The search for a new home -and subsequent sale of your own- often comes with some sort of time constraint. If you’re buying a new development, you may know going in how long you have to sell your home. In other cases, the timelines can be a bit more dynamic and require some flexibility. Regardless of the situation, there’s one thing sellers can’t stand, and that’s watching their home sit on the market for ages.
Houses that don’t sell can create a lot of problems. On top of the undue stress it brings, it can also create financial hardships through the need for bridge financing, penalties incurred for missed deadlines, multiple mortgage payments, etc. Sometimes a house sitting on the market isn’t the end of the world for a seller. Sometimes it really hurts. Either way, it’s understandably frustrating for everyone when a house sits around without any action on it.
The following article gives a little insight to avoiding the traditional problems with selling your home. Primarily, the one where the seller tends to value it for more than it’s worth, but the buyer wants to feel like they got a great deal. Enjoy reading, and remember to contact Planet Realty if you have any questions! Have a great weekend!
Price Your House to Sell Quickly
Dian Hymer, Inman News, August 20, 2012
If home lacks features of recent comps, it’s time to subtract value
A first-quarter survey of homebuyers and sellers done by HomeGain.com, a real estate services website, revealed that 76 percent of homeowners believe their home is worth more than the list price recommended by their real estate agent.
Homebuyers usually have a better grasp of current market value in the area where they’re looking to buy than do sellers who own and live there. Buyers look at a lot of new listings. They make offers, know what sells quickly and for how much, and what doesn’t and why. HomeGain reported that homebuyers still think sellers are overpricing their homes.
Your home is worth what a buyer will pay for it given current market conditions. This may not be the same as your opinion of what your home will sell for, or what you hope it’s worth. Relying on emotion rather than logic when selecting a list price can lead to disappointing results.
The prime opportunity for selling a home is when it’s new on the market. This is when it is most marketable. Buyers wait for the new listings. Usually, listings receive the most showings and have the busiest open houses during the first couple of weeks they are on the market.
This is the opportunity to show your house off to advantage with a list price that attracts buyers’ attention. Listings that sell today are priced right for the market. Buyers need to feel comfortable that they are getting a good deal.
Buyers won’t overpay if they feel home prices are still declining, and in some areas of the country, they still are. In areas of strong sales, buyers may shy away from multiple-offer situations if they feel the recovery is fragile and that prices may slide further before stabilizing. Even in areas where home sales have been strong in the first half of 2012, local practitioners wonder how long the uptick will last.
HOUSE HUNTING TIP: When selecting a list price, it helps to understand how real estate agents and appraisers establish an expected selling price or price range for your home. They research the recent listing inventory for homes similar to yours that sold. The most recent sales give the best indication of the direction of the market.
They analyze these comparable sales giving more value to your home for attributes that it has that the comparables don’t, like a remodeled kitchen. Value is subtracted from your home for features it lacks when compared to the sold comparables, like an easily accessible, level backyard.
It’s difficult for sellers to step back and take an attitude of detached interest in their home. But it’s essential to do so if you want to sell successfully in this market. For example, your home could actually sell for less, not more, than a comparable sale because you added a swimming pool in an area where most homebuyers would rather have a yard with a generous lawn.
If the comparable sale information suggests that the value of homes like yours is declining, select a list price that undercuts the competition to drive buyers — and hopefully offers — to your home. You can take a more aggressive stance on pricing if the comparables show that prices are moving up.
If there is high demand for homes like yours, you may receive more than one offer. But don’t list too high. It’s better to stay in the range shown by the comparables and expose the house to the market before accepting offers. The market will drive the price up if it’s warranted.
THE CLOSING: Don’t rely on rumors circulating in the neighborhood about how high a home sold. Prices tend to get inflated when passed from one person to another. Select your list price based on hard facts.