Sellers: Don't Make These Mistakes!
If you’re seriously considering selling your home, there are common big mistakes that sellers make - avoid them!
When warming-up to sell your home, there are three important elements of necessary preparation. You’ll want to be financially prepared – know your numbers. Your property must be physically prepared, and your mind must be emotionally prepared for the transaction.
Most first-time sellers have not fully considered the costs of selling their home, especially if they are considering selling it themselves.
Underestimating those costs can create financial surprises – be financially prepared. Part of that financial preparation should certainly include moving costs. In addition, you’ll want to be qualified for your next home, if you’re planning on buying.
Many California homeowners have enjoyed significant appreciation on their home and want to take that equity and use it as a down payment elsewhere in the county. There exists significant math that must be applied to the equation to determine your net sales proceeds after selling costs. Additionally, sellers who become buyers as well are often surprised at the difference in current interest rates compared to their rate on the house they are selling – it all takes an “eyes wide open” approach!
Are You Skilled Enough to Sell it Yourself - For Sale By Owner?
If you are thinking of traying to save on commissions by selling your home as a “For Sale By Owner” or FSBO, you’ll need to be skilled in the entire process. Selling a home takes knowledge and attention to very important detail at all five stages of the home sale process. Expertise in proper disclosures to avoid liability (stage 3) and expertise in qualifying the buyer’s ability to actually close (stage 4) are critical elements of nearly every home sale.
Industry statistics show that 90% of sellers attempting to sell their home without an agent fail. Perhaps trying to avoid commissions and sell your home yourself is a mistake that sellers make frequently.
Should You Renovate or Repair?
There are two schools of thought when it comes addressing a property’s obvious (or not so obvious) deficiencies. Both of these paths are DANGEROUS! If you want a competitive listing, and you know your home needs an update or light remodel in certain areas such as a master bathroom, one of the biggest mistakes is to blindly do the upgrade. You’ll rarely get a full return on your investment in the upgrade.
On the other hand, if there exists a repair that you KNOW needs to be completed, like a plumbing issue that may get overlooked in an inspection, and you decide to ignore it, you could be setting yourself up for a disaster and even a lawsuit from the buyer – disclose it!
Should You Remove Your Personal Belongings?
Properly preparing your home for viewing by potential buyers is a MUST. There are lots of tips on this topic about baking cookies and making the home smell great, but let’s focus on fundamentals. Some of us have decades of personal belongings that occupy every inch of our home. A CLEAN, simple look is best, so consider removing most personal belongings. The buyers want to envision living in the property as if it were their home. All of your possessions may detract from that, leaving them with an “unsatisfied feeling they can’t describe.” – just put off…or worse…repelled by what they saw. DECLUTTER!
Should You Be Concerned About Lighting?
LIGHTING is very important! The old homes of the 50s & 60s gave way to larger homes of the 70s & 80s, and with that transition came the open floor plans with a much larger interior volumes of space in each area of the home. Proper “triangular” lighting strategies should be considered in certain spaces, when the room is not well lit. Each part of each room must be showcased with light! Just think, “Light & bright!”
Should You Stage Your Home?
Homes sold by investors are almost always STAGED with furniture, so the buyer can get a warm feeling and envision living in the space. The decorator quality of the appointments create a model home feel. How do you compete with that? You must consider how your current furniture and decorations (and family pictures) affect the home’s appeal to the buyer. Consider professional staging when necessary – usually it isn’t. But every sale is different.
Is Property Pricing Critical?
Pricing your home is critical, and here is where many owners make BIG mistakes when selling their home! There are four pricing strategies to seriously consider. One of these strategies, simply pricing your home high and traying to draw the buyer’s offers up TOWARDS your asking price…well…that strategy is just DANGEROUS.
Once the home is listed, you have less than three weeks to exhaust the entire universe of buyers that are currently looking at your type of home (location, bedroom / bath count & amenities.) If you don’t have the property under contract after that period, your next supply of home buying prospects are only the incremental new buyers coming in the marketplace and that new buyer supply is comparatively minimal.
Now you’ll be forced to reduce your price every three weeks to gain traction with your buyer audience. At some point in time, the listing becomes “stale.” You then have failed and need to take if off the market for a while so the community of agents will see it come back on as a “somewhat” fresh listing. Some agents won’t even show it - they know the listing address and assume there is a problem with the property because it simply has NOT sold. You have arrived at the worst possible result as a seller.
This means you really have about 2 to 3 weeks or less to attract a handful of quality offers, sort, sift & qualify to get the best one under contract. THAT’S THE JOB AT HAND.
Should You Use Professional Photography?
Always use professional photography. It is worth the investment. Your imagery is the first thing that buyers now see online. RARELY will their first sight of your home actually be while they are visiting the home!
What Strategy Should I Use to Show The Property?
Now it’s time to show the home – get lost! You ad no value to the sales process of obtaining the best terms for your sale. That’s’ the buyer’s agent’s job and buyer…to present the value and see the value for themselves. In nearly every case, you can’t add anything the recipe for success, and you could easily detract from the possible offer.
It’s not a bad idea to have your agent at the showing. At the very least, your agent should be obtaining feedback from the other agent, after the showing.
There are many showing strategies, but you must make your home available. It’s part of the process, so don’t make it difficult or inconvenient. Consider a MEGA Open House and or a showing “period of time.”
How Do You Know Which Offer is The Best?
In come the OFFERS… Remove the EMOTION from the process! Don’t take offense to a low offer. Simply ignore it or counter. The highest offer isn’t always the best offer. What if it DOESN’T CLOSE? Offer sorting and QUALIFYING is critical to the success of the sale. Offers can come with a wide variety of variables that dictate seller circumstances and desires. You do not want to be in a position of canceling an escrow then entering into another escrow with a second buyer to accomplish you goal of selling. This process is NOT like fine wine…it does NOT get better with age!
Who Should Negotiate Repair Requests?
Your transaction is in now fully underway…how do you address SURPRISES with the home inspection(s)? Yes, there can certainly be more than one inspection. The first inspection can reveal issues with require multiple additional inspections.
Third party licensed professionals skilled in evaluating electrical, plumbing, mold remediation, brick fireplace stability, geological - soils, termite damage, etc. can be required. You must remain OBJECTIVE in these circumstances. Being unrealistic may completely derail the sale. Worse, now these issues MUST be disclosed to any new buyers, so you’ll be forced to address these issues when they come up.
Be cautious of investors making cash offers. Most in that business are in it exclusively for money – PERIOD. The price at which they start the offer may not be the price at which they intend to close. Property flippers and real estate wholesalers tend to have marginal reputations.
If you’re going to choose to hire an agent to help you handle the sale of your home, you’ll get a gut feel somewhere in the midst of the process. “Does that agent and team have my best interest at heart?” THAT is your final test. Would your agent be making all the same recommendations if the property were his or her home that was being marketed and sold?
Avoid these big mistakes that many home sellers make! Discover our two powerful options to sell your home. To get professional help from one of our Property Acquisition & Sales Specialists, call 949-268-7742 today!