Real Estate NewsMistakes All Sellers Make
Selling a home is something you either want to do or are forced to do, and
naturally, you want to make the most money you can from the transaction.
Whether you have been transferred and have to sell immediately or you"re
retired and have all the time in the world to test the market, you should do
the most you can to bring the best price possible for your efforts.
The easiest way to do that is to avoid the most common mistakes that all
sellers make.
1.Not interviewing enough REALTORS®
According to the National Association of REALTORS®, 63 percent of home
sellers interviewed only one Realtor before listing their homes. And 18 percent
only interviewed two real estate professionals. So the first agent in the door
is the most likely one to get the listing. By interviewing only one or two
Realtors, you are only assured of meeting the most aggressive Realtor, not
necessarily the one with the best marketing plan for you and your needs. Ask
your friends and associates for recommendations.
Today, many Realtors have specialties that may fit your needs. If you are a
senior citizen for example, you may be better served by a Senior Real Estate
Specialist or someone carrying the SRES designation. If you are relocating, and
need special help, a relocation specialist can help pave the way. If there are
complications to the sale of your home and you require real expertise,
interview Realtors with the CRS designation.
Also See: Advice for Finding an Agent
Trusting your most important asset to the first person you meet simply
isn"t the way to do business.
2. Choosing a REALTOR® based on how high s/he is willing to list the
home.
After showing you a comparative market analysis, examining your home,
viewing your competition in the neighborhood, and giving you an honest opinion
of what the home should fetch in today"s market, your Realtor should have a
pretty good idea how much and how quickly your home will sell.
But many sellers have their own ideas. They want top dollar whether the home
warrants it or not. To get the listing, the REALTOR® may sense this and play to
your ego. Why? Because the Realtor can"t lose - even if s/he doesn"t sell your
home.
As long as his/her sign is in your yard, the agent will receive free
advertising. S/he gets calls as people drive by your home and see the sign. If
your home isn"t for them, they will let your agent show them others. Once in a
while you could get a legitimate offer, especially from an unrepresented buyer
or a buyer who is represented by a traditional agent and acts as a sub-agent to
the seller"s agent. But the chances are slim.
The agent also knows that after the home doesn"t sell, s/he can come back to
you (S/he"ll skip the "See? I told you so!" part) and you will allow a price
reduction. Then the home will sell.
The problem with that reasoning is that if you are forced to reduce the
price, you will likely end up with less than if you have priced it correctly in
the first place.
Why? One of the things buyers check when they shop homes is how long it has
been on the market. If it has been too long, they think bargain. The odds are
good that you will be offered significantly lower than the Realtor would have
priced your home in the first place.
3. Choosing agents who advertise only in the local market
Many agents are still fighting progress tooth and nail, and they still
aren"t ready for the Internet or any other kind of national, let alone
international marketing campaign.
Home sales do occur at the local level, but there are also many free or low
cost, effective Internet sites, home magazines, and national classifieds that
produce results. If your agent doesn"t have a marketing plan that includes
national exposure, s/he is relying too much on other agents to sell your home.
Without a comprehensive marketing plan, you are basically paying a
multi-thousand dollar commission for a one-hour interview, a sign in the yard,
and a listing with the MLS. If you are lucky, you"ll get an ad and an open
house.
Shouldn"t you be getting more for your money than that?
4. Overpricing the home
It is human nature to regard what belongs to us with the eyes of love.
Aren"t our children more beautiful? Aren"t our mates more desirable?
Our homes are no different. Beauty is in the eye of the beholder, and that
is why almost all sellers are tempted to overprice their homes. A high price is
prestigious. It shows everyone how important you are. But a high price will
also eliminate your buyer.
Most buyers are pre-qualified. They know what range to look in. If your
home is overpriced, they will compare it to other homes in the price range that
offer more, and pass on yours. Many buyers in your range won"t even look
because you have eliminated the ones who are willing to buy at the top of their
range.
5. Putting too much value on personal improvements
Everybody customizes a home when they move in. You like wallpaper, another
likes grass cloth. You like open spaces, someone else may favor nooks and
crannies. People have different tastes and priorities.
That swimming pool you put in for $30,000 is terrific, but the next buyer
may view it as a financial drain. Especially if it is over 10 years old. You
see, improvements age, and when they age, they can be repair and maintenance
nightmares.
Real estate expert David Knox asks his sellers who are tempted to overprice
improvements, "If you had known you were moving, would you still have made this
improvement?" Usually the answer is no. And the buyer will most likely agree -
with a fair offer for the home.
It"s best to look upon improvements as something you did to please yourself,
but don"t expect updates to add value to the home.
6. Mistaking activity for interest
When people are interested, they make offers. If they aren"t making offers,
something is holding them back. Many agents routinely ask for feedback whenever
your home is shown, but a lot of agents don"t follow through with this
courtesy. But feedback is crucial to understanding why you aren"t getting
offers on the home. The lack of response is usually due to two things - the
home is in poor condition and/or it is overpriced.
7. Failing to prepare the home for sale before it goes on the market
Preparing the home for sale can include everything from spring cleaning, to
repainting, to clearing out clutter, to making repairs, and so on. It"s hard
work!
A lot of headaches can be saved by having the home professionally inspected so that you are not blindsided by unexpected problems and repairs found by the buyer and his/her inspector. A preemptive inspection allows you to make the repairs and assists you with providing a more accurate disclosure.
Many people leave their exteriors and interiors as is, but if you haven"t
updated in years and the home looks outdated, your home will not compare as
well as others who have taken the time and gone to the expense to freshen the
home. Also keep in mind that you are competing not only with homes in the
neighborhood but with new homes as well.
Today"s buyer wants what the new homes have. If they can"t get it, they will
settle for a mature home with fresh paint and everything in working order. The
home must "feel new."
8. Failing to heed the advice of experts
When you are represented by a good agent, s/he is trained and has experience in the marketplace. Many sellers like to remain in control by telling the agent what to do. If you tell an agent you insist on having an open house, you are already demonstrating your lack of knowledge of what sells homes. Very few homes sell through open houses - but your agent will be happy to have one for you and pick up some new clients. The same holds true for negotiating. If you are the kind who draws a line in the sand, there is no point in your being represented at all. Your agent won"t be able to help you. But if you are willing to listen and weigh what the agent is telling you, you will know from the forward progress of the transaction that you got sound advice.