The first few weeks your home is on the market are the most important days of your selling experience. It is critical you capture the attention of the ‘real buyers’ in the marketplace (not the people who are toying with the idea of buying, but those who are invested with the dedicated purpose of purchasing a new home).
For those who are determined to buy a home, the process can be exhausting…because it is typically exhaustive. Buyers will spend endless hours pouring over listings, examining photographs, etc, in the hope of finding the ‘perfect home’. Most people who undertake the process in a serious manner will not want to waste their time looking at listings multiple times…they will make their initial list and then move on. You get one chance to make a good first impression…
You need to get your house under agreement in the first fifteen to thirty days. Why? Because after searching the initial supply of properties on the market, savvy Buyers filter future searches to include only those properties listed in the last fifteen to thirty days. Once your home is 16 or 31 days old, Sellers lose exposure to upwards of 2/3 of the Buyers in the marketplace. How do you get them back? You have to slash your listing price!
For the first week or so, time is the friend of the Seller; thereafter, it is the friend of the Buyer.
Here is the list of the top three mistakes being made by Sellers (the mistakes that prevent time from being their ally at the outset of the selling process):
Pricing: For the most part, all real estate agents use the same basic methodology for calculating the market value (the list price?) of a property. There is no need for anyone to reinvent the wheel. We review recently-sold properties (not ‘for sale’ properties), create baselines, then make needed adjustments based on the characteristics of the house, the quality of workmanship, etc. Market value has nothing to do with what a Seller paid for their property, how much money they spent on improvements, what the Seller’s emotional attachment is to the home (they were raised there…or raised their children there), etc…though the specific improvements will affect the value to varying degrees.
The problem is most Sellers select their realtor based largely on one item: how much will they list my property for?
But the real question should be: how much will they SELL my property for?
Not too long ago, I spoke with a real estate agent who told me his job was ‘to get listings’. He acknowledged telling people ‘what they want to hear’. He gets the listings. He waits. If he gets action on a listing, great… if not, after 40 or 50 days, he recommends a price reduction. He explained that once he has a listing he almost always has it until it sells.
But there are fewer potential buyers seeing the property at that point. The laws of economics dictate that less competition means a lower price.
Do not be tempted by the apple. If you interview three listing agents and two tell you the market value is $250,000 and the third tell you it’s $280,00…then understand the value is almost certainly in the vicinity of $250,000. Some of us will tell you what you need to know, not what you want to hear! Make your decision based on a plethora of other basis: how well your personality matches up with the agent’s personality; how hard the agent will work to make your priorities their priorities; will they be available when you need them; their communication skills and style (will they respond to queries promptly and supply all of the information you need when you need it); whether they will invest time in hosting broker and/or public open houses; etc.
In a Seller’s market you should be able to get your house under agreement within the first 30 days (unless there are one or more issues affecting the property that pose difficulties… ie, the house is in a bad location or it is in disrepair; there is water in the basement or arsenic in the water; etc). If the property is priced properly, and if it is marketed properly (ie, open houses), it is possible (even, likely) you will receive full-list-price and over-list-price offers.
Imagine you are a Buyer. You attend an open house the weekend after the house is listed. It is a nice property in a great location…and it is priced right where it should be. Yes, maybe there are a couple of small things you’d like to change, but there is no such thing as a perfect house. This house is a LOT nicer than the other houses you have looked at. There is a sign-in sheet…you sign in and provide your e-mail address (because you want to get updates on the house) and you note there are seven other people who have signed in. And there are two other couples in the house right now.
You start to wonder: how many other people are going to make an offer? How much are they going to offer? The house is very nice…the nicest house in town at this price. You feel certain other buyers are going to make an offer…maybe several other buyers. But how much are they going to offer? You do NOT want to lose this house to someone else…especially not over a thousand dollars. Or two…
Someone else is going to offer a couple thousand over list price. Or maybe the other couple is thinking the same way, so they start to believe they need to offer FIVE thousand over list price!! So the first couple decides to offer SEVEN thousand over list price! Okay, we will offer $257,000 for the house that is listed at $250,000.
