3 ways to make your home attractive to buyers (that have nothing to do with staging and curb appeal)

What is the number one fear of most homebuyers? That the home they have fallen in love with is a “lemon,” and that there will be future issues that will cost the buyer a fortune.

Sure, a professional home inspection can alleviate many of these nagging doubts, but there are other things a seller can do to induce confidence in homebuyers. Things that your competition is most likely not offering.

1. Check your warranties

Have you had any work done to the home? Whether it was replacing a water heater or HVAC system to installing irrigation in the backyard, you hopefully have a warranty or two for the work performed.

Read over the terms of the warranties, looking carefully for whether or not any of them are transferable. “When allowed, warranty transfers are subject to the manufacturer’s terms and conditions so be sure to review the warranty for this important information,” cautions Annie Crawford at GAF.com.

Transferable warranties, especially on pricey items, such as HVAC systems and swimming pools, are a confidence booster for homebuyers, and an excellent marketing tool.

2. Gather renovation records and receipts

Not only do homebuyers love improvements to a home, appraisers do too. Therefore, it’s always a good idea to have on hand, for both parties, receipts and records of any renovations performed on the home.

Offer to make copies so that the buyer knows which contractor to call if service or repairs are ever required.

3. How old is that …?

Savvy homebuyers will ask their real estate agent to find out the age of the pricier systems in a home. These include the HVAC system, roof, electrical system and water heater, among others.

If you’ve had routine service performed on any system in the home (especially the HVAC system), dig out the records to prove this. It’s valuable information for both your bottom line in the home sale and for the buyer’s confidence in the home.

Take these three steps to make your home more attractive to buyers and watch the offers roll in.


What’s going on in the real estate market?

To say that our neck of the woods is wildly popular would be an understatement. From national press accolades as one of the country’s best places to live to excellent schools, our communities offer an unparalleled lifestyle.

Its popularity is one reason that our market is being particularly hard hit by a low inventory of homes for sale. With far more buyers in the market than homes to sell, prices are soaring in response to the demand.

How is “inventory” determined?

Real estate professionals answer a hypothetical question when determining the absorption rate for the current inventory of homes for sale:

“How long would it take to sell every listed home if no new homes came on the market?”

Finding the answer requires using a specific calculation that results in a “months of inventory” figure.

As of this writing, U.S. Existing Home Months’ Supply is at 3.30, which is up from 3.10 the previous month. In fact, the inventory of available homes has been steadily increasing, month over month, since December of 2022, according to research from the National Association of REALTORS.

Most real estate professionals agree that an inventory of 5 or 6 months is a sign of a balanced housing market. We still have a way to go to reach either of those numbers, but the steady increase over the past 10 months is encouraging for homebuyers.

This is where we are right now – a market that still favors sellers, but is in flux. If you hope to take advantage of the sellers’ market, jump in soon.

Why are there so few homes for sale?

The reasons behind our low inventory situation are multi-pronged.

Mortgage interest rates

Not only are rates higher than they’ve been in some time, but folks who bought when they were super low are reluctant to sell. “… homeowners don’t want to give up their low mortgage rates,” according to Holden Lewis at NerdWallet.com.

Baby boomers (born between 1946 and 1964)

Our older generation is taking much of the blame. Surveys of this generation of homeowners (33 million are owner-occupants), find that the majority of them have decided to age in place. Plus, they are concerned about number 1, above, losing their current low mortgage rate if they sell and then buy another home.

Home builders

“New home sales are up almost a third compared to last year, even as sales for existing homes remain in the doldrums,” claims Diccon Hyatt at Investopedia.com.

Sounds like good news, right? Not so fast.

Those higher interest rates aren’t only hurting homebuyers. Builders need credit as well and financing their projects has become vastly more expensive.

While housing permits have increased, completions have dropped to the “… lowest level since January 2022,” according to Lucia Mutikani at Reuters.com.

