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Selling your Home: Combating Competition from Distressed Properties

Whenever there are a large number of homes on the market for sale, it has always been difficult for sellers to compete. In the current market, the problem has become even more intensified by the number of foreclosed homes on the market. Around the country, the real estate market has been heavily impacted by both the number of foreclosed homes for sale as well as the number of homes that are bordering on foreclosure; often referred to as distressed properties.

Although there may not be much you can do about the competition if you are a homeowner struggling to sell your home in the current market, there are some other positive steps you can do to make your home more competitive. First, you need to know exactly where you stand in terms of the number of homes in your neighborhood that have sold recently and how many of those homes were actually foreclosures and how many were short sales. You should also make a point of finding out the conditions of those properties at the time they sold. Condition always has an effect on the sales price of a home. There is sometimes a misconception that a distressed or foreclosed property is going to be in poor condition, but that is not always the case. The more you can find out about the properties for sale in your neighborhood the better. While a foreclosed property might be priced lower and initially seem more attractive to buyers, if there are issues with that home, your home can still be worth more and remain competitive because it is in better condition and move-in ready.

You may also find it a good idea to be proactive and have your home inspected prior to placing it on the market instead of waiting until you have an offer. You will pay an upfront fee of a few hundred dollars for the inspection, but it can be a good investment overall. Carefully review the inspection report and make sure that all areas of concern have been addressed and corrected.

In addition, view your home with a critical eye and determine whether it could benefit from any cosmetic updates. While it likely won't pay off in the end to make any major home improvements, you can make your property more appealing, especially when compared to distressed properties, by updating light fixtures, cabinet hardware, appliance fixtures and window treatments. These relatively small and inexpensive quick-fixes can make your home stand out.

It is also a good idea to consider either giving your home a thorough cleaning on your own or hiring a professional cleaning service if you do not have time to do it yourself. Nothing turns off a buyer more than a home that isn't sparkling clean. After touring distressed properties that might be in less than pristine condition, your home will stand out like a gem to prospective buyers.

Another good idea is to purchase a home warranty policy. This can be an appealing feature to prospective buyers and can also help to mitigate problems later on. This type of policy ensures that if there are any problems with the major systems in the home, such as the plumbing or air conditioning and heating, they can be addressed. When you close the sale of your home, the policy can immediately be converted into a buyer's home warranty for an additional fee.

You might also find it to be a good idea to purchase an appraisal on your own for your home. Traditionally, the appraisal was not performed until an offer had been made and accepted on the property, but in today's competitive market you might benefit from an appraisal to confirm the value of your home and justify your asking price.

There are also many other ways you can help to separate your home from the throng of distressed properties in your area. One way is to make sure your home has plenty of curb appeal. In many instances, foreclosed and distressed properties have been poorly maintained and might be even damaged. Be sure your home stands out by giving it a fresh coat of paint or at least power washing it. If you do decide to paint, remember to stick with neutral colors. The lawn should be neatly trimmed and all clutter removed. Plant some brightly colored flowers for even more appeal.

The number of foreclosed and distressed properties for sale may not go away anytime soon, but you can take action to make your home stand out from the crowd.



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