Mohammed Tiouat's Blog

Few more difficult financial challenges exist than selling a house at a time when too many homes are for sale already, including many foreclosed properties. Depending on your situation and where you live, you may be braced for a long wait or a big disappointment in the kinds of offers you receive. But there are steps you can take to shorten the process and ease the stress.

Show your sales savvy. The secret to any successful sale is good marketing and the right teamwork. Put your best tactics to work.

• Pick a top agent. This is no time to quibble over a couple of percentage points on commissions. Hire the best, most aggressive, most determined selling agent you can find.
• Offer a bonus. Give the agent some extra incentive to move your place: Pay extra if the house is sold in 30 days or you get your asking price.
• Promote, promote, promote. Make sure your house is on all the real-estate websites, in the newspaper, in your company's newsletter, on the bulletin board at Starbucks and maybe even on Craigslist. You can't get too crazy.

Make your place shine. In a buyer's market, the houses that stand out have something special to offer. Be sure yours is memorable.

• Price it cheaply. Forget what you think the house should be worth or what it was worth three years ago. Avoid having the house hang around on the market for months while you gradually lower the price. Painful though it may be, start with as low a price as low as you can reasonably bear.
• Cut the clutter. No one wants to see all your collections and other stuff. They want to imagine their own stuff in your place. Leave enough furniture to make the place look livable and put the rest in storage.
• Spruce it up. A paint job, a good cleaning and maybe some cosmetic improvements, like new countertops, can make a big difference. Imagine that potential buyers are taking your house out on a date. You want it to make a good impression.

Be flexible. Some markets are so distressed that selling is a significant challenge. You'll need to go in with an open mind and a good plan B--and C.

• Take the offer. If a qualified buyer comes in with a reasonable offer, be prepared to accept it, even if it's below what you thought your low price was.
• Became a banker. Credit is so tight that some potential buyers may not be able to get loans from traditional lenders or may not have a big enough down payment to satisfy mortgage insurers. If you own your home outright, you can carry the mortgage yourself. There is risk--the buyer could default--but you could also command a higher price. Just be sure to hire a real-estate lawyer to do the paperwork.
• Consider renting. If homes just aren't selling, then , becoming a landlord at least temporarily, may well worthwhile. You'll have monthly income and some nice tax benefits.

What not to do. A down market is fraught with frustrations. You don't want to make it worse by being stubborn or ignoring good advice.

• Don't sell if you don't need to. Are you sure you have to move? Do you really need a bigger house or a new neighborhood? If the stock market is already forcing you to rethink retirement plans, you should also rethink whether you really want to be downsize or move away from family.
• Don't wait around. Once you conclude you do need to move, don't try to wait out the market. As soon as things look a little better, a rush of new homes for sale will come on the market. If you want your place sold, put it up for sale.
• Don't quibble. Negotiate the price, of course, but don't dig in your heels over a few dollars and send the buyers looking elsewhere. Remember: Your house is worth only as much as someone is willing to pay for it.

Overseas buyers snatching up pricey homes

NAR: International sales volume up 24 percent

By Inman News
Inman News®

Though U.S. home sales to foreign buyers declined slightly in the year through March 2012, a preference for more expensive homes pushed the total sales volume of international sales up by 24 percent, according to an annual report from the National Association of Realtors.

NAR's 2012 Profile of International Home Buying Activity includes results from 1,745 member respondents surveyed in April 2012. The survey covered purchases of U.S. residential real estate by international clients in the 12 months through March 2012. International clients were divided into two groups: foreign buyers with permanent residences outside the U.S., and buyers who are recent immigrants of less than two years or temporary visa holders residing in the U.S. for more than six months.

In the year through March 2012, each group accounted for an equal number of international sales, a total of 206,192, or 4.7 percent of overall home sales in that year. That total is down 2.2 percent from 2011, when international sales made up nearly 4.9 percent of overall sales.

At the same time, however, the median sales price of homes preferred by global buyers rose to $400,000, compared with $315,000 the year before. By contrast, the median sales price for home sales overall -- both international and domestic buyers -- declined 2.6 percent to $212,183 in the 2012 report.

