It’s wise to learn by others’ mistakes. The process of selling your home should be a smooth transaction. Below is a list of mistakes to avoid.
1. Buying a Replacement Home Before Selling Your Home
No one wants to be left out in the cold with nowhere to go, especially if your house sells quickly. To avoid this, you may consider finding a replacement home first before putting your house on the market. Doing this is not recommended because of the high financial risks. It’s far better to sell your current home first than to end up owning and paying for two homes when you only want one.
When you list your home for sale and accept an offer to purchase from a qualified buyer, your buyer will have a contingency period to conduct the necessary inspections and get full loan approval (The buyers contingency period is typically 17 days after acceptance). It’s recommended you go house hunting after your buyer removes all of their contingencies. It is possible to close escrow concurrent with the sale of your existing house and your new purchase. This works best when the sale of your house is a 45 day escrow and the purchase of your new home is a 30 day escrow. An experienced Realtor® can assist you with expediting timelines for concurrent closings.
2. Putting a Home on the Market Before it is Spruced Up
First impressions are everything when it comes to selling a house. When a house goes on the market and it’s a mess, the buyers and real estate agents will remember it that way. It’s best to delay marketing a home until it’s all spruced up. Realtors® are more excited to show homes to their buyers when they are in mint condition.
3. Setting the List Price of Your Home on the Price You Would Like to Get, Rather Than the Current Market Value
It’s natural to want the most money possible when you sell your home. Asking for top dollar makes sense. Asking for a price that is outside of the market range is an issue. Originally, it was thought “sure let’s price the home way above market value and see if we can get it.” This strategy is not recommended. Your real estate agent or a licensed appraiser can provide you with a Comparative Market Analysis (CMA). This will show you the value of your home based on recently sold homes in your neighborhood. With this information, you can determine an accurate list price for your home. The more competitive the asking price, the faster your home will sell.
After you know what your home is likely to sell for, ask your real estate agent to prepare a seller’s net sheet. This will inform you approximately how much money you will receive from the sale.
4. Failing to Get a Termite Report (or Other Reports) Before Listing a Home for Sale
Buyers often ask the Seller to pay for a Termite Report (an inspection report showing the findings of wood destroying pests and organisms) and to pay for the elimination of any evident infestation or infections outlined in the report. Sellers who know the condition of their home before they sell are in a better position to negotiate a firm sale, because they can disclose existing reports on the property to the buyer before acceptance of the purchase contract.
5. Setting Up a Complicated Showing Procedure That Discourages Showings
A house that is difficult to show is a house that will be difficult to sell. The easier it is to show a home, the more often it will be shown, and the quicker it will be SOLD.
6. Insisting on Being Present When the Home is Shown to Prospective Buyers
Buyers like to discover and discuss the positive and negative aspects of your home with their real estate agent as they tour your house. Buyers are reluctant to say anything negative about a home in the sellers’ presence. It’s best to leave your house when it’s being shown to prospective buyers.
7. Refusing to Counter a Low Offer
Sellers like to sell high and get the most money for their home. Buyers like to buy low spending the least amount of money. A high offer from unqualified buyers often leads to disappointment. A low offer from a well-qualified buyer is an offer that should be countered. Just because buyers bid low doesn’t mean they’re trying to steal your property. Low offers are common. It’s highly recommended the seller counter the buyer and start the negotiation process. Many Buyers have a way of moving up in price and often times will result in a deal that is acceptable to both parties.
8. Refusing to Reduce a Listing Price That is Too High for the Market
It’s hard to be objective about the value of your home. This is why it’s important to get a professional opinion before setting a list price. If a property is priced so high that it sits on the market for an extended period of time, people start to wonder what the problem is with the home. This concern comes from both other real estate agents and potential buyers alike. An over-priced listing can sell for less than it would have if it were priced right to begin with. If you find that your list price is too high for the market, reduce your price sooner rather than later. The longer it sits on the market unsold, the lower the ultimate selling price is likely to be.
9. Listing with a Contingency to Find a Replacement Home
Sellers often want a contingency to find a replacement home so they don’t have to move twice. This type of contingency is not recommended. Buyers don’t want to wait for unrealistic sellers to find an acceptable replacement home. Serious buyers make offers on homes that are definitely for sale, not homes that might be for sale. If you plan on finding a replacement home during the escrow period and want to avoid having to move to an interim rental, but don’t think you will be able close concurrent with the sale and your new purchase, make sure the terms of the contract with your buyers states a provision that you may need to remain in possession and rent back the property for a period of time after closing. At least the buyers know they have purchased a home, even if they can’t move in right away.
10. Refusing to do Anything to Get Your House Ready to Sell
The way most people live in their homes is usually very different from the way a home should look when it goes on the market. Buyers must be able to envision themselves living there. Get your home into tip-top shape and ready to sell. Make the necessary repairs, clean and de-clutter. Buyers pay a premium for homes that are in move-in condition.