Finally, investors who have been snatching up homes over the past few years are seeing rents rise at an astonishing rate. “Those investors have no incentive to sell,” Dennis Cisterna, CEO of Investability Solutions tells Lewis.

What are you waiting for?

If you’re thinking of selling your home, why are you waiting? With each increase in mortgage rates, a certain number of potential buyers leave the pool. If those numbers grow larger, the market will change and prices may begin to come down.

Right now, your home value is most likely at a record high and buyers are clamoring for homes. If ever there was a better time to sell a home, this is absolutely it.

Many would-be sellers tell us that they’re hesitating because of a fear that they won’t be able to find a suitable replacement home. Buying a home while trying to sell one can be challenging, but we offer brilliant solutions that make the process far less stressful.

Please reach out to us if you have any questions about the real estate market here in our corner of the world We love to talk about real estate!

3 Things you absolutely must do before the open house

Yes, there aren’t enough homes for sale for all of the buyers who are dreaming of buying one. The good news for homebuyers is that the inventory of available homes has increased, month over month, since April of this year (realtor.com).

Let’s hope that trend continues, for buyers’ sake.

As for home sellers? If you are putting your home on the market soon, pat yourself on the back. The inventory will, someday soon, get back to normal. When it does, there will be plenty of competition among home sellers and prices typically drop in these situations.

You will get more for the house right now than in a buyers’ market. Especially if you ready the home for the spotlight.

1. Clean anything that’s gross

Potential homebuyers look at just about everything in your home. They open drawers to see how roomy they are, they open closets for the same reason.

They open kitchen appliances if they’re included in the sale.

Many homeowners learn to live with the gunk that accumulates inside appliances, such as the oven, refrigerator and dishwasher,  without performing routine cleaning. Open house attendees will consider it disgusting.

Ensure that any appliances that will be included in the sale are impeccably clean, inside and out.

Clean the toilet until it sparkles, get rid of soap scum in the bathtub and hang up fresh towels.

2.Don’t ignore your curb appeal (or lack thereof)

We like to ask our listing clients to go outside and stand at the curb in front of the house. Ask a friend or neighbor to accompany you.

Take notes of what you see and ask your companion to do the same. Since this spot, at the curb, is most likely where potential buyers will get their first in-person glimpse of the home, look at it with a critical eye.

Are there any turnoffs? These can be anything from chipped or peeling paint on the fascia to dead plants and torn window screens.

Transform that area of the home into a magnet that draws people out of their cars and into the home.

3.Don’t leave home without them

Common home-selling practices include the fact that the homeowner should not be home during the open house. Your real estate agent will act as your representative to all that attend.

Your real estate agent, on the other hand, isn’t responsible for ensuring that the home is clean, that the landscaping is in top shape and that your pets aren’t present.

Yes, it’s a terrible inconvenience to have to find a place for your pets for several hours. But it is critical. Here’s why:

  • Many people are allergic to dogs and/or cats. Just looking at them may psychologically trigger their allergies.
  • An intense fear of dogs. Nobody knows how many people suffer from this phobia but the experts at the Cleveland Clinic claim that “… fear of animals is one of the most common types of specific phobias.”

They also say that “… about 1 in every 3 people with a phobia of animals has an overwhelming fear of dogs.”

  • With all of the people coming in and going out of the house, your pets may get out.

Many homeowners think that they can get around these issues by crating the animals and keeping them in a closed-off-to-open-house attendees room.

It’s something most listing agents discourage. Potential buyers will wonder why it isn’t available to view. Think of it this way:

Would you buy a car from a seller who refuses to allow you to look in the trunk?

There are many ways to deal with the pet conundrum:

  • Schedule their grooming for open house day
  • Ask a friend or family member to watch them
  • Take them to a pet daycare center
  • Hire a dog walker for a few hours
  • Take the dog to the park
  • Negotiate with a boarding facility for an hourly rate


Shopping for a home? Pay attention to the neighborhood

Homebuyers enter the home shopping process with one of two mindsets. There are those who know what kind of house they want – the number of bedrooms and bathrooms, the type of kitchen and maybe whether or not they want a yard.

