In This Issue

Understanding the Comparative Market Analysis Negotiating 101 School's In

We are pleased to present you with the latest issue of Life@Home.  Delivered to home buyers, sellers and owners on a monthly basis, this electronic newsletter is designed to give you the real estate information that is important to you.  In each issue, you will find practical tips and articles related to buying, selling or owning a home, as well as the latest news on real estate trends.  We hope that you enjoy this issue of Life@Home.  If we can be of any assistance, please do not hesitate to contact us.

Understanding the Comparative Market Analysis

As the old saying goes "Knowledge is Power". This adage can certainly be applied to the real esstate transaction. The more you know, from the ins and outs of the process to the market conditions, the better your chance of selling and getting the most from your investment.

The Competitive Market Analysis or CMA is a report that will help you learn more about your marketplace. Many real estate professionals offer this free service or as part of their service package. A CMA offers you a snapshot of the real estate conditions in your area and can be a very useful tool when setting your own asking price.

Here are some of the elements contained in most reports:

1. Homes for sale - This is an inventory of the current active listings in the Multiple Listing Service (MLS). It will give you an idea of how many other homes will be competing for buyer attention. Consider the asking prices for homes similar to yours, but remember the asking price is just that. It does not reflect what buyers are willing to pay.

2. Pending sales - These are active listings that are now under contract. Additional data on the sale will likely not be available until after the closing.

3. Comparable sales - This is perhaps the most revealing and interesting component. It details all the sold listings in the last six months and their sale prices. Look carefully at the numbers. Here you can discover how much buyer's are willing to pay. This data can help you and your agent craft a realistic list price.

The final piece of the CMA puzzle is to make sure you look specifically at homes that are similar to yours. To make the most of this data, search for a home that is comparable to yours in location, size, age, amenities etc. Use the expertise of your agent to analyze the numbers and his or her market knowledge to adjust the numbers up or down accordingly.

Negotiating 101

Negotiating a real estate sale can be stressful. If you've fallen in love with a property and have already imagined it as your next home, the process can be an emotional rollercoaster. Your real estate agent, who likely warned you not to become too attached before the deal is settled, will be your guide through the back-and-forth. Among other things, your agent will consider three factors:

1. Market Conditions - Whether it is a buyer's market (high inventory and falling sales prices) or a seller's market (less inventory, more buyer demand and higher prices) will greatly influence how much you should offer for the property.

School's In If you have a child starting college this fall, take time to set some ground rules. This venture has a better chance of success if you start on the same page. For instance, share what you expect your child to do, like attend all clases or email once a week. A good understanding can be athe basis for a great year.

2. Budget - Of course your buying power plays a tremendous part. It ultimately determines where negotiations begin and how high your offer can climb.

3. Motivation - Your need to move combined with the seller's motivation to sell is an intangible factor that will impact negotiations. For instance, if you know the sellers are divorcing and need to sell quickly as part of a settlement that could come into play.

In addition to these factors, it is a good idea to discuss the negotiating tactics your sales associate plans to use. maybe the best approach is to start low and work your way up to an agreeable price. Or if you know market conditions are in your favor, starting with a firm price and a "best offer" approach could be the better move. Discuss the different options with your agent.