Placing a home on the market for the first time takes preparation and realistic expectations.
Crystal Akers, a Realtor with Berkshire Hathaway HomeServices Hodnett Cooper Real Estate, said there are many things that can affect the time it takes to sell a home and the ultimate price it will sell for.
“Competitively pricing your home is crucial,” Akers said. “When a home is priced incorrectly it will become stale in the marketplace.”
Listing high and holding out for an offer is not the best practice, she said.
Homeowners often consider the non-monetary value of their homes, which makes a “realistic snapshot” tricky.
“The biggest factor in misjudging the value of someone’s home is what we like to call the ‘upgrade factor,’” she said. “Whether it’s a brand new kitchen remodel or crown molding, homeowners know exactly what they’ve upgraded in the house and automatically calculate that into their estimation. Unfortunately, they don’t realize that other comparable homes already have similar qualities, or even better qualities, and they overestimate the value added.”
In addition to the upgrade factor, homeowners often base their estimations on the price they paid for the home. But Akers said the market is constantly changing.
“The home might be worth more than they initially paid, or, in some cases the home may be worth less than they initially paid,” she said.
For those tempted to sell a home without the help of a real estate broker, it’s a mistake, she said.
“Acting as your own agent is a ginormous risk,” Akers said. “While tempting, the risk of going it alone to save money likely outweighs the benefits of using a local Realtor who has experience and expertise to navigate all legal and regulatory requirements that come with selling a home.”
Realtor Roland Daniel, owner of Roland Daniel Properties, said selling a home isn’t for most people.
“Hire a Realtor, a person trained in marketing and selling homes,” he said. “Choose an agent with a good reputation. Choose a full-time agent. Don’t hire your ‘friend who has a license’ that’s in your coffee club.”
Daniel said most people know the real value of their home but many ignore reality and insist the property be listed higher than the market can bear.
“Most of the activity a home will receive will be in the first 30 to 45 days of any listing period,” he said. “Why waste that critical time with a price too high? A home should always be priced to sell within three to six months. Remember this: a home is worth what the market will pay for it; not necessarily ‘what I need for what I want to do next.’ That’s a big mistake.”
Another mistake is the failure to disclose hidden problems. Disclosure helps price the property correctly and give notice to buyers, Daniel said.
“If you hide something and it’s discovered during a buyer’s home inspection, then you as a seller have lost credibility and likely a sale to that particular buyer,” he said.
Full disclosure protects both sides during a real estate transaction, Akers said.
“If, after all, there’s a problem with your home that the buyer wasn’t told about, the buyer could get angry and try to sue you after the closing,” Akers said. “Lawyers who deal with residential real estate transactions widely report that the most common source of lawsuits is nondisclosure.”
Providing disclosures doesn’t mean a seller is giving a buyer guarantees but the information protects the seller from future liability problems.
There are also other preparations all sellers have to make before putting a home on the market, including eliminating clutter and taking care of all the cleaning and cosmetic improvements to make the house market-ready.
Owners should resist the temptation of being in the home when it is shown by a Realtor.
“The main reason is that buyers should be able to freely remark about a property to the professionals working the sale,” Daniel said. “Owners on site typically ‘help too much’ or are offended by comments. Bad idea.”
Another deterrent to selling a home is evidence of a pet.
“Pets have accidents; and while it is possible to get used to the pet smell over time, new visitors to your home will be sure to notice the smells,” Akers said. “This is not something you want to happen. In fact, above all else, this may be an important tip for selling a home when you have pets.”
Akers said a strong pet odor is one of the top reasons a buyer will pass on a home.
“Avoid this by having your carpet and flooring professionally cleaned, with a focus on removing pet odors,” she said. “If the staining or odors are too bad, you may need to replace the carpet in the problem areas.”
Many housing markets have a low inventory and a lot of competition among buyers, so in many instances there are multiple offers for a specific house. Akers and Daniel both recommend a pre-approval letter showing the buyer’s ability to get financing.
“If you put yourself in the seller’s shoes and look at two identical offers, one with a pre-approval letter and one without, you would certainly lean toward the person who was already considering their financing options by getting a pre-approval letter,” Akers said. “Also, having a letter from a respected lender might also beat out a vague letter from a less-recognizable institution. There’s something to be said for a formal letter from a strong brand.”