Then there are those who know where they want to live, such as a specific school district or neighborhood, but haven’t completed a wish list of home features.

Seldom does a homebuyer tell her real estate agent that she wants a “3-bedroom, 2-bathroom home with a gourmet kitchen, a fireplace and a pool in the backyard, located on J Street in the Mountain Shadows neighborhood.”

While the features you want in a home are important information for your real estate agent, “location, location, location” is just as important, important, important.

Even if you’re among the group of homebuyers who know exactly what you want in a house and perhaps have one picked out, it’s important to scope out the neighborhood before committing fully to buying.

Don’t Believe What You Hear

Especially when you are new to an area, it’s easy to believe what residents tell you about the various neighborhoods.

“When I was getting ready to move to Las Vegas 10 years ago I went online and read about the various neighborhoods,” recalls Veronica Thomas. “The consensus seemed to be that Green Valley and Summerlin were the best places to live.”

On a weekend trip to check out the areas in person, Thomas found that neither area suited her. “Green Valley was far too congested for me,” she said.

“Summerlin was way too far from my job on the Strip. I’d heard that both had low crime rates but they weren’t that much lower than some other areas I found much more attractive,” she concludes.

There is nothing quite like first-hand information. If good schools are important to you, do the research yourself instead of relying on what others consider “good.” GreatSchools.org lists schools’ test scores and features reviews from parents.

Crime statistics can also be found online. The FBI offers a nationwide Sex Offender Registry on its website and Neighborhood Scout boasts that they “reveal the safety from crime for every neighborhood in America.” Finally, call the police or sheriff’s department in the area for more information on crime statistics.

Google Maps will allow you to map a route from the new house to your job, to a particular school or to the nearest shopping center and kick back the mileage and a rough estimate of the time it will take to get there.

A lot of your preliminary neighborhood research can be done online, but it’s not a substitute for actually checking out the neighborhood in person.

Drive It

Number three on the list of the 5 biggest mistakes homebuyers make when choosing a neighborhood is underestimating or ignoring the commute, according to MSN Real Estate. Their advice is to actually make the commute during normal commute hours to see if it fits your lifestyle.

Drive through the neighborhood at different times during the day and evening, on both weekdays and weekends, looking for anything that may be considered an annoyance.

Music blasting from a teenager’s open bedroom window when you’re trying to unwind after work may make you wonder why you bought a house in that neighborhood in the first place. Is the house under the airport’s flight path? Kids – and all that they imply – may be a blessing or a curse, depending on how you feel about them.

If you don’t drive, walk the neighborhood. Locate the nearest public transportation stop and see for yourself what the walk is like to the store and other local conveniences.

Check Municipal Records

Finally, check the neighborhood and surrounding area for anything that may impact the home’s value. Look for:

  • A high number of foreclosures nearby
  • Developments in the works
  • Upcoming zoning changes

Sure, it’s important to fulfill those dreams of the perfect house for you. But the bigger picture – a suitable neighborhood in an area that fits your lifestyle is what will, according to MSN Real Estate’s Melinda Fulmer, “determine whether you’re living the American dream or just living.”

The 3 Most Important Real Estate Documents You’ll Sign

The process of purchasing a home can be summed up in five words: a huge pile of paperwork. Despite promises of becoming a paperless society, it seems the real estate industry hasn’t yet caught up and both buyers and sellers spend a lot of time with pen in hand.

It’s easy to allow your mind to wander and your eyes to glaze over when your real estate agent sticks yet another form full of legalese in front of you. It’s also dangerous – especially when confronted by one of the three most important real estate documents in the home purchase process.

Let’s take a look at these nasty’s and why you should pay close attention to them.

