By Colin R. O'Leary
October 30th, 2018
The decisions a seller makes when preparing the sale of a property will have major consequences on the outcome. The most important thing on most sellers mind is usually the net or the amount of money the will walk away with after paying taxes and fees at closing. The decisions a seller makes before listing a property will determine whether or not the experience is a positive or negative one. When selling property in today's market, knowledge is power. Making the wrong decisions can be costly and time consuming. Here are a few common questions that I usually hear from my seller clients, and my responses.
How much is my home worth in today's market?
Answer: This is usually the question that sellers are most eager to learn. Websites such as Zillow can give you an idea of what the home may be worth, but this number is often misleading and sometimes can be way off. The true value of any property is ultimately determined by the market, and what a buyer is willing to pay for the property at a given time. It's best for a seller to contact an experienced listing agent who can provide an accurate real-time CMA or comparative market analysis before you list the property. The comparative market analysis will provide detailed information such as recent sales, current listings (competition), and listings that are in-contract. This information will help determine the current retail value of the property.
How long will it take to sell my home?
Answer: Most sellers are unaware of the lengthy process it can take to sell a home. The average time a house sits on the market before entering contract varies depending on the market and property type. The key to selling a property quickly is not just great marketing, but the pricing strategy. The amount of time a property sits on the market can be directly related to its price. If a property is listed near the actual retail value of the property, based on the competitive market analysis, there should be a contract on the property within a few weeks or days depending on the strength of the market.
Even with the greatest marketing in the world, if a property is overpriced, it could take months or even years to sell. Even worse, it might not sell at all. If the property is under-priced, it might sell quickly, but a seller could be leaving a lot of money on the table. Determining the proper retail value of a home when first listing the property is crucial to help avoiding these mistakes.
Are Open Houses important?
Answer: Yes Open Houses are important. First and foremost, it's in the best interest of any seller to expose the property to as many people as possible. This will help net the highest price possible for the property. Open Houses help create excitement and demand for a new listing.
What do I need to do to prepare my property for the market?
Answer: It's always in the best interest of the seller to prepare the property as best they can before putting the home on the market. Neglecting this can have a major impact on the sales price received for the home. First and foremost, hiring an experienced brokerage to handle the sale of the property is important. You want to put out the best possible image of the property. This means professional photography and floor-plans at the bare minimum.
Simple fixes like painting, cleaning, and sprucing up the curb appeal of the home can go a long way. It's best to remove as much clutter as possible from the interior of the property. It's helpful to remove any family photos so potential buyers can imagine the property as their own. Before Open Houses or showings, make sure not to smoke inside of the house for at least one day, and again to remove pets and any other potential distractions. Simple things like music and candles can help create a positive ambiance when the property is shown.
What closing costs should I expect?
Answer: Realtor commissions usually make up the lion’s share of the closing costs. Typical commissions range from 5-6% of the apartment/building price in NYC. Transfer taxes are another closing cost. Transfer taxes are usually paid by the seller (unless it’s a new development). The New York City Real Property Transfer Tax is 1% of the price if the value is $500,000 or less, or 1.425% if it is more. Unfortunately, New York State also has a transfer tax. New York State charges you an additional 0.40% transfer tax on the purchase price.
Another closing cost to keep in mind is attorney fees. Most real estate attorney fees will generally range anywhere from $2,000-$5,000 for the transaction. Real estate attorneys in NYC typically charge you a flat fee upon the closing of the real estate transaction.
Finally, you could be on the hook for capital gains taxes, especially if the property has risen significantly in value since it was purchased. While this isn’t technically a closing cost, it is certainly something you should consider. If you are selling your primary residence, you have lived there for 2 years or more, and are married, you can typically exclude the first $500,000 in capital gains. If you are single, it would be approximately half of that or $250,000.
By Colin O'Leary
October 22nd, 2018
Home buyers and sellers are empowered today like never before. New technology has disrupted nearly every industry, including the real estate industry. Some homeowners are choosing to sell their house without the help of a real estate agent. It's easier to do today than it was 10 years ago due to technological advances and access to information on the internet. Still, it's not an easy task and can be very time-consuming.