Meanwhile, if the house had been listed at $275,000, it is quite possible no one would have attended that open house… they attended the open house being held two streets over… at the house that was listed for $250,000 – right where it was supposed to be listed!
Sellers, do you see all of those houses that are currently for sale and that have been on the market for 30+ days? Keep an eye on them and watch how many of them will have a price reduction or two (or more) before they eventually sell.
They are “chasing the market” because they let their realtor set the wrong benchmark at the outset.
Bad pricing is the Number One reason houses do not sell!
Poor Listing: I don’t want to ‘list’ your home, I want to ‘SELL’ your home. My top priority is to get Buyers into your home and get an offer from them… or get multiple offers from multiple Buyers. My responsibility is to do whatever it takes to make that happen. The primary mechanism for doing that is setting a suitable list price.
The second means I use to get Buyers into your home is to present the public with a professional listing. Well-written. Inviting! A description that stresses the strengths of the property in a way that Buyers imagine themselves living there (and that makes them want to see the property in-person to assess whether the house ‘feels right’).
The listing should be supported by numerous quality pictures. How often do you see a listing with poor pictures? Far too often, right? The listing only has ten pictures, and five of them are of the exterior of the building. The five pictures of the interior may only show three rooms…or the pictures are taken in such a way they only show half of the room (the picture is cropped, or the dominant feature in the pictures is the ceiling). [NOTE: A listing I viewed today in Concord, NH, has nine pictures (four are of the exterior) and all of the pictures are approximately one inch by one-and-a-half inch in size. Who can see the details of the kitchen or living room in a picture that is THAT small? How can that Seller be happy… how can the Seller feel properly represented by such a haphazard effort?]
If you entrust an agent with the sale of your home, it is the realtor’s responsibility to invest an hour or two into taking high-quality pictures. Interior and exterior features. All rooms. Basement. Garage. Everything! Care should be taken to show the entire room, not just half the room…and to show the living space, not the ceiling.
You sell homes by getting people INTO the home. You cannot get people into a home if the house is over-priced, or if the listing is poorly written with insufficient, uninviting pictures.
Presentation: The third primary reason your property might linger (unsold) on the market is presentation.
There is no ‘curb appeal’…the exterior of the home is cluttered, shrubs are overgrown, the lawn needs watering.
Inside the house, the rooms are suffocating: there are too many items on the wall, too many pieces of furniture in some of the rooms, and too much “stuff” on every counter and surface. Buyers enter the house and feel like they cannot breathe. (Or, conversely, the house is vacant and there is nothing in the house…this can make it very difficult for Buyers to imagine living there).[Take half the items off your walls, remove the nails/hangers, and patch the holes. Grab some boxes and remove the clutter from your counter tops, desk tops and bureaus, etc). Take the extra furniture (chairs, side tables, etc) and put them in the garage while you have the house listed]
The house is in need of multiple repairs. There is a drip under the kitchen sink. There is a hole in one of the hollow-core, six-panel closet doors. The screens on two windows and the slider have holes or tears in them. The seals for the glass in two windows have been compromised. Both bathroom tubs are badly stained and are particularly unappealing. Two of the rooms need to be re-painted. Lots of nice homes remain unsold because many (most?) Buyers do not want to have to take care of maintenance items the Seller should have addressed on an on-going basis.[The leak can be repaired with a washer. A new hollow-core, six-panel door is $50 at Home Depot and can be installed in fifteen minutes. The screens can be repaired for less than $100 at a local hardware store. The glass in the two windows can be replaced for $75 each by a glass company. The tubs can be re-surfaced by Miracle Method (or a similar company) for $750-$800. Paint is $35/gallon.]
These changes and investments can help alter the presentation of your home and help you put your best foot forward.
Need further advice? Call me… remember, I’m not interested in listing your home for you, I will SELL it.