The Purchase Agreement

Invariably, the first question a homeowner has when handed a purchase agreement is: “How much?” Sure, the offering price is important, but there’s a lot more lurking in the purchase agreement – and some of it is just as important as the money.

A few of the clauses you should scrutinize:

Earnest money deposit: As a seller, you’ll want this amount to be high and as a buyer, you will want to pay as little as possible. The amount of the deposit, however, not only proves that the buyer is serious about completing the transaction but also his or her financial solvency.

As Trev E. Petersen of the Knudsen Law Firm in Lincoln, Neb. says, as a seller, would you “even consider selling to a person who does not have $1,000 to put down on the house?” On the flip side, as a buyer “If you cannot afford a $1,000 earnest money deposit, should you even be considering the purchase?”

Financing contingency: The financing contingency allows the buyer to exit the transaction with no penalty if he or she can’t obtain financing at the stated rate and terms. The contingency, like all of them, is time-sensitive, meaning that the buyer has a limited amount of time to secure a promise from a lender.

The promise is typically based on underwriting, so it is different from the pre-approval process the buyer may have gone through prior to submitting the offer.

Sellers want to scrutinize the time element in this part of the contract. Since you’ll be taking the home off the market during this period, ensure that it isn’t protracted.

Dates: Every contingency in the purchase agreement has a corresponding time limit. There is also a stated date for closing and for possession of the home. Both parties should pay close attention to all of these time limits bearing in mind that “time is of the essence” in a real estate transaction.

Seller’s Property Disclosure

Arguably one of the most commonly litigated real estate processes is the seller’s property disclosure. Rules vary by state and even by region, but generally, a seller has a duty to fully disclose “the condition and information concerning the property known by the Seller which materially affects the value of the property.”

For the buyer, this form is a road map to future repairs. For the seller, if done honestly and thoroughly, it’s a “CYR,” (cover your rear-end).

Buyers also have a duty during the process and it’s known as “due diligence.” Part of this diligence involves becoming as informed as possible about the investment you are about to purchase.

This means you simply must read the seller’s disclosure forms. If you don’t, and a pre-existing condition later rears its ugly and costly head, you have no legal recourse after the sale closes.

Remember, that fresh coat of paint may just be a seller’s way of increasing the home’s curb appeal – or the paint could be acting as a bandage to cover water damage. Check the disclosures carefully.

Homeowners Association Documents

Purchasing a home that is governed by a homeowner’s association brings a whole new pile of paperwork to the process. The governing documents, known as the Covenants, Conditions and Restrictions, or CCRs for short, are extremely important reading material.

These documents will tell you if you can paint your house and, if so, what color. They contain pet restrictions, landscaping restrictions, parking rules and even whether or not you can fly a flag on your property. In essence, although you own your home, the CC&Rs dictate how you can use it.

Other documents in the package that bear scrutiny are the HOA meeting minutes, the budget, insurance information and the financial statements.

These documents don’t exactly make for light, enjoyable reading, but it is vital that you read them thoroughly. Keep in mind that if the HOA isn’t run properly, they may not have enough money in the reserve fund to pay for large repairs or maintenance projects.

In these cases, they will levy an assessment on all homeowners. This assessment is mandatory and failure to pay may result in fines, property liens and even foreclosure.

Consult with an attorney if there is anything in the paperwork you don’t understand.

While every piece of paper put in front of you for your signature is important in a real estate transaction, these three deserve special scrutiny. A home is a lot more than four walls and a roof, it’s an investment that requires due diligence on your part before agreeing to the purchase.

Have you considered a newly-built home? Maybe you should

Homebuilders are paying attention. “Homebuilders are downsizing the American Dream to lure in entry-level buyers frustrated by the resale housing market,” according to Dani Romero at Yahoo Finance.

They’ve already increased housing starts, which reflects their aim to meet the wants and needs of homebuyers who are frustrated by the paltry number of existing homes for sale.

This is huge news for you if you’re among that group. Would you ever imagine that you could buy a brand-new home? No greasy smells from someone else’s cooking, no nasty carpet. Everything, down to the last detail, is brand new.

