Mike Batty presents a Special Report.

"Why are you selling?"

To sell, or not to sell, that is the question…

PAIN vs. PLEASURE

Basic human psychology tells us that we all respond to two motivations. We either move away from pain, or towards pleasure. The problem for most of us, when it comes to selling our homes, is that there is a confusing mix of pain and pleasure that changes every minute throughout the process.

STRESS … Can you handle it? The confusing mix of pain and pleasure produces stress, and that is why the act of selling your home and moving is one of the most stressful events in your life.

• The stress is higher the more people are affected by the decision.
• A single person will be focused on the new location and the stress will be least.
• For a couple one spouse may have some resistance to the move, for them it is a leap of faith that the benefits of the new location will compensate them for the disruption of finding new friends, establishing a new home, possibly finding themselves acceptable employment in a strange new town.
• For a family with children the dynamics become even more of a challenge, the kids are leaving their friends, changing schools, and have little view of what good will come of the whole experience, they will make their pain known to everyone.
• In a situation where the move is involuntary, a divorce or financial hardship the stress will be the worst because everyone involved feels a loss.   

Will your life be better after the move? If yes, write that down so you remember that for the next few months.

Make a Plan.

     Stress does not usually produce the best decisions. So before the chaos starts sit down and make a plan. In an ideal world you will sell your house, find the house to move to and then close them both on the same day. Reality is different in today’s slow markets.

·         Sell your house as soon as you can, once you have a P&S then begin looking for your new one.

·         Get temporary living in a month to month rented apartment or house. It will take some of the stress off and give you time to be patient and identify the home you want. You can even use the rental to give yourself a week or two to paint and do any changes to the new house before it is full of all of your belongings and your family.

For most of us it is about THE MONEY.  There are only two choices either you keep your current house, and maybe rent it out, or you sell it and move on.

If you are one of the fortunate few that don’t need the money from the equity in your current home to allow you to buy the next one, then you may want to keep the current house as an investment. But first consider;

• In most cases keeping and renting a single family home gives a low rate of return if any, with a high management and maintenance requirement. 
• Rental rates in most areas of the country will not cover the mortgage, taxes and insurance on a single family house so it is not a good financial decision. Consult with a CPA to see if it makes financial sense.
• The real reason for holding is more likely as a psychological safety net in case you want to return to this town, if the new job doesn’t work out. A valid reason, but it can be an expensive and time consuming safety net.

For the rest of us we have to sell in order to buy.

• The decision to sell is forced as soon as the decision to move is made. So don’t second guess this part.
• The next issue becomes the need to sell at a high price to allow purchasing a new and better home, but having to sell in a reasonable timeframe because you need to get settled in the new place as soon as possible to bring the stress level back down.
• Balancing money vs. time is what makes setting the right sale price so stressful. Set the price too high and it will take too long to sell if it sells at all, and the stress rises with each passing day. Set it too low and you will forever second guess the decision and the money ‘left on the table.’
• So set a reasonably aggressive price based on recent sales data so that you can expect to sell quickly, and then be prepared to accept an offer that is reasonably close. By knowing the market, you know you got a fair price and the stress goes away.
• It is also fairly common that the first offer on a house is the best offer that will ever be made. So unless it is obviously a lowball offer, take the money and don’t look back.

A few words about ‘Market timing’  

Today the market is not good, but will a little more time really change the financial picture?  

• Forecasts say that the 2005 peak prices will not return to until 2015….  Do you really want to wait that long?
• For anyone who has done any investing in the stock market, it is accepted as a basic truth that no one makes money by trying to “time” the stock market.
• The real estate market is similar to the stock market in that there is a general rising trend, with local markets going up and down like industry groups, and individual houses rising and falling like stocks. But with the exception of a few large investors the real estate cycles are too long and geographically spread out to be useful.
• If you are moving city to city, the relative cycles are difficult, if not impossible, to predict. Even if you are looking to move to a nicer neighborhood in your own town, then the home you are looking to buy will lose value slower, and gain value quicker than the one you are trying to sell. If you wait until next year the one you want to buy will be even more expensive relative to your home than it is now.

Your home is not a true investment.

