Tips for navigating the market in ’08

From the Record:

Laying the foundation for a deal

Heading into 2008, the outlook for housing is more promising for buyers than sellers. Most analysts expect home sales to be slow, with flat or declining prices. But whatever happens, both buyers and sellers can increase their chances of getting what they want by making the right moves. Here are our best tips:

– Become a better borrower. The mortgage industry has tightened lending, and buyers now need better credit histories, and more income and assets.

– Build a bigger down payment — preferably at least 10 percent. The no-down-payment loans that were so prevalent a couple of years ago are scarce these days.

– Shop around for the best housing fit. A few years ago, buyers had to bid on homes as soon as they saw them, or risk losing out. In today’s slower market, there’s a lot of inventory to choose from and buyers can take their time. Take photos and keep records of homes you’re interested in. The more homes you see (especially new construction), the harder to remember which was which.

– Shop for the best mortgage deal. There are still plenty of mortgages out there, averaging less than 7 percent, for qualified buyers. Check regional banks and savings and loans, mortgage bankers and mortgage brokers. Don’t go with the first company you talk to, and don’t just go with your real estate agent’s recommendation.

– Don’t be shy about negotiating; many sellers will accept offers below asking price. But be diplomatic. Realtors say many buyers are coming in with offers so low that they upset the seller.

– Choose your real estate agent with care. There are many who have had no experience in dealing with a housing slump. According to a survey by the National Association of Realtors taken at the peak of the market in 2005, just over half of its members had four years’ experience or less. The last big slump was in the early ’90s.

– Price your home correctly. In a market in which no one is sure whether prices have bottomed out or when it will happen, this is like trying to shoot a moving target. Yet this is the most important part of the sales process.

“Everything in this market is pricing; location is second,” said Antoinette Gangi of Re/Max Real Estate Associates in Woodcliff Lake. “Everyone wants a good price, a steal. If we’ve got a great location, we can hold out a little bit on price. If you have a location near a main road, or there’s a stream or easements on the property, you may have to adjust the price.”

– Prepare your house for sale. You need to de-clutter and de-personalize your space. Think “homey” in a “model-home” kind of way.

– Finally, repeat this mantra often: The first offer may be the best offer. “Usually, your first offer is your best offer,” said Ann Murad of Re/Max Real Estate Associates in Woodcliff Lake. “I put a home on the market in February. It was listed at $469,000, and the sellers got an offer for $445,000. They didn’t take it. Every single offer they got after that kept coming in $5,000 lower increments. They wound up selling the house for $410,000. They said to me, ‘Ann, we should have listened to you.’ “