But wait … there’s more

Have you ever met a homeowner who threw in a pricey country club membership as an enticement to purchase his home? We haven’t either, yet we have met home builders who do just that.

It’s called an incentive and in slow-moving real estate markets, it takes more than offering a choice of countertops and sexy landscaping to sell a home. In some luxury home communities, in fact, huge incentives are the norm.

Incentives from builders run the gamut from appliances to gift cards to mortgage rate buydowns. The latter should be particularly attractive to first-time homebuyers.

If you aren’t familiar with rate buydowns, learn more at CNBC.com.

Incentives aren’t the only reason, however, that many Americans are touring new home communities.

Shop smart and you’ll save money in the long run

Most new homes are energy efficient. If you go a step further and buy a house that bears the ENERGY STAR label, you’ll use 20 to 30 percent less energy every year than you would had you purchased an existing home without ENERGY STAR labeling.

Considering that the average American spends $2,368 on utility bills every year (NerdWallet.com), this reflects substantial savings. What would you do with an extra $473 to $710 a year?

Add that to any incentives you’re offered and you may save a significant chunk of money, not only on the purchase, but down the road with less expensive power bills.

While all of this is good news for homebuyers there are aspects of the new-home purchase that should be considered.

Don’t shop without representation

The builder is represented by a real estate agent. As such, he or she owes a fiduciary duty to the builder, not the buyer.

To protect your interests, use a real estate agent while shopping for and purchasing a newly constructed home. It will cost you nothing, as the builder pays all real estate brokerage fees.

Try to ignore the bling

Model homes are alluring – it’s easy to fall head over heels in love with them. The builder knows this and loads the models with her top-of-the-line options and upgrades.

So, while you dream of having a replica of the model home, the builder dreams of giving it to you – at tens of thousands of dollars over the original price of the home.

New home specialists suggest that you choose options and upgrades that appeal to you and will make living in the home more pleasant, rather than trying to copy the model home’s features.

Ask the builder’s representative if you will be held financially responsible for installed upgrades should you need to cancel the sale.

Finally, if you absolutely must have an expensive upgrade, find out how much it would cost to have an outside contractor purchase and install it after the close of escrow. You may be surprised how much money you can save by going this route.

Inspect to protect

“Buy a new one [home], and you’re essentially the guinea pig testing how well the HVAC system works and whether the basement floods during a storm,” cautions Lisa Kaplan Gordon at Realtor.com.

There are several other reasons you should have the new home professionally inspected by an independent third party prior to closing escrow.

Experts with the California Real Estate Inspection Association take the inspection process one step further, suggesting that the home should be inspected during construction. This helps “… ensure that the work completed is in compliance with plans, specifications, and the construction schedule.”

Finally, real estate legal experts suggest that you purchase a new home warranty that takes up any slack in the builder’s warranty.

So, what are you waiting for? Grab your real estate agent (that would be us, by the way!) and head out to tour the new homes under construction. You may be surprised by what you find.


Selling your home? What to look for in a listing agent

If you’re thinking that finding the perfect real estate to help you sell your home is akin to finding a white cat in a snowstorm, you’re not alone. In fact, ask Google “how to find a listing agent” and you’ll get 151,000 answers.

The task isn’t quite as challenging as it seems when you understand that the listing agent’s primary job is to market your home. So, yes, you want to find an agent you feel comfortable with and one with experience listing homes. Beyond that, there are three important qualities to look for as you interview agents (and please interview more than one) for the job of selling your home.


One thing I hear most often from my clients is that their last agent was unresponsive. I understand that selling your home is stressful and that you’ll have questions along the way. It’s a pity that not all agents feel the same, so ensure that the one you choose will respond to your calls in a timely manner and keep you updated on the progress of the sale.

