Andrew And Associates

Selling Your Own Home?
Ten Mistakes You Could Make…

And How to Avoid Them

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Mistake #1: Improperly Pricing Your Home

The majority of “For Sale by Owner” (FSBO) homes are either priced too high or too low.

Pricing your home too high may increase the time your home spends on the market. The longer your property sits on the market, the less marketable it becomes. In fact, buyers begin to wonder if something is wrong with it.

About a year ago, my wife and I were going to sell our own home.  We had set a price, bought a sign, and signed up with a “for sale by owner” company on the Internet.  Then, we decided to tell a friend of ours (who was a realtor) that if he brought us a buyer, we would pay him a commission.  When he saw our asking price, he said it was too low.  Long story made short; we listed with him and sold our home in two weeks for $35,000 over our original asking price.

Properly pricing your home is perhaps the most crucial factor in making a sale. You can’t just decide that you need a certain amount of money, so that is the price you will ask for your home… or because your neighbor just sold his house for a certain amount, that is what your home will sell for also. Buyers determine the value. They’ll compare your home and your asking price to similar homes on the market. If your price doesn’t stack up, they may reject it and move on to the next listing.

To avoid over-pricing or under-pricing your home, you need to have an experienced real estate professional prepare a Comparative Market Analysis (CMA) report for your home. This report provides details on recent sales of homes similar to yours, as well as the asking price of homes currently on the market. Your agent will then balance that information with other factors such as location, condition of your home, special interior or landscaping features, age of the house, and your time frame to determine a fair and competitive asking price.

I never charge for a CMA. Upon request, I provide a Free Comparative Market Analysis as a service to anyone selling his or her home.

Mistake #2: Not Preparing Your Home for Maximum Impact and Value

There’s an old saying, “You Never Have A Second Chance to Make a First Impression”. This is absolutely true when selling your home.  You won’t sell your house quickly if you continue to live your normal life while showing it.  Potential buyers don’t want to see drippy faucets, toys scattered on the floor, dinner dishes in the sink, cluttered closets, your personal photos, or muddy shoes on the front porch. Buyers tend to judge homes by cost and “move-in” condition.  The less they have to do to move in, the better your chance for a sale…and the more they may be willing to pay.

Here are a few tips to help you prepare your home for potential buyers:

• Clear away any debris or clutter from the front door - inside and outside - to make the entry to your home seem more spacious and allow freedom of movement for more than one person.
   
• Open windows daily for a few minutes to eliminate stale air and/or cooking odors and mildew/moisture from hot showers and laundry.
   
• Polish the front door knob, clean the storm door and sweep the front steps.
   
• Remove excess furniture that clutters a room to make your home feel more spacious.  You’re going to move anyway, so start packing up things that clutter your house.
   
• In areas that need painting, keep colors neutral and light - white, beige and gray are the most popular exterior colors, while shades of white, off white and very light pastels are the safest choices for the interior.
   
• Place a vase of fresh flowers in a bathroom and place all personal care articles out of sight.
   
• Organize cabinets and closets to demonstrate how much room you have.
   
• Open dark drapes and blinds to lighten and brighten rooms.

 Have a real estate professional tour your home.  He/she can help you see your home through a buyer’s eyes and suggest simple ways to arrange each room for maximum impact.

I provide this service Free to anyone selling his or her home in our marketing area.
 

Mistake #3: Not Maximizing Your Exposure in the Marketplace

If you buy a “For Sale By Owner” sign and stick it in your yard, then sit back and wait for the offers to roll in, you may wait a long time.  The more exposure you have, the better your chances of finding the person who wants to buy your home.  Classified ads and open houses will expand your reach to a degree. The more contacts and people you can network with, the more likely you are to sell your home.

Since many sales involve out-of-town buyers, marketing a home requires extensive connections and a strategic marketing plan. If you want to sell your home in a reasonable length of time, you should have it listed in the multiple listing service (MLS), which is only open to licensed real estate agents.

CENTURY 21® home sales specialists have access to state-of-the-art technology tools to share referrals across a global network. These agents will spend time behind the scenes helping you target serious buyers and make the best of your prime selling period.

I’d be glad to share with you our “Sixteen Step Comprehensive Marketing Plan”.
 

Mistake #4: Failure to Pre-screen Prospective Buyers

As a person selling your own home, you don’t have the tools on hand to pre-qualify buyers. You may assume that if someone is looking at your home, they can afford to buy it.  You may also assume that they are a serious buyer.  So, you get a phone call and make an appointment.  You rush to clean up the house.  They show up, tour the house, say thank you, then you never hear from them again. You made all that effort for nothing.

