Sellers: Demand These 5 Things of Your Agent

If you are thinking of selling your home and taking advantage of the current "sellers market" status, having an agent on your side is essential.  However, make sure you are getting the most out of your experience by making these 5 demands on your agent, courtesy of the KCM blog (Thanks, KCMBlog!).  These 5 simple, but important demands will help ensure that your agent is truly able to give your sale the time and attention it deserves.

Here's what I would say if I were in your shoes.


1. Be honest with us about the price.

It is a common practice for agents to accept a listing at any price, and then negotiate the price to whatever the "correct" budget should be somewhere down the line. This is a ploy by an agent that either is telling you what you want to hear to get the listing, or is not a capable market analyst.  It is also a blatant violation of the Realtor Code of Ethics.

In truth, your agent should be educating you in the fine points of pricing a home, the current market data that will drive your market price, and then asking you how you want to compete. In short, the list price is your decision - you just want to know that your agent believes in it and isn't appeasing you.

This price-point security is especially important because agents will not be selling your home once, but twice; once to the buyer, and then again to the bank's appraiser.  As many sellers have experienced, the second sell - to the bank - can be much more difficult than the first.  Since it can be such a trial to get a bank to agree on a contract price, its important to really have your agent on board with the price point so that they can go to bat for you.  If the agent you're working with does not discuss the price in depth, this should be a major red flag.

2. Understand the time-frame that my family and I have to work with.

Moving to a new home usually requires a detailed scheduling negotiation - when can I take off work, when will the kids need to start school, etc - which is an important component to your process, as it can be a great emotional strain.  Make sure your agent understands your concerns with the time frame.  While they may not be able to set an exact date for your move, make sure that they at least have an appreciation for your concerns and will work with you to the best of their ability.

They didn't ask you about your time-frame?  Another red flag. 

The Top 3 Reasons to Buy Now, Not Later

It's a sellers market with low inventory.  But should buyers stray away?  Just the opposite.

Here are the KCM blog's top 3 reasons to buy a house now, rather than later.

1. Prices are rising, and will continue to rise

According to recent findings from the Home Price Expectation Survey (comprised of over one-hundred respected economists and market analysts), home values are expected to appreciate anywhere between 12.3%-32.8% over the next five years.  This figure, coupled with recent speculations that low housing inventory does not expect to improve any time soon, suggests to potential buyers that waiting will most likely not improve your odds.

2. Mortgage interest rates are increasing - fast

Mortgage interest rates were at an all-time low earlier this year, but they are now on the rise without any sign of slowing.  The National Association of Realtors, the Mortgage Bankers Association, Freddie Mac and Fannie Mae, have all projected that 30-year-fixed mortgage rates to rise to somewhere between 4.8 and 5.1% by next year.  If you wait a year, your mortgage will cost more than it would now, which could definitely inflict a heavy impact on your budget.

WIll the Housing Shortage Continue for Long?

Since early spring, home prices have been rising at a double-digit rate.  Why?  According to Lawrence Yun, chief economist for the NAR, the reason lies in that basic economic principle: "increasing demand and tight supply."

With the economy improving, it is not surprising that there is a rise in housing demand, especially following a five-year period where new households were being formed at less than half of the normal rate (college graduates moving back home with mom and dad, young professionals getting roommates, etc.)  Since the six million new job additions in 2012-13, this number has seen a rapid rebound.  Yun anticipates this continuing for several years, ultimately at least returning to the historic average of 1 to 1.1 additions of new households per year, if not surpassing this figure.

The catch is, naturally, supply.  Yun provides a few possible scenarios where inventory increase could be suggested.  The first coincides with underwater homeowners being able to sell due to rising prices, thus adding to supply.  While this scenario may provide a new property on the market, these homeowners typically have an intent to move and buy another home, not to sell to become a renter.  Selling a home, and buying another, results in a zero sum inventory gain.