Experience and Expertise

Look for a listing agent with a proven track record in the local market. An experienced agent is more likely to have a deep understanding of current market trends, pricing strategies, and effective marketing techniques. A seasoned professional will also have the negotiation skills necessary to maximize your profit.

Scrutinize the Agent’s Suggested List Price

Yes, determining an accurate market value for a home and suggesting a strategic listing price is very much a part of an agent’s marketing plan. Homes priced right sell faster and the quicker your home sells, the more money you’ll get for it.

Beware of the agent who suggests a price considerably higher than others you interview. This is an old, dishonest trick known as “buying the listing.” Thankfully, not many agents attempt this but those who do will price your home high at the outset and then continually ask you to drop the price.


Homeowners hire a real estate agent to not only list their homes but market them as well. The listing aspect is merely sticking a sign in the yard and information in the Multiple Listing Service database.

Marketing it is how he or she will get the word out about your home to other agents and unrepresented homebuyers.

Ask the agent to explain his or her approach to marketing homes and exactly how your home will be marketed. And, since most homebuyers start their search online, clear, compelling photographs act as bait to get them off the couch and into your home.

Additional marketing tools that attract homebuyers include floor plans and 3D virtual tours.

In today’s digital age, an agent who leverages technology and online platforms effectively can significantly increase your home’s visibility to potential buyers.

Personality Fit

Selling a home can be an emotional process, and it’s important to find an agent whose personality aligns with yours. A compatible working relationship can help reduce stress and facilitate effective collaboration throughout the selling process.

Hiring the right listing agent is critical to the successful sale of your home. Take your time and don’t rush the process.

3 FAQs from home sellers and the answers you need

You have questions and we have the answers. If you’re considering selling your home, read on.

Is one season better than another to sell a home?

I know – it seems like summer only just started and here we are on the cusp of autumn (it starts September 23). And, while we’re all trying to wring out every last drop of this glorious summer, I am starting to get what I call the “seasonal selling” questions from homeowners.

Long ago, “Spring is the best time to sell a home” became the media’s mantra. And, to be fair, they’re partially correct. The media are also fond of telling us that winter is a terrible time to sell. There, they are wrong.

Home sales in November do tend to fall around 8 percent, nationwide. By January, the number of homes sold tumbles further, to 27 percent. But what the media gets wrong is the fact that so many homeowners choose not to sell their homes in the winter. With fewer homes on the market, naturally, fewer homes will sell.

For my friends who love statistics, the official tally is that 40 percent of any year’s home sales will occur in May, June, July and August, according to research from the National Association of REALTORS.

These same numbers tell us, however, that homes put up for sale in the winter actually sell one week faster, bring in more money and there is a 9 percent better chance that the home will sell than at any other time of year.

And, lest you think this isn’t true for regions with frigid winters, think again. The numbers held, whether the home was located in Fairbanks, Alaska or in Hilo, Hawai’i.

According to the NAR, fall is the second-best home-selling season, and for good reason:

  • The weather is still conducive for house hunting
  • Folks who want to buy a home and are thinking of tax breaks will be incentivized to move now
  • Many want to be in their new home before the winter holidays

If you think you may be putting your home on the market this fall or winter, let’s get some exterior photos of it now, while everything is still green and the sun is shining. Think how much your listing will stand out in the MLS, compared to those with dormant trees and lawns.

2. How will you determine what our price will be?

If there is one aspect of selling a home that confuses home sellers more than anything else it’s the evaluation process. It doesn’t help that there’s so much misinformation online, so I get the befuddlement.

In a nutshell, your home is worth what a buyer is willing to pay for it – known as “market value.” And, no, we don’t read minds to find out how much buyers are willing to pay. That amount is reflected in the prices they’ve paid (in the recent past) for homes similar to yours.

So, we’ll study recent sales in close proximity to your home, and compare your home to each of these to come up with a list of what we call “comparables.”

We’ll then analyze these homes – features, size, age and more – to determine if your home’s market value is more or less until we arrive at a figure that we believe represents the market value of your home.

