inspection. These typically are smoke detectors, low flow toilets, and braced water heaters.
- Carbon monoxide detectors to be installed
- Most important is the disclosure of any known defects or problems with the home if known.
Some of the above requirements are time-sensitive and part of the Seller’s obligation to the buyer if agreed upon in the contract.
Prepare for the escrow period: The Los Angeles home Seller also has to abide by various contingency periods. Make yourself available to sign the mass of paperwork that will be sent your way. Most of it is standard, but if you need an explanation, don’t be afraid to ask your agent.
During the course of the buyer’s inspection period a Request for Repairs may be submitted. This is something that will be negotiated. If a Seller refuses the repair request and the buyer does not wish to pay for repairs then the contract can be cancelled.
Once all the contingencies are addressed and, where needed, removed, the property is in solid escrow and the Buyer has basically “purchased” the home.
Close the deal. The Seller needs to be out of the home by the time stated on the day of close of escrow, usually 5:00 p.m. Everything should be in place to hand the property over to the new owners. Here is a checklist to get you started:
Cancel electricity, gas, lawn care, cable and other routine services. If the new owner is using the same services he/she will change the name on the account on the same day in order not to lose those services. Gather owner’s manuals and warranties for all conveying appliances.
This should help you move towards a smooth and trouble-free transaction.
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