Overpricing is not always a good idea

7 Deadly Sins of Overpricing
Most experts would advise that the best way to increase your
odds of a successful sale is to price your home at fair market
value. But, as logical as this advice sounds, for many sellers it is
still tempting to tack a few percentage points onto the price to
"leave room to negotiate". To avoid this temptation, let's take a
look at the seven deadly sins of overpricing:
1. Appraisal Problems
Even if you do find a buyer willing to pay an inflated price, the fact
is over 90% of buyers use some kind of financing to pay for their
home purchase. If your home won't appraise for the purchase
price the sale will likely fail.
2. No Showings
Today's sophisticated home buyers are well educated about the real estate market. If your home is overpriced they
won't bother looking at it, let alone make you an offer.
3. Branding Problems
When a new listing hits the market, every agent quickly checks the property out to see if it's a good fit for their
clients. If your home is branded as "overpriced", reigniting interest may take drastic measures.
4. Selling the Competition
Overpricing helps your competition. How? You make their lower prices seem like bargains. Nothing is worse than
watching your neighbors put up a sold sign.
5. Stagnation
The longer your home sits on the market, the more likely it is to become stigmatized or stale. Have you ever seen a
property that seems to be perpetually for sale? Do you ever wonder - What's wrong with that house?
6. Tougher Negotiations
Buyers who do view your home may negotiate harder because the home has been on the market for a longer
period of time and because it is overpriced compared to the competition.
7. Lost Opportunities
You will lose a percentage of buyers who are outside of your price point. These are buyers who are looking in the
price range that the home will eventually sell for but don't see the home because the price is above their pre-set
budget.
Most buyers look at 10-15 homes before making a buying decision. Because of this, setting a competitive price
relative to the competition is an essential component to a successful marketing strategy.

low interest rates = great opportunities for buyers

We all know that interest rates are low. We have been hearing or reading about it for quite some time, and we may zone out without figuring the true value. The fact is, if you have good credit, you would be surprised at just how low your monthly payment on principal and interest could be.

For comparison, lets look at a $75,000 loan.
Take for instance, an FHA loan, at 4.375%, 20 years = $469.44, 30 year = $374.46.
Or a 10 year ARM, at 3.75%, figured over 20 years = $444.66, 30 year = $347.33
Or the 2.99% 5 year balloon, figured over 20 years = $415.57, 30 year = $315.79.

On a $100,000 loan, these same calculations would yield payments of $625.92 to $421.06.


These types of rates can be found locally from our area lending institutions. There are also some programs that require very little down payment. For more information, please see your local lender or give me a call. Lower monthly payments allow you to pay off debt quicker or purchase a higher value home.

Windshield time without the window

While the realty business can be a lot of hard work and many hours, once in a while you need to travel the back 40, check out the crops and maybe just enjoy the day. I was able to do that Saturday morning. As part of Hawkeye Fun Day, I participated in a 39 mile tractor ride. I rode my 1942 Farmall H as about 70 tractors took part in the ride. The scenery was great as were the crops. I'm pictured waiting my turn to go down the street for the parade.

Open House at 308 Alexander

We are holding an open house at 308 Alexander in Fayette, Thursdday evening from 5:30 to 7 pm. If you're thinking about a new home with lots of space, this is the home for you. Overall, there is 3000 sq ft of living space, an attached 2 car heated garage and a 10 x 20 wood deck. The main floor is 3 bedrooms, 2 baths, kitchen, dining, living room and laundry room. Downstairs is 2 more bedrooms, full bath and a huge family and utility room.

This is an energy star home and you will save greatly on heating and cooling costs. Stop in for a look around.

Acreage south of Maynard

We have an acreage for sale south of Maynard. The acreage includes a 3 bedroom 1 bath home with many updates since 2000, a barn with large haymow, open to the south, and a cattle shed northwest of the barn. There are approx 18.34 acres with about 10 acres being tilled (and tiled). The pasture on the north side of the property runs on both sides of the Volga River. Along the south bank, there are many majestic burr oaks and the area would make for an excellent building site. The NW side of the property has several rows of trees planted.

This property is owned by the Stewart family, dairy farmers from Oelwein. Gene Henderson lived here for many years. I'm sure Gene will be at the "Million dollar dairy sale, being held at the Fayette County fairgrounds this weekend and hosted by Norm Nabholz.

Sale Pending

We have an agreed purchase agreement on the property at 309 E Clark. Meanwhile, the house at 111 Washington St. is for rent or for sale. Call me if interested.

Townhomes in Fayette

Construction has begun on some new townhomes in Fayette. The 8-plex building includes six 3-bedroom units that are 2-story and two 2-bedroom ranch units. All eight units include an unfinished basement and a 2-car attached garage. Construction is expected to be completed by Nov. 1. I have floorplans on the units. Stop by or give me a call to review