Common Mistakes Made by Sellers
Marketing the Home
Effectively marketing the home to buyers is a common mistake made by Sellers. A proper marketing plan allows your home to stand out from hundreds of others on the market, selling its benefits and features.
Conducting open houses and print advertising (the most obvious) are only moderately effective. Statistically, only 1% of homes are sold at open houses and just 3% of people purchased their homes after seeing a print ad! Your Realtor© must employ other methods in order to attract prospects. Ask your sales professional to provide a list of things they will do to market your home.
Listing Price
A listing price should never be based on needs, amount of money invested in renovations, or emotion. A proper listing price must be based on market value. Many sellers have the tendency to price subjectively, commonly termed as Subjective Value. To an appraiser, subjective value is based on emotions. For example, how much a seller paid for their home, how much they love their home, and overall pride of ownership is considered subjective value. Objective Value, is what ALL appraisers base the true value of a property.
Objective value looks at the condition of the property, it’s location, what properties with similar features in the same area are selling for, what other properties in the same area are listed for, and the overall condition of the economy and real estate market.
If your home is not priced competitively, homebuyers will prefer larger or better homes in the same price range, increasing your time-to-sell. When your price is later lowered, buyers may be wary because they suspect other reasons the house has remained unsold so long.
Home Preparation
The failure to adequately “present” the home is common and can be very detrimental to the selling of a home. A property that is not clean or well maintained often suggests hidden defects that increase the total cost of ownership. Sellers should make necessary repairs, and spruce up the house inside and out, keep it clean and neat, or risk chasing away buyers brought in by realtors. Buyers will leave themselves a large margin for error for the cost of repairs, reducing their offer price.
Similar to selling a used car, a dealership will perform detailing, necessary repairs, and expect a higher selling price. A well prepared home that is clean and presentable could mean thousands.
Over Spending
Yes, there is such as thing as “too much of a good thing” when trying to be profitable in the real estate market. If you are hoping that you would like to conduct renovations and necessary enhancements to your home in order to ask for a higher selling price, you may be at risk of not making any profit if your expectations are not line with the current market conditions within your area.
It is a good idea to consult with a Realtor© to assess what your home is worth prior to making any improvements. The following step should be getting written cost estimates for improvements which will help you make an informed decision about whether or not it is a good idea to move forward, or sell as is.
Realtor© Selection
Choosing a Realtor© for the “wrong reasons” can make the overall real estate transaction not only unpleasant, but incredibly frustrating and stressful. Here are some of the wrong reasons for choosing your Realtor©:
- The Realtor© is your relative or best friend
Remember to choose a Realtor© based on their marketing plan, their success rates, and their overall experience and passion in selling homes - The Realtor© you met with quoted a high listing price
This is a bait and switch tactic that must be avoided like the plague!! A high listing price WILL NOT get you a high selling price. A home listed above market value will grow stale and buyers have a tendency to think there’s something wrong with a home that has been listed for a long period of time. - You think the Company’s sign would look great in your yard and their office is just around the corner
It’s not the company that is ultimately selling your home. It’s the Realtor©. Ensure that you are basing your selection on the reputable and trustworthiness of the actual professional you will be dealing with.
Offers (Agreement of Purchase and Sale)
Many Sellers will fail to take the first offer seriously because they believe that this will be the first of many to come and will “hold out” for a higher price. Remember, that you have the ability to counter an offer and that the first 2 weeks of listing a property is the most critical. Never let how quickly an offer comes in affect your judgement on whether to accept or not.
Being Present at Showings
A showing where the owners and family members are present can have a negative impact on the marketability of your home. Many owners feel that they can “market” the benefits and features of their home and will “oversell” to prospective buyers. An experienced Realtor© will know how to effectively market and will provide buyers with information they know will encourage offers on your property.
Also, when owners are present, a buyer will be less inclined to take their time and see your property because they feel that they are being intrusive and will quickly exit the home as soon as they can. A home that is vacant of its owners will encourage a more relaxed atmosphere and will allow serious buyers to inspect your home’s features.
Understanding the Fine Print
An experienced Realtor© will take the time to explain your rights and obligations regarding the written contract. The Agreement of Purchase and Sale contains a long list of legal terminology and clauses and failure to fully understand the terms and conditions could lead to serious problems. An improperly written contract can allow the purchaser to void the sale and ultimately cost you thousands of dollars. Always have your real estate or legal professional explain the contact with you before acceptance.