That increase in the median price of foreign purchases resulted in a 24.2 percent rise in total sales dollar volume for international sales, to $82.5 billion, up from $66.4 billion in the year through March 2011. That $66.4 billion figure has been revised downward from the $82 billion originally reported last year as a result of adjusted home sales figures.

In December, NAR "rebenchmarked" its sales statistics going back to 2007, correcting assumptions that had led the trade group to overestimate home sales by 14 percent.

International sales figures for 2010 were also adjusted as a result. Sales volume for international sales in the year through March 2010 was $53.4 billion, NAR told Inman News. That means sales dollar volume in 2011 rose by about as much as in 2012: 24.3 percent.

"Today's advantageous market conditions have drawn more and more foreign buyers to the U.S. in recent years, signaling how desirable and profitable owning property in this country can be," said NAR President Moe Veissi in a statement.

"Low housing prices, a good inventory condition and increased buying power with today's exchange rates help attract international clients."

In the 2012 report, 27 percent of REALTORS® reported working with international clients, about the same as last year. Of those REALTORS®, nearly nine in 10 reported working with five or fewer international clients.

Four states accounted for 51 percent of international purchases in the U.S.: Florida (26 percent), California (11 percent), Arizona and Texas (7 percent each).

The weakening U.S. dollar and declining home values are largely discouraging for Americans homeowners. For international real estate investors, however, such conditions present opportunity. The National Association of Realtors (NAR) recently released the 2011 NAR Profile of International Home Buying Activity.

"NAR estimates that between 650,000 and 790,000 homes were sold to foreign nationals from May 2009 to May 2010," according to the NAR press release on the findings. "Recent foreign buyers purchased properties in every state and the District of Columbia. The most popular states where international buyers purchased homes are Florida, California and Texas. Arizona, New York, Washington and Nevada were also popular."

Nearly half of the properties purchased by foreign buyers were located in the South; 25.4 percent of all property sales to foreign buyers occurred in Florida alone. (For more information on foreign investment in Florida's real estate market, please see our previous article, Europeans Set Sights on Florida.)

"Foreign exchange rates have helped make U.S. homes more affordable for international buyers," according to NAR's press release. "The euro, for example, has strengthened 24 percent versus the U.S. dollar over the past two years. Home prices are also now more affordable in places such as Florida and Arizona, contributing to those states’ popularity among foreign buyers."

The typical foreign buyer bought a single-family home at $297,400, intended for use as a vacation home, where the buyer stayed 2.6 months of the year, according to the findings. 40 percent of foreign buyers made the purchase in cash, compared to just 7 percent of domestic homebuyers who do so. In the previous report, which covered the period between April 2009 and April 2010, 28 percent of foreign buyers made their purchases in cash. This 12 percent increase in foreign buyers who purchased properties in cash can perhaps be attributed to the weakened U.S. dollar and sinking home prices across the country.

Foreigners who invest in U.S. real estate also differ from their domestic counterparts in other ways. They tend to buy more expensive properties than domestic real estate investors, and are more likely to purchase a condo or townhome than domestic real estate investors. Foreign buyers purchase properties that cost an average of 36 percent more than domestic buyers, and 14 percent of properties purchased by foreigners cost $750,000 or more, according to the findings.

Investors from China were the most likely to purchase properties at $1 million and more, with 14 percent of Chinese buyers doing so. The median price paid by real estate investors from China was $450,000, the highest median of any location in the report.

Nearly one quarter of investors from India purchased properties to use as rentals, the highest found in the report.

"People from North America, Europe and Asia accounted for more than 85 percent of recent foreign home buying transactions. The top six countries of origin for foreign home buyers, in rank order, were Canada, the United Kingdom, Mexico, China, India and Germany," according to NAR's press release. "This year, Canada replaced Mexico as the country with the largest share of foreign buyers in the U.S. The percentage of Canadian buyers doubled from last year, from 11 percent to 23.5 percent."

26 percent of Realtors have worked with foreign homebuyers, according to Inman News; that is down slightly from the 32 percent of respondents in NAR's previous report, which covered the period between April 2006 and April 2007. The drop may be attributed in part to decreased confidence in the U.S. real estate market in the wake of its downturn.