Next, we’ll need to figure out a list price for your home. While the homeowner has the last word with regards to the asking price, we will offer our expert opinion. By the way, we offer a free evaluation of your home’s current market value. No strings attached. . .no obligation.

3. How long will it take to sell my home?

While this question is common, because there are many variables to consider, it’s not one that has an easy answer.

The first of these variables is the current state of the local housing market. In a sellers’ market (when there are many buyers but few homes on the market), the home may sell quickly. That’s the market we’re in right now.

In a buyers’ market, where there is a large inventory of homes for sale and few buyers competing for them, the home may take longer to sell.

Your list price will also impact how long your home sits on the market. Price it too high and you’ll have few people view it, thus lengthening the time it will take to sell. There is a very good chance that you will end up taking less for the home than you’d hoped.

The agent you choose can make or break the sale of your home. A novice, or an agent who lacks a marketing budget, won’t be able to market your home in ways that will make buyers snatch it up. With a marketing-savvy agent, your home will spend less time on the market.

Finally, the offer to purchase will contain timelines that the buyer must meet for tasks such as loan approval, home inspections and others. These timelines, or contingencies as they are known, are negotiable, however, so you will have a say in how long the buyer has to complete them.

There are other variables to consider as well and we’re happy to discuss these with you. Feel free to reach out to us.

The Real Estate Commission: A detailed explanation

Like any other service, when you enlist the services of a real estate broker or agent, there will be a fee. In the real estate industry, this fee is known as the “commission.” Some real estate consumers don’t believe that professionals are worth their fee so they attempt to sell the home themselves.

They typically end up losing more money on the sale than they would have paid for professional representation.

“FSBOs typically sell for less than the selling price of other homes; FSBO homes sold at a median of $225,000 last year [2022], significantly lower than the median of agent-assisted homes at $345,000.” (National Association of REALTORS® “Profile of Homebuyers and Sellers.”)

Paying for expert services, be it a plumber, an attorney or, yes, a real estate agent, saves you from losing money and gives you the security that the job will get done.

So, let’s dive into the whole real estate commission topic.

How much will it cost me to hire a real estate agent?

The answer to this question is, it depends.

First, it depends on whether you are the buyer or the seller. Buyers do pay closing costs just as sellers do, but the real estate commission is typically charged to the seller.

How much? It depends on where the seller lives. Brokers in different regions charge different fees, but typically you can expect to pay between 5% and 6% of the sale price of the home.

Here’s an example: Joe sells his home for $300,000. Let’s assume that the real estate fee (which the commission is generally called) is 5% of that price, which works out to be $15,000.

Yikes! Does my real estate agent make THAT much money from each sale?

Wouldn’t that be nice? But, no, there are others that need to be paid. The broker for the buyer’s agent gets half of the commission and that of the seller gets the other half.

Then, it is divvied up to the agents. How much the agent will get depends on his or her arrangement with the broker.

For instance, newer agents tend to make less of a percentage than seasoned agents, but each agent negotiates his or her cut of the broker’s fee, which generally ranges from 50% to 95%. According to most studies, the average commission split is 50/50.

If you still think this represents a big gob of money, consider this:

The “… median income for real estate agents and brokers was $48,770 annually in 2021, according to the U.S. Bureau of Labor Statistics,”

according to Kellye Guinan and Taylor Freitas, Bankrate.com.

What does the seller get for this money?

The typical listing agent faces a hefty outlay of money for each listing he or she takes. Here are a few of the ways the commission money is spent:

  • Lockboxes
  • Online marketing
  • MLS fees
  • Direct mail marketing
  • Photography
  • Signage
  • Fliers
  • Broker’s open expenses
  • Errors and Omissions Insurance
  • Brokerage fees
  • Association fees
  • Lead generation website to bring in buyers

That’s the shortlist. Depending on how challenging the market is or the attractiveness and condition of the home, the agent may spend thousands of dollars to help you sell your home.

