Ten Steps to Selling your Home in this Crazy Market.
You probably already know that real estate across most of the country
is not appreciating as fast as it was at one time. This isn't
necessarily a bad thing, unless of course you purchased last year and
are now selling. People who have owned a property for a few years are
generally well ahead in the game. We can't predict what 2012 will bring,
but so far, most markets have at least slowed, if not declined. For the
majority of established home owners in the prevailing market, prior
property appreciation will ensure at least some degree of profit, though
today's sales might not be as prosperous as they would have been in
2006. But all homeowners want to get the highest possible profits. How
do you go about this? There are 10 negotiating steps that a seller can
follow to assure that a person's home gets the best price and is sold
quickly.
Step 1: Use a broker from the local area. When the
market is down, so is the number of buyers. That means that you need to
expose your property to as many potential buyers as possible. Who do
prospective buyers get in touch with when they are house hunting? Real
estate brokers. National Association of Realtors statistics show that
85% of purchasers count on real estate brokers for their home
selections, while the Internet accounts for 80%. Who creates all of
those online real estate postings? Real estate brokers from the local
area.
Step 2: Familiarize yourself with the entire sale
agreement. Nearly all jurisdictions have standardized real estate
contract that has become lengthy and complex over many years. If you use
one of those, read it carefully and be aware that you are agreeing to
every unmodified term and condition. Make sure there is nothing in the
agreement that needs to be taken out, rewritten or added. The brokers
should offer a copy of the sale agreement that they might use at listing
presentations and the sale deed should be read to avoid
misunderstandings. As these are agreements on forms, whatever is not
stated as a requirement by the law can be changed by a cross-out or
addenda. Consult your attorney or broker for further detailed
information.
Step 3: Be completely familiar with the current
real estate market. For the sake of negotiations, knowing what the
recorded sale prices were isn't sufficient because often they don't give
the complete picture. As an example, two houses might have both sold
for $300,000. A person might have sold for $350,000 while the other for
$300,000 but the owner gave the buyer a 6 percent seller credit for a
new roof and appliances, which is $18,000. Local brokers who are
familiar with the details of recent sales are able to provide the best
negotiation advice.
Step 4: Understand all of the terms you
are willing to offer. You are confident that your home is going to sell
at some satisfactory price, but instead of starting out with an
inflexible amount, consider the property sale as a combination of price
and terms. For example, it might make more sense in a slow market to
help reduce the buyer's closing costs by offering a "seller contribution
"instead of lowering the price of the property. Often the seller
contribution could be significantly less than a reduction in price, and
buyers who require cash to close the sale could find it more attractive
as well.
Step 5: Request a smaller deposit. In order to bind a
legal contract, the buyer needs to make a deposit. In an ideal
marketplace, a seller will receive a large deposit, but in a down or
"off" market, a much smaller deposit may have to be accepted. The buyers
prefer to make the lowest possible deposit because a huge deposit
indicates a big financial and psychological commitment. You can ask for a
lower deposit if the buyer has mortgage pre-approval or if the buyer
shows a strong interest in the property and you have no other offers.
Step 6: Sweeten the pot. Are you really planning to take large items
like a swing set or washing machine? In certain cases it may be better
to leave such items if a buyer makes an offer.
Step 7: MLS
photos have to be updated. If your MLS photo shows snow around your home
in the middle of the summer, potential buyers will know your house has
been on the market a while. They may interpret this as meaning that you
might be desperate to sell and will expect to lower your initial offer.
Make sure your broker posts recent photographs.
Step 8: Fully
understand the marketing plan. The broker's marketing plan should be
reviewed quite often to see that it is being followed and is changed
whenever it is needed.
Step 9: Check out open houses. Going to
open houses, also known as your competition is a great idea. It isn't
always easy to be objective. However, do other owners have selling
ideas that might work in regards to your home? Is there something you
can use to bargain with? You could consider offering to do some painting
or other cosmetic repairs.
Step 10: Keep everything in context. Don't worry about nickels and dimes when your main goal is to get the house sold.
As an example, just before closing the deal, I had a buyer request an
extra $600 to resolve last minute concerns. That gesture seemed like
nothing more than a case of buyer's remorse, so I agreed to it, received
an otherwise ideal price, and closed the sale. It wasn't long before
the prices softened in the local market. It was better to lose $600 than
to find another buyer later when the market was harsher and the final
sale price might have been less by several thousands of dollars. Would
we have preferred to save that $600? Certainly. However, six hundred
dollars was a small price to pay considering that the delays could have
meant a big reduction in price.
