“9”
Mistakes of Selling a Home ...
When you are getting ready to put your
property on the market, there are a number
of things to think about, to prepare for and
to organize. Here's a short list of some of
the pitfalls to watch out for!
Mistake No. 1
- Pricing Incorrectly
Every seller wants to realize as much
money as possible when he sells his home.
If your house is not priced competitively,
people who are looking in your price range
will reject your house in favor of other,
larger homes at the same price. At the same
time, the people who should be looking at
your house will not see it because it is
priced over their heads! Overpricing
usually increases the time on the market,
and that adds to the carrying costs.
Mistake
No. 2
-
Failing to "Show Case" the home
Buyers look for homes, not houses,
and they buy the home in which they would
like to live. Owners who fail to make
necessary repairs, and who don't spruce up
the house inside and out, touch up the paint
and landscaping, and keep their home clean
and neat chase buyers away as rapidly as
Realtors can bring them.
Hiring a
professional home inspector can help listing
your property. Why, because, if
your home is in top condition you'll get the
highest price and to the closing quicker
with fewer surprises.
This gives you two
options. First, the home can be presented
"as is" and reflect any problems in the
purchase price. This allows you the option
to negotiate with a buyer to accept items in
the current condition by stipulating that
they are reflected in the purchase price.
If you hadn't identified these problems a
buyer may walk away from the deal if the
conditions come as a surprise after an offer
has already been made. You know the buyer's
inspector will find them, at the worst
possible time, causing delays, and costing
you more money.
Secondly, you can have
the problems fixed before you list so they
don't become an issue between you and the
buyer.
The
inspection should be done as early as
possible once you have made the decision to
sell your home. This way,
if there are any problems discovered that
need to be repaired, you can have the
repairs done on your own terms and schedule.
When a problem isn't found until the buyer
has an inspection performed, the deal you've
worked so hard to get done may fall apart
unless you act quickly to get the repairs
done. Or you may have to take a lower price
in order to keep the deal. You'll most
certainly have more headaches and spend more
money than if you'd known about the problem
and had it repaired before negotiations
began. Buyers appreciate knowing the
condition of the major elements of a home
upfront.
Knowing what's wrong with your home in
advance allows you to shop around and get
competitive bids from contractors, rather
than being forced into paying for a rush job
at the last minute. You also have
the flexibility to choose the materials and
methods used in the repair. By identifying
needed repairs early, you'll have the option
to save money by using less expensive
materials for the repairs.
Mistake No. 3
- Using the "Hard Sell" during showings
Buying a house is an emotional
decision. People like to "try on" a house
and see if it is comfortable for them. It's
difficult for them to do that if you follow
them around pointing out every improvement
you've made. It may even have the opposite
effect you want, by making them feel they
are intruding on your private space. Resist
the temptation to talk the entire time a
buyer is there... let them discover things
on their own. Try a tasteful sign posted on
a door or wall to point out some hidden
amenity that they might miss.
Mistake No. 4
- Mistaking lookers for buyers
For Sale By Owners always get more
activity than houses listed with an agent.
No question about it! Realtors will only
bring qualified buyers, and these will be
fewer than if you open your front door to
everyone who walks down the street. A
qualified buyer is one who is ready,
willing, and able to buy your house. We
find that most people who go looking at “For
Sale By Owners” are just starting to think
about moving. They may be potential buyers,
but they're just 6-9 months away from being
ready. They don't want to bother an agent
yet, so they call the "By Owner" ads to get
a feel for what's available. Many potential
buyers may have to sell their house first,
or may need to save some more, or may have
credit that needs fixing. When everything
is in place, that's when they go out looking
with a Realtor. An agent will ask a buyer
how much he can really spend for a house,
how much he has to put down, how good his
credit is, how much he can pay each month,
how much he will realize (realistically!)
when he sells his present home - and many
similar questions. But unless you have a
Realtor who finds out the facts first, you
should ask all these questions before the
buyer crosses your threshold. Otherwise, you
may have a parade of Sunday afternoon
shoppers with a dream of owning a home some
day.
Mistake No. 5
- Not knowing your rights and obligations
Real estate law is extensive and
complex; the contract of purchase and sale
is a legally binding document. An
improperly written contract can cause the
sale to fall through, or cost you thousands
of dollars for repairs, inspections, and
remedies for items included or excluded in
the offer. You must be certain which
repairs and closing costs you are
responsible for. You must know whether the
property can legally be sold "as is", and
how right-of-ways and local zoning may
affect the transaction. If there are
defects in your title, or if your property
is in conflict with local restrictions, you
must remedy them, or you might have to pay
plenty.
Mistake No. 6
- Limiting the marketing and exposure of the
property
The two most obvious marketing tools
(open houses and classified ads) are only
moderately effective. Surprisingly, fewer
than 1% of homes are sold at an open house.
Agents use them to attract future prospects,
not to sell your house! Advertising studies
show that less than 3% of people purchased
their home because they call on an ad. And
if a machine answers, most callers hang up
without leaving a message. The right
Realtor will employ a broad spectrum of
marketing activities, emphasizing the ones
he believes will work best for you and your
particular property. There are dozens of
more effective ways to find buyers than just
open houses and classified advertising.
Mistake No. 7
- Limited Accessibility
Studies show that the homes that are
shown the most are the ones for which
Realtors have keys or lockboxes. Realtors
take the path of least resistance just like
everyone else. When faced with the choice of
making several calls to set up an
appointment or simply going directly to the
home and showing it, they will often opt for
the latter. Also, it's easier for a Realtor
to persuade a buyer to look at something he
may otherwise not agree to see if the
Realtor and buyer can just pop over and get
inside and not spend more than a few minutes
doing so. Many homes are sold to buyers who
wouldn't have looked unless they were
persuaded to in just such a fashion.
Remember, the more times your home is shown,
the greater the chance it will sell.
Mistake No. 8
- Believing that a
government assessment or bank mortgage
appraisal is the market value of your house
An appraisal is an opinion of value
for a certain purpose. If the lender wants
to lend you the money, he is motivated to
have the appraisal come in high. The
appraiser may ignore foreclosure or distress
sales in order to justify the higher value.
But a real buyer in the real world will not
ignore these properties. These homes are
the competition you try to sell. I can't
tell you how many ridiculous bank mortgage
appraisals I've seen. Because many buyers
are only making 5 or 10% down payments,
appraisals are much more critical as to the
value because the banks want to avoid the
potential of foreclosures. Don't make the
mistake of thinking that the value you were
told even 6 months ago when you re-financed
is what a real buyer will pay today. Ask
your Realtor for ALL the sales in your area,
then decide.
Mistake No. 9
- Choosing the wrong Realtor, or choosing
him for the wrong reasons
It's likely that you don't interview
people very often. And yet in order to find
the Realtor who is right for you, you may
interview a couple. The quality of your
home selling experience is dependent upon
your skill at selecting the person best
qualified. It's interesting that in the
real estate business, someone with many
successfully closed transactions usually
costs the same as someone who is
inexperienced. Bringing that experience to
bear on your transaction could mean a higher
price at the negotiating table, selling in
less time, and with the minimum amount of
hassle. The sale of your home could well be
the most important financial transaction you
have every been involved with. The person
you select can make it a satisfying and
profitable activity, or a terrible
experience. It's your home and your money.
The choice of your Realtor is up to you.
Make the selection carefully.
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