• No one makes money when they are emotionally attached to an investment.
• You bought it when you needed it and because you liked it. It had a workshop, a great kitchen, it was close to your work, etc...
• You are emotionally attached to it. You raised your kids here, you planted that tree, those rose bushes …
• You live in it as long as it suits your needs, and when you decide to move you sell it in order to purchase our next home.

Since it isn’t really an investment, you really, really should not attempt to approach selling it with an eye to “the market.” When going through the process of deciding that you need to sell it is best to ignore whether the market is going up, or down, or sideways.

• Once the decision is made, then market conditions will affect your marketing strategy, but should not cause you to revisit the basic decision.

So … WHY are you moving again?

#1  New Job, new place.

The leading reason that people sell their homes is to relocate to a new town, typically in response to a change of job, moving towards the perceived pleasure of a better job in a new place. A new job that is more than 30 miles further from home will typically trigger a move. At the point that you accepted a new job you will have realized that you will have to change where you live and therefore your house.

#2  Life isn’t the same any more!!

The next most common reason to sell is that personal circumstances have changed negatively. A death, a divorce, disability, job loss or similar life event is forcing the sale of the home.

• The stress of one major life event is already in place and selling the home just adds more stress to an already difficult situation.
• There is time pressure to get it finished.
• So set a reasonably aggressive price based on recent sales data so that you can expect to sell quickly, and the stress goes away.
• Then you can move forward in the rest of your life

#3 Moving UP

For the next category where people are moving a short distance to a nicer, newer, bigger home, or into a better neighborhood, the stress level is substantially lower.

• You are not facing a total disruption to all of your social network
• There is an easily perceived pleasure for all involved in moving to the new home. Whether it is a bigger yard, nicer kitchen bedroom of your own, better schools or whatever everyone is usually on-board with the change.
• So set a reasonably aggressive price based on recent sales data so that you can expect to sell quickly, and then be prepared to accept an offer that is reasonably close.
• In most areas homes are on the market for 90+ days so you should have plenty to choose from when you look to buy. With your house sold, you are in a strong bargaining position to get a deal on the new house.
• Building a new home is a similar situation, although you should plan 9 months from papers to occupancy on a new home, so temporary living is almost essential.

#4 Moving on

An increasing segment of the population is selling to downsize. The baby boom generation has raised their children, moved up to bigger homes and now a couple in their 60’s no longer needs or wants the maintenance workload and expense involved with a 3,000 square foot, 4 bedroom, 2.5 bath house. They may be looking for a condo in town or a smaller home someplace they can retire to.

• The decision to sell is made to avoid the pain of the maintenance and move to the pleasure of a smaller more manageable home.
• The objective is to make enough money to purchase the smaller home and hopefully have some extra to augment the retirement funds.  
• The stress of moving is amplified by the pain of leaving a home probably with many memories, and having to clean out the collected memorabilia of those years.
• Once the decision is made, it is best for all to execute on it quickly, so get some help, get the house cleaned out as quickly as is possible.
• So set a reasonably aggressive price based on recent sales data so that you can expect to sell quickly, and then be prepared to accept an offer that is reasonably close..

OK, now like Nike said  " Just Do It!"

A final comment on selling your home. To some great extent it should be approached as counseled by Yoda in Star Wars  “ There is no try, only do”  By this I mean that you must enter the process knowing that there will be days that the pain of the stress, chaos and disruption of selling and moving seems too much. If you say that you are going to ‘try’ to sell the house then you will quit when the first of these days happens. It will have been a waste of your time and energy as well as the time of those who tried to help you.

• There are people who ‘try’ to sell their house for 2 months every summer. After the second, or third, ‘try’ no one takes them seriously. Don’t be one of these people…
• Keep in mind that whatever triggered the original decision to move will still be there the next day, and next week, and forever. So the new job, the new house, or whatever will still beckon.
• If you stop half way through, then somewhere in the future you will have to start again at the beginning.

If you keep going and finish the sale, then you will be free to pursue your dreams and your life will be better for the success. So once you’ve decided to go then stick with it until you have achieved your goal.

For a free home analysis, and to talk with your new agent today contact:

                 Mike Batty

      mike@GreatLexingtonHomes.com    or        <click here>