Each year many homeowners will try to sell their home on their own. Some are successful, others end up listing with an agent after unsuccessful attempts to sell on their own. According to a statistics from the National Association of Realtors, approximately 89% of all home sellers in 2016 did so with the help of a real estate agent.
If you are the ambitious type and want to try to sell on your own, here are some tips to help you maximize the value you can receive when selling on your own. I've put together a list of 5 things you will need to do in order to successfully sell your home without a real estate agent.
1. Pricing your home
The biggest mistake a homeowner can do is to overprice the property. Home buyers are more educated and more sophisticated than ever before. They are not going to overpay for a home, no matter how great the marketing is. When you work with a real estate agent, they will provide you with a comparative market analysis that is tailored to your specific market. This report is used to price the property.
The comparative market analysis takes into account recent past sales, listings in-contract, and active listings for comparable properties. This information can be found online but must be analyzed correctly or it can affect the sale of your property. For example, if a seller overprices the property, it could sit on the market for months or even years. If a seller under prices the property unwittingly, it could end up costing a lot of money.
2. Hire a professional photographer
When a seller lists the property with a real estate firm, they are provided with professional marketing services. This usually includes professional photos and a floor plan at the minimum. If you decide to sell the home on your own, be prepared to pay for professional photogrpahy for the home. It's important that the property is properly advertised, which includes professional photography and a floor plan at a minimum. Listings with bad photography are often overlooked by potential buyers which can result in the property selling for less than it should.
3. Marketing the property to potential buyers
If you are a home seller and want to get top dollar for your property, be prepared to spend money on marketing expenses. Some homeowners think they can stick a sign in front of the house and sell for top dollar by catching a lucky drive-by buyer. Others think that they can simply place an ad on Craigslist and receive top dollar for their property. This strategy will only limit the quality of offers you will receive on the property. It could cost you big money in the end.
When you list with an agent, the property is usually heavily marketed on multiple websites and print publications that reach thousands of potential buyers. In addition, when you list with an agent, the property is displayed on the local MLS (Multiple Listing System). The MLS system is used by thousands of real estate agents to share listings on a daily basis. These agents are working with potential buyers for your home. When you sell on your own, you will lose out on this potential market.
If you decide to sell the home on your own, be prepared to spend money to market the home to reach as many buyers as possible. This includes listing the property on as many websites that allow For Sale by Owner listing's as possible. Generally speaking, if you want to get maximum value for the property and not undercut yourself, you need to do everything you can to try to reach as many potential buyers as possible.
4. Showing your home
If you decide to sell the property without an agent, be prepared to deal directly with potential buyers. When potential buyers are knocking on the door or calling you, how do you know if they are actually qualified to buy your property? There are plenty of people out there who will waste your time. Some buyers who come to view the home may not be able to afford. Others may have not yet been approved for a loan yet by a bank.
Real estate agents usually act as the buffer between the home seller and potential buyers. A good agent will make sure that your property is shown to only qualified buyers. If you decide to list the house on your own, be prepared to show the property on your own. Be prepared to deal directly with buyers and the banks to make sure your buyer is qualified. It's important to make sure you are only showing the property to qualified buyers so you are not wasting your time and energy.
5. Educate yourself on the negotiation process
So you decided to sell the house on your own and now you found a potential buyer. You already made sure that the buyer is qualified to purchase the home, either with a bank loan or with all cash. What do you do now when you receive an offer? What if they are multiple offers? Do you accept or counter-offer? The way you respond is crucial. If you make the wrong decision, it could end up costing you a lot of money.
When selling a property on your own, it's important to understand the mindset of potential buyers for your home. Some buyers actually prefer to deal directly with sellers. Some buyers think they can get a better deal by going directly to the seller, rather than having to negotiate through a real estate agent with expert negotiation skills. Sometimes its true, especially if the seller has under-priced the property unwittingly. It's important that you educate yourself as much as possible about the negotiation process before decide to list the property. If you make the wrong choices it can cost you big time.
By Colin R. O'Leary
October 22nd, 2018
There is a constant battle we all deal with. Difficult situations and obstacles in life are unavoidable. How you respond to these obstacles is crucial to your success. Some people say success is a mindset. I believe that success ultimately comes from a combination of a positive mindset along with taking action. Keeping your composure is crucial to dealing with difficult situations as they arise. Here are 10 powerful quotes from some of the most brilliant leaders you can use to start the day right. Enjoy!