What you also get for that money is a buyer for your home. Priceless, right?

Questions? We’re happy to answer them. Feel free to reach out!

Buying a house with bad credit: Is it possible?

The one thing that many of our first-time homebuying clients worry about is whether or not they qualify for a home loan. The reason for this is the dreaded credit score; those three numbers can make or break the dream.

The worry is overblown for the most part. Yes, lenders rely heavily on the potential buyer’s credit score. After all, it is typically an indication of whether or not the borrower uses credit responsibly, if he or she pays bills on time and how much of a risk the borrower presents to the lender.

There are loans available to folks with less-than-perfect credit. The downside is that you may pay more in mortgage interest, fees and may need a higher down payment.

What’s a good and what’s a bad credit score?

Typically, credit scores can range from 300 to 850. “Although ranges vary depending on the credit scoring model, generally credit scores from:

  • 580 to 669 are considered fair
  • 670 to 739 are considered good
  • 740 to 799 are considered very good
  • 800 and up are considered excellent,”

According to the experts at equifax.com. Let’s put the above numbers into perspective. On a loan for $350,000, borrowers with credit scores between 760 and 850 will receive (as of July 2023) a mortgage interest rate that is 1.589 percent less than borrowers with a score between 620 and 639.

So, yes, provided all other stipulations are met (stable employment, income, etc.), you can buy a home if you have bad credit. You will, however, pay more for it than someone with better credit.

Your credit score may not be considered “bad”

Americans with less-than-stellar credit scores, those that fall below 670, are considered subprime borrowers. Learn more about getting a subprime mortgage at Experian.com.

If your score is lower than 579, it is considered “bad.” This is why it’s important to check your score before embarking on the journey to buy a home. It may not be as bad as you think, or it could be worse.

Thankfully, lenders also look at other aspects of your financial situation. These include:

  • Your current debt and any delinquencies
  • The amount of your down payment
  • Your income

There are loans for that

The best route for those with poor credit is government-backed mortgages. These include mortgages backed by the:

  • U.S. Department of Agriculture (USDA) Rural Development Department
  • Federal Housing Administration (FHA)
  • Veterans Affairs (VA)

USDA loans typically don’t require a down payment. The catch is that the home you will purchase must be located in what the department considers a “rural” area. If you have an idea of where you want to live, especially the address of a property, enter it on the USDA Rural Development’s website to see if it is eligible for the program.

The best part of this program, aside from the zero down payment for those who qualify, is that the credit score requirement is quite low: at least 580. Higher scores, however, qualify for the no down payment bonus.

FHA loans are quite popular among those with poor credit scores. The minimum credit score required is 500, although if yours is at least 580, you may only be required to put down 3.5% of the purchase price. Learn more about down payments at consumerfinance.gov.

If you or your spouse have served in the U.S. military, or are a widow or widower of someone who did, check out the mortgages offered by the Department of Veterans Affairs. Available to both veterans and active-duty members of the military, the minimum acceptable credit score is 580.

There is no down payment requirement for those who qualify. Learn more online at benefits.va.gov.

Additional tips

Before you begin the mortgage application process, take a deep dive into your credit reports. Look specifically for errors. Why?

“More Than a Third of Volunteers in a Consumer Reports Study Found Errors in Their Credit Reports,” according to Lisa L. Gill at consumerreports.org. Fixing these errors is one of the easiest and fastest ways to raise your credit score.

“You should dispute with each credit bureau that has the mistake,” suggests the experts at the Federal Trade Commission.   Follow the link to read a walk-through of the dispute process.

If all options fail, take the time to save cash. It’s king, remember? And lenders are more likely to approve your loan if you have cash to pay the difference between the price of the home and your loan approval amount.

Poor credit shouldn’t put an end to your homebuying dreams. There are options out there and we’re happy to discuss them in further detail with you.

The information above is not to be considered as financial advice, but is for informational purposes only. We are not financial or mortgage specialists.