Armchair Builder

Take Advantage of The Real Estate Market, Part II

Photo by ACM Design Architects

Photos by ACM Design

In discussions about taking advantage of today’s real estate market, a common concern is the difficulty in selling our existing home.  The thought is, How can I take advantage of the market if I can’t sell my home? We will discuss several ways to deal with this issue below.

Make Your Home The Best:  Don’t try to compete on price with foreclosures or bank owned properties.  We mentioned in the last post that people have a hard time visualizing a home that needs a lot of work.  Even if they could visualize the space updated with their particular tastes, they don’t want to put the effort and time into making it happen.  This is where your home shines against the distressed properties.    People are willing to spend more to avoid the extra work and costs after closing.  So in order to maximize this key advantage you have, make sure you make your home look the best it possibly can.  Clean, update, and replace anything in your home that needs it.  You may want to finish your basement as an owner–builder for $8 to $10 per square foot or update that bathroom that is still original.  With the savings you will get from managing your projects yourself, you will add more value than your actual cost.  I know it’s hard to put money into a home that you are selling, but this is how you beat the competition in today’s market.  Besides, you will make up the money, and then some, when you buy your next place.

Price at Current Market: Get over what your home was worth and focus on the current market in your area today.  You don’t need to price your home at the level of the distressed property, but you do have to be realistic.  Make sure you know your competition in your area for your type of property and be competitive on price.  Otherwise, you are wasting your time.  This is not the market to wait for the one buyer that is willing to pay a higher amount.  Even if you did find this elusive buyer, the bank won’t appraise the property higher than the going market price. Fire Pit

Buy Your Dream Lot: If you just can’t bring yourself to lowering the price on your existing home to the current market, how about purchasing the land for your future dream home?  There are some great lot deals out there.  They may not have fallen as much in price as the homes have, but property to build on hasn’t been sparred in this down real estate market.  Be sure you do some homework for the property making sure you will be allowed to build the home you want.  Most homeowner’s associations have restrictions that apply including minimum square footage and types of plans to be built.   You will also want to thoroughly check out the re-occurring costs for the lot to make sure they fit your budget.  These would include real estate taxes, homeowner’s association fees, utility availability fees, lot maintenance fees (i.e. brush clearing and tree trimming), insurance,…etc.  By purchasing your lot now, you will save money on the property, but you will also save a bundle when you become an owner-builder in the future and create your new custom dream home.  For more information on what to look for when purchasing your lot, check out our video…Choosing a lot or land.

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