I have been getting quite a few calls lately from clients I have sold homes to in the past who are thinking of selling their homes and want my advice. I need to tell you, I love getting these calls! Firstly, I really enjoy the people I work with. I like hearing about what they have been up to since we last chatted, I love hearing about their kids, dogs, renovations, promotions and all the rest. Life, however, has a way of happening when we least expect it and, even in a not so great real estate market, sometimes people need to move on. Even though I know they like telling me about what they have been doing, I know the real reason they want to talk to me is to find out 3 key things…1. What their home is really worth…..2. What they need to do to it to get it market ready.….and 3. How long will it take to get it sold.
When I talk to people about selling their home I ask them to consider 7 things before they make the decision to put their home on the market to better ensure them as good an outcome as possible. An informed, prepared consumer makes good decisions whether buying or selling a home….so please, be informed, be prepared.
1. Motivation. Why are you selling? Your motivation always determines your marketing plan and ultimately your success in getting your home sold. Someone who tells me….Well.. if I can get “the right” price for my home I’ll sell it. If I can’t, I’ll just keep it. This kind of motivation guarantees that you will be living in your home for a good long time to come and that is fine if that is what you really want to do. So really think about the reasons you want to sell, make sure they fit into your life plan and financial situation.
2. Pricing. The market always determines the price. It did 10 years ago and it does today. Homeowners who price their home at or very near to where the eventual selling price will be get their homes sold faster, with a more motivated buyer and, believe it or not, for more money than they would have if they had over-priced it in the beginning. Why does that happen you ask? Well….buyers are looking for certain features in a home. When they are looking at your home and it is over-priced, the other homes they are looking at are a different product. When they see your home they know immediately it is nice but not what they are looking for so they move on. So when a homeowner says, “So why don’t they make an offer?” Well, the answer is simple…it does not occur to a buyer to make an offer because your product is not what they are looking for in the first place. So work with your Realtor and be very realistic when setting that original asking price. You will be happy you did.
3. Preparation. Homes that sell quickly and for top dollar are prepared to show. It is as simple as that. So before you think of putting your house on the market roll up your sleeves and look at it like a buyer would. Park out front and say to yourself, “Would I even want to get out of the car to look at this house?”. If the answer is no then get to work weeding, mulching, trimming and painting. A buyer cannot buy your home if they won’t get out of the car. Then go room to room on the inside and remove clutter, family photos, collections, clean out closets, neutralize bold colored paint, remove heavy drapes from windows, fix those loose knobs and fixtures, clean dirty carpets and replace old carpets and just plain clean. It may not be the way you live or want to live but….this is no longer your home, it is your product and you want someone to buy it. Work with your Realtor or even a professional stager to get your home showing ready. I guarantee you will be happy you did.
4. Market it. This sounds like…well duh! Isn’t that what I called my Realtor to do in the first place? Well, think about what it really means to market your product. You will play a very key role in the process. Buyers will need to see your product in order to buy it so you will need to make it available to be seen…..even when it is not completely convenient for you…like dinner time, nap time, I had a showing at 1 and now someone wants to come at 4…can’t they come closer together…… You will need to have your house available for public open houses and brokers’ open houses. You will need to have contingency plans for your pets and children to get them out of the house while buyers are looking at it. It is most important that a buyer sees themselves living in your home, not you. You will need to be sure your product is showing ready every day because you NEVER know who that buyer is that will fall in love with your home. Discount no one and show it to anyone who wants to see it. Ensure your Realtor can get your home high visibility on all the websites with multiples of good photos, a visual tour, even web presence with its own URL or YouTube video. It is a digital world out there and that is where buyers are going to look for their next home….make sure they find it.
5. Getting the Offer. So you have an offer…what are you going to do with it? I’ll tell you what you should do with it…swallow hard and negotiate it. If I can give any homeowner one guarantee in this crazy real estate market it is that when you get that offier….it will be lower than you had hoped it would be. That first buyer, though, is your most motivated buyer and this is probably your most workable offer, so put pencil to paper, get out the calculator, strategize with your Realtor and counter it. Be prepared to go a few rounds with the buyers if necessary but come to consensus, quickly, before the buyers lose interest and move on. From experience, I will tell you that if you can’t work this offer out it is highly likely the next offer will be lower. Remember, too, that there is more to an offer than price. Terms and conditions can make or break a deal. It is often more prudent to take a little less than you would have liked in exchange for a buyer who is well qualified, motivated and can make it to the settlement table.
6. Home Inspection. Ahhh….so you think you have everything worked out? Ha! Please remember that no house is perfect. And even though this is your house and, after all, what could possibly be wrong with it…. yours is not perfect either. Even when someone buys a brand new house there can be defects which is why home builders always have a “punch list” after settlement. So, when the buyer comes back with their list of defects they want you to fix before settlement, look at it objectively. Health and safety concerns are legitimate. Environmental defects are legitimate. Malfunctioning systems are legitimate. You would not buy a house with high levels of radon or a clogged up waste pipe or a corroded HVAC system or a roof that has exceeded its useful lifespan so don’t expect your buyer to either. If you own a home you must maintain it. You can do it while you are living there and can enjoy it or you can do it when you sell….but either way, you will maintain your home.
7. Appraisal. The wild card of the home sale process. When you sell your home you actually do it twice. First you have to get a buyer to be willing to buy it. THEN the buyers’ mortgage company has to agree that the price the buyers are paying is what the house is actually worth. If the bank, through the appraisal, determines the house is worth less than what the buyers are paying for it the bank may decline the buyers’ mortgage. If they will not lend the buyers the money, they cannot buy your house. If the buyers cannot buy it you are back to square one. So…if you find yourself in this kind of situation you will once again need to swallow hard and make some tough decisions. Although every Realtor has seen the occaisional bad appraisal, they are usually pretty good these days so if you are seeing this number now…you will see this number again, or maybe less, with the next buyers.
So now you’ve made it through the whole process and you are sitting at the settlement table with the buyers hopefully having a “love fest”. Congratulations! You are all talking about what a great house they are buying and what a great neighborhood it is. You are telling them when trash day is and which neighbor will lend them a cup of sugar and how your kids graduated from the elementary school down the street, etc, etc. Your house is sold. You had the right motivation, priced and prepared it well, made it available to be seen, lived through the negotiations of the agreement of sale and home inspection, the house appraised and the buyers were ultimately able to get to settlement. Whew! Happy day! Good luck in your next place as well but……keep in touch with the Realtor that helped make all this possible because…..life happens when you least expect it and you will need them again.