Home Selling Mistakes
10 Costly Home Selling Mistakes
Number 10 (in the countdown)- Don’t lose money holding onto a house that’s lost value.
If your house has lost value because home prices are depressed – don’t fret! You can still improve your position. Even if your Lake of the Ozarks real estate is worth less than your existing mortgage balance, you can still make out OK.
Consider this, if you’re house was worth $200,000 in 2008 and now is worth $180,000, you’ll have lost 10% of its value. If your mortgage balance is $190,000 then you’re traditionally considered ‘underwater’. But keep in mind that whether you sell your house or not, you’re still underwater (called ‘carrying negative equity’).
So when you’re looking for a new home, why not look at neighborhoods that have gone through the same reduction of value? Assume you find Lake of the Ozarks real estate selling for $250,000 now, that once sold for $277,700 in 2008, are you worse or better off buying that home?
Both houses will have lost 10% of their value, and as long as the house has the same potential to return to 2008 levels, you might as well sell yours for a loss to get into a home that is better for you. In either home you’re going to be hoping the value goes back to 2008 values.
If you find the right lender, you can move the $10,000 that you owe at closing into the mortgage of your new home. In the end, you’re likely still “underwater”, but wouldn’t you rather be underwater in a home you love? Holding on is one of the top home selling mistakes.
9. Don’t let your buyers know your motivation.
The reasons behind your decision to sell affect everything from setting a price to deciding how much time and money to invest in getting your home ready for sale. Except for your Realtor, don’t reveal your motivation to anyone else or they may use it against you at the negotiating table. When asked, simply say that your housing needs have changed.
Hinting at closing deadline desires, or willingness to give away too little too early will tell the buyer they have room to negotiate. You really want the buyer to feel like they need the house more than you. Once the buyer feels you need to sell it more than they need to buy it – that’s when you lose money.
8. Some people just use the wrong real estate agent
This is a tough market and to some degree your family’s financial health depends on the sale of your home. DON’T rely on friendships to sell your home, in fact, don’t let referrals sway you too much. If you’re getting a referral, it’s likely that the person doing the referring used the agent when times were good and it was easy to sell a home.
Today, that’s markedly different. You need an experienced real estate agent who is familiar with the ins and outs of today’s sale process. Banks and lenders have changed – you need someone who intimately understands that.
When working with a real estate agent, it’s critical that you have full confidence in that agent’s experience and education. A skilled, knowledgeable agent should be able to explain to you exactly why your home needs to be priced at a certain level. They need to be able to be painfully honest with you about the market.
Experienced agents also know exactly what the current pool of buyers are looking for in relation to particular styles and price ranges of properties. A skilled agent can recommend changes that will enhance the salability of your home, thus increasing the price – and/or decreasing the length of time before a sale.
This is no time to feel obligated to an existing relationship. Find out who is moving homes. With the internet, Craigslist, websites, videos and offline sales tools – there are tons of ways to market a home now besides realtor.com. People who are moving homes are likely using these new marketing tools.
Can you afford to have your house on the market for 6, 7 or 8 months just because your agent is a friend?
7. Make it easy for prospects to get information on your home.
You may be surprised to know that some marketing tools that most Realtors use to sell homes (eg. traditional open houses) are actually not very effective. In fact only 1% of homes are sold at an open house.
Furthermore, prospects looking for information on your home probably value their time as much as you do? The last thing they want to be subjected to is either a game of telephone tag, or an unwanted sales pitch. Make sure ads placed for your home have an address to an internet webpage for your home which gives buyers access to detailed information about your property day or night 7 days a week without having to talk to anyone!
Search YouTube for Lake of the Ozarks real estate? Who are the agents with these listings? If you found the listing, buyers will find them too. Check out that agents website – are their links to the videos? You need to make it very easy for buyers to learn all about your home before they even pick up the phone.
6. Taking for granted the “curb appeal” of your home
When you’re preparing your house for sale, remember the importance of first impressions. A buyer’s first impression can make or break whether they even want to go inside for a look. It is estimated that more than half of all houses are sold before the buyers even get out of their cars.
With that in mind, be sure to stand outside of your home and take a realistic “fresh look” and then ask yourself what can be done to make the “curb appeal” improve. Also ask your Realtor’s opinion as to how to improve the curb appeal. It could make a huge difference in your final sales price.
More than anything, people are using the internet when creating the list of homes they want to visit. If that curb appeal doesn’t come through on the photos – you’ll lose a lot of potential walk-throughs.
For that matter, if your listings are littered with beautiful pictures to “suck in” potential buyers – you may be losing out. On the flip side, your showings will be much more meaningful if the potential buyers have seen lots of photos and are already “pre-sold”.
5. Know your buyer. – Very Important!
In the negotiation / showing process, your objective is to control the pace and set the duration. What is your buyer’s motivation? Does he/she need to move quickly? Does he/she have enough money to pay you your asking price? Have they been pre-approved by a lender as to how much loan they can afford?
If the buyer isn’t pre-approved, make that a crucial and very important first step in the contract. Every day that your house is listed as “pending” is one more day that other buyers may be passing on even looking at it. Give the buyer just a few days to get pre-approved so you can move on with or without them confidently.
Also knowing this information gives you the upper hand in the negotiation because you know how far you can push to get what you want. If you are afraid to make a counter-offer because you just don’t understand your buyer – you may end up paying thousands more than you have to.
4. Forgetting what you would want to see if you were the buyer of your home
We recently had a Seller who was really “proud” of the colors he’d chosen for the walls and proud of the overall look. Unfortunately, he wasn’t the one who was going to live in the home long term.
Somehow you’ve got to disconnect yourself from the house and think about what a new buyer wants to see – not what you want to show them. Not only is the buyer more interested in how there stuff will look in the house – but they’re also going to want to see it in tip-top condition.
So don’t forget to sweep the front walkway, remove extra cars and trim the shrubs. Walk around and wash doorknobs, touch up the paint and clean the windows. This is common-knowledge stuff but you wouldn’t believe how many just disregard it.
You know they’re going to get a home inspector, which is one of the ways a buyer can get more money out of you. Remember that home inspectors are people too and have similar habits. If you walked into your teenager’s bedroom and clothes were everywhere, the doorknob was broken and the window was dirty – - wouldn’t it make you think there are likely other problems that need uncovered?
So to stop the snowball effect, make sure all your appliances are working, replace light bulbs, mow the lawn, clean the gutters, check the caulk in the bathroom and for heavens sakes pick up the laundry.
So back to the Seller who loved his colors. After 30 days on the market we convinced him to put tiny signs on the wall that said “This wall is painted Emerald Green (or whatever it was), if you have a favorite color we can have it professionally repainted before closing. 3 days later, he got a full price offer with the request that the trim in the kitchen be repainted. Tada!
