- Q&A with Lane Hornung.
- Reminder: Your home may be worth more than you think.
- Accepting a contingency offer may buy you time this spring.
It’s a time of new beginnings, cleaning and evening sunlight.
In the real estate world, spring is when home sales typically start to bloom.
The spring home selling season is the topic of this month’s question and answer session between Lane Hornung, founder and CEO of 8z Real Estate and John Rebchook of InsideRealEstateNew.com.
John: Lane, what should homeowners be thinking of as the spring real estate season kicks off?
Lane: First and foremost, homeowners should be thinking about what their home is worth. There is a good chance their home is worth 5,10 or 20 percent more than it was a couple of years ago.
They may think they live in a $300,000 home. But the home might actually be worth $330,000 or $360,000.
John: If a light bulb goes off in their head that their home is worth more than they thought, does that increase the chance they will want to sell it?
Lane: Just by doing the math in their head, a couple of different things could flow from that.
You might have not been thinking of moving, or letting yourself think of moving, but maybe now you realize that it’s an option. Then you will ask: where in the heck do we move to?
John: So a consumer might want to move, but stays put because it is so tough to find a replacement home. How can a homeowner overcome the paralysis?
Lane: There are ways to navigate that chicken and egg conundrum of selling and buying a home in a market with such low inventory.
John: What is one possible resolution?
Lane: The conventional wisdom in selling a home is that you take the best offer from someone ready and able to buy your home quickly and avoid selling to someone who is contingent on selling their home first.
However, the market is so tight that I have heard of some unconventional solutions.
John: That would be accepting a contingency offer?
Lane: Yes, if the buyer lives in a hot neighborhood, there is no question that the house is going to sell. Some sellers appreciate that extra time, which they can spend looking for a home they want to buy. Deals that involve three or more linked transactions, all dependent on the other closings, are becoming more common in this market.
John: That sounds like a scenario that requires having a good broker to make sure that all the trains stay on the track and arrive at the station on time.
Lane: You absolutely need an experienced agent and not someone who is a hobbyist.
It can get quite complicated and you want to make sure the contract has very specific milestones that have to be met.
I know of cases where brokers conducted these linked transactions in a way that everyone involved came out really happy. All the parties involved found a solution to the challenge of both selling and finding a replacement home. It can be a home run for everyone.
John: Thanks, Lane.
8z Real Estate is a sponsor of InsideRealEstateNews.com along with Universal Lending and Land Title Guarantee Co. A monthly Q&A with Lane Hornung is a feature of IREN. Have a story idea or real estate tip? Contact John Rebchook at JRCHOOK@gmail.com. To read more articles by John Rebchook, subscribe to the Colorado Real Estate Journal.