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CNN Sunday Morning

How Can You Maximize the Value of Your Home?

Aired August 05, 2001 - 08:16   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
REA BLAKEY, CNN ANCHOR: Well, summertime is the hottest time of the year in the housing market. School is out, people are on the move. With a look at how seller's can maximize the value their homes, we turn to Brad Inman, who is CEO of HomeGain.com, that's a Web site that connects consumers and real estate agents. He's with us from San Francisco this morning.

I know it's bright and early there, thanks for joining us. How can sellers maximize the value of their home?

BRAD INMAN, CEO, HOMEGAIN.COM: Well, right now it's important that home sellers prepare their home for sale. And it's really small improvements like simple landscaping in the front, cleaning out the clutter, really getting your house ready so it shows well. It's that first impression that makes the difference for home buyers that walk into your home.

BLAKEY: And at this point, are there some markets that are hotter than others in regards to the ability to sell?

INMAN: Well, the whole country, for about seven years, has had a very hot housing market. In the last year, homeowners benefited from 9 percent increase in the median home price, but there are markets that are starting to slow, like San Francisco and parts of the East Coast. But, Texas, Florida, Southern California, Atlanta, we still -- the Midwest, are very, very strong housing markets and they're really, in some ways, carrying the economy.

BLAKEY: And now, we've been talking about a potential economic slowdown in the this country. How is that effecting the housing market? Are the two greatly intertwined, or does housing pretty much keep moving on despite the economy?

INMAN: Well, it depends on how bad the economy gets. If people start feeling uncertain about their employment picture, either they lose their job or their spouse, or they don't get that bonus or promotion, the last thing you do is make the biggest investment of your life.

But the housing market also lags the economy and if we're seeing a slowdown in the economy, it's bound to hit the housing market soon.

BLAKEY: Are the older homes selling more likely than newer home construction? INMAN: Really both. New homes and resale's are doing extremely well, or have in the last year. But the first blip we saw is in the last month, where we saw a slight decline, and we're also seeing more inventory of homes. More sellers are unloading their homes, and there is fewer buyers. So, we may begin to see later this fall and this winter a slowdown in the housing market.

BLAKEY: All right, so if you're on the other side of the coin, you're a buyer, what do you need to know regarding this market that can really make a great impact in your ability to get the most home for the least amount of money?

INMAN: Well, Rea, it's very important that home buyers get prequalified. They get preapproval for that mortgage, and they also take their time to really understand the market; see a lot of homes, really think through your decision. We're no longer in a seller's market. It's turning to a buyer's market. So, that buyer can be patient and careful. Consumer beware is the watchword for the home buyer.

BLAKEY: All right. And certainly, checking out a Web site like yours might be a helpful addition, right?

INMAN: That's right. There is a lot of information on the Internet; new home listings, existing home listings, home valuations, how to pick an agent. The Web offers a lot of insight for consumers that want to be smart about that decision.

BLAKEY: And consumers who might have some mobility, are their certain areas of the country that they should look to?

INMAN: Well, right now it's, you know, where the slowdowns are occurring, for example, in the San Francisco Bay Area, where I am, I would say in about six months you'll see some values because there is a prediction that values here may decline 10 to 25 percent...

BLAKEY: Wow.

INMAN: But that hasn't happened yet. It should happen later this year, then buyer's are going to see a lot of opportunity, not only with lower interest rates but more affordable housing, possibly.

BLAKEY: And so do I hear you predicting that mortgage rates will actually decline as the year goes on?

INMAN: I don't predict interest rates any more than I predict the weather but, you know, right now 30 year fixed rate mortgages are below seven percent, so their looking, you know, very attractive to home buyers, and there is no evidence that they'll go up.

BLAKEY: Well, it sounds as if, Brad Inman, that if we hold on, be patient, get prequalified, we might be able to get a real steal in San Francisco in the next six months or so.

INMAN: I'm not sure about a steal, but more value than you would have gotten a year ago. BLAKEY: All right. Brad Inman, who is the CEO of HomeGain.com. Thank you for joining us this morning.

INMAN: Thank you.

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