1. Too many of us are not living our dreams because we are living our fears. - Les Brown
2. We must all suffer from one of two pains: the pain of discipline or the pain of regret. The difference is discipline weighs ounces while regret weighs tons. - Jim Rohn
3. People are like dirt. They can either nourish you and help you grow as a person or they can stunt your growth and make you wilt and die. - Plato
4. Be more concerned with your character than with your reputation. Your character is what you really are while your reputation is merely what others think you are. - John Wooden
5. Nearly all men can stand adversity, but if you want to test a man's character, give him power. - Abe Lincoln
6. Think twice before you speak, because your words and influence will plant the seeds of either failure or success in the mind of another. - Napoleon Hill
7. People buy into the leader before they buy into the vision. - John C. Maxwell
8. Courage is contagious. When a brave man takes a stand, the spines of others are often stiffened. - Billy Graham
9. Accept the things to which fate binds you, and love the people with whom fate brings you together, but do so with all your heart. - Marcus Aurelius
10. The human race has one really effective weapon, and that is laughter. - Mark Twain
53W53 is a brand new 950 ft' highrise condo in midtown Manhattan
Each month I write the O'Leary Market Report to bring you the latest real estate news out of NYC. We are almost a month into fall now. After a warm couple of weeks to start the fall, its finally starting to cool down. The leaves are starting to change colors and its beginning to feel like fall.
The economy is booming. The U.S. unemployment rate fell in September to 3.7%, the lowest since 1969. However, mortgage interest rate have risen slightly, and there is still uncertainty in the New York City real estate market.
In Manhattan, it's a buyers market right now. There's plenty of supply for the top end of the residential market. As a result, sellers are beginning to slash overpriced listings. The change in the SALT cap deduction is on the minds of a lot of buyers and sellers. The median sale price for a condo, co-op, and townhouse have all decreased.
The number of listings on the market as of October 10th, including all condos, co-ops, townhouses, is currently hovering around 7,300. According to the real estate data website Urban Digs, that's a 22% year-over-year.
There's a significant amount of new development inventory that just hit the market. There are currently 2,260 new development listings on the market in Manhattan alone. New construction activity is not slowing down anytime soon. The New York City buildings department issued a record number of permits in 2017. The buildings department has created an online construction map, which tracks every major project (residential & commercial) across the five boroughs in real time. As of October 11th, there are a total of 7,435 active building permits across the five boroughs.
The median sales price of a condo selling in Manhattan as of July was $1,595,000, a price decrease of nearly 12% year-over-year. The median sales price for a co-op was $841,500, faring slightly better at a 2.5% price decrease year-over-year. For townhouses, the median sales price was $4,808,000, down significantly 23% year-over-year.
The number of deals happening in Manhattan has declined since last year. A total of 587 contracts were signed in September, a near 15% decrease year-over-year. Listings are taking longer to sell too. The average time a listing spends on the market in Manhattan is 79 days, an increase of nearly 18% year-over-year.
The sales market in Brooklyn is still a sellers market. Brooklyn, home to over 2.5 million residents, is one of the hottest real estate markets in the world. Over the past decade, Brooklyn has attracted new residents from around the world with its trendy neighborhoods and more affordable prices than Manhattan.
Prices have risen significantly over the past decade in Brooklyn. There is still plenty of demand from buyers, especially on the lower end of the market for the buyers priced out of Manhattan. Developers have taken notice. Construction activity can be seen all over the borough to meet the demand.
According to Urban Digs, the median sale price in Brooklyn for a condo as of July was $987,500, an increase of 6.2% year-over-year. The median sale price for a co-op was $477,500, a decrease of 4.5 % year-over-year. The median sale price for a townhouse was $928,600, a 5.2% increase year-over-year.
According to Zillow, the median home value for all homes in Brooklyn is $786,300 as of September. Home values have gone up 6.6% over the past year in Brooklyn. Zillow is optimistic about the Brooklyn market. Zillow predicts median home values will rise 6.7% over the next year.
Coming soon to market!