Saratoga News

Homes

The Real Deal

'Savvy sellers' hire a realtor

With the traditionally busy spring season just around the corner, homeowners may want to pay attention to a new campaign recently launched by the National Association of Realtors that encourages home sellers to protect what could be their largest investment by enlisting the help of a professional.

"Selling a home is like climbing Mt. Everest," said Thomas M. Stevens, the association's president. "If you don't prepare correctly, you'll never achieve your goal. Getting a signed contract is like reaching the peak, but that's only half the journey. Many things can happen on the way back down the mountain. Savvy sellers know to hire a Realtor to protect their interests and guide them through."

Homeowners who try to sell their homes without professional help must overcome a number of hurdles. Some obstacles include making the appropriate disclosures, preparing the home for sale, pricing the home appropriately for a dynamic market and, most importantly, attracting qualified, motivated buyers.

Finding an interested buyer is only the first step toward a successful sale. The typical home sale today involves more than 20 steps after the initial contract is accepted to complete the transaction.

Knowledge of the market is perhaps one of the greatest benefits of using a Realtor who can explain how national and local trends pertain to the sale of a specific house in a designated neighborhood.

The latest industry news about the spring market indicates sales will remain at historic highs, but other factors are likely to come into play. David Lereah, chief economist for the National Association of Realtors, said mortgage interest rates will have an effect since, although they are trending up, they will remain favorable.

"Economic growth and job creation are providing a favorable backdrop for the housing market, but rising interest rates have an offsetting effect," Lereah said. "Home sales will move up and down somewhat over the remainder of the year but stay at a high plateau, meaning this will be the third strongest year on record." He expects the 30-year fixed-rate mortgage to rise to 6.9 percent by the end of the year.

Growth in the U.S. gross domestic product is forecast at 3.7 percent in 2006, while the unemployment rate should average 4.8 percent.

Existing-home sales are projected to drop 6 percent this year, and new-home sales are likely to fall 10.9 percent from a record last year, with both sectors seeing the third best year following 2005 and 2004. Housing starts are forecast at 2 million in 2006, which is 3.2 percent below the 2.07 million in total starts last year.

While home prices are expected to cool, the experts are now saying they won't cool off as much as in earlier projections.

"Although housing inventories have been improving, the balance is still a bit more favorable for sellers, and annual appreciation remains in double-digit territory," Stevens said. "Even so, the market is in a process of normalization--appreciation will return to normal single-digit patterns, providing solid investment returns into the future."

Inflation as measured by the Consumer Price Index is seen at 3.4 percent in 2006. Inflation-adjusted disposable personal income should grow 3.8 percent this year.

To find someone who can translate the latest predictions and trends, go to the Silicon Valley Association of Realtors website at www.silvar.org for a list of knowledgeable and professional Realtors.

Information provided in this column is presented by the Realtor members of the Silicon Valley Association of Realtors at www.silvar.org. Send questions on any topic to pcardus@silvar.org.