Even worse… you find someone who is interested in buying your home. They make an offer on your home and you think you’ve got a sale. You take your home off the market and then learn two weeks later they didn’t get the loan they thought they would. Now, you start all over.

To avoid this hassle, you need a professional real estate agent to represent you.  He/she will pre-qualify the potential buyer, so only people who can afford to buy are entering your home.  You clean the house only when a serious buyer is coming. 
 

Mistake #5: Not Totally Understanding Buyer Concerns

Buyers are often hesitant to contact homeowners for at least two reasons:

First, they don’t want to intrude on you. They don’t know you. They feel uneasy about taking your time just to look. Courteous buyers don’t want to say or do anything that might offend you. Potential buyers might also be intimidated looking through a home if the owner is present. Most potential buyers want to tour your home and feel free to comment on what they might do if they bought the home. This usually won’t happen if the owner is showing the home.

Second, buyers often feel uncomfortable making an offer if they know they’ll be negotiating directly with the owner. Again, they don’t want to say something that you might not want to hear.

Buyers appreciate the accessibility and objectivity of a respected real estate professional. They can speak their mind without offending you, the seller. But, even more important, the seller’s agent will be negotiating on your behalf, looking out for your best interest. Negotiating a “deal” requires a lot of effort and work, if it’s done right.

Mistake #6: Not Guarding Against Costly Legal Mistakes

We live in a crazy world. Too many people have the mindset of “I’ll see you in court”. In today’s litigious society it becomes imperative that all matters relating to the sale of the property, i.e. physical conditions, history, zoning, etc., be accurately and comprehensively disclosed.

Many forms and disclosures have been developed to meet both federal and state laws concerning real estate. Overlooking even one form or required disclosure may lead to an expensive claim. You need peace of mind, so that when your home is sold, your liability is over. A knowledgeable and reputable real estate professional can assist you with these issues and avoid many potential problems, even after the sale of your home.

Mistake #7: Insufficient Knowledge of Sales Agreements

There are at least two principles about sales agreements that sellers should understand if they are to successfully sell their home.

First, they need to know what information should be included in the sales agreement. At a minimum, the sales agreement should include the following information:

• The complete legal names of both the Sellers and the Buyers.
• The amount of earnest money to be deposited and how that will be handled. For example, if the buyer fails to get the loan, what will happen with the earnest money?
• The loan application and fee deadline date for the buyer.
• The Seller Disclosure deadline. The seller must complete a comprehensive checklist on the condition of their home and make this available to the buyer.
• The Evaluation and Inspection deadline date. Buyers have the right to evaluate and inspect your home. This could include a home inspection, a termite inspection or a walk through by the buyers and their designated representatives.
• The loan denial deadline date. This is the date that the buyers must have their loan completely approved. You should include what will happen if the buyer loan is denied.
• The Appraisal deadline date. All lenders require an appraisal to be done on a home before a loan is approved. You need to know the date that will be completed. You also need to clarify what will happen if your home appraises for much more or much less than the sales price.
• The Settlement Deadline date. This is the date when the sellers and buyers will sign all the legal papers so that the sale of the home may be funded by the lender. You need to be very clear on who will pay what charges at the settlement. Settlement costs will include taxes, title insurance, mortgage insurance, down payment, closing costs, etc.
• How will you handle changes during the transaction? This defines how offers and counter offers can be made until a final acceptance is reached.

The second area is referred to as contingencies. A contingent sale is where a buyer offers to buy your home but must first sell his or her own home. You don’t want to lose the buyer, but you also don’t want to take your home off the market. The best solution is to offer the buyer a 72 Hour First Right of Refusal. This simply means that if you, the seller, receive another offer on your home, the first buyer has 72 hours to come up with the funds or the sale is cancelled.

As a professional realtor, I strongly recommend you use the state approved Real Estate Purchase Contract. When this contract is properly used, it provides specific guidelines to insure a smooth transition while limiting your legal liabilities.

Upon request, I will provide you a Free copy of the Real Estate Purchase Contract.

Mistake #8: Failing to Ensure Safety, Confidentiality and Privacy,
of Both Sellers and Buyers

These days, you don’t want just anyone knocking on your door and touring your home. A “For Sale by Owner” sign is an invitation for anyone to ask to see your home. In today’s society you must be very careful. There have been many instances where thieves have posed as prospective buyers. Their intent is to learn what might be of value in your home, how they might gain access or when you may not be at home.

You should always have at least two family members present when showing your home. Never explain the details about your alarm system, work schedule or family habits. Always go room to room with the prospective buyer. If more than one buyer comes, have them stay together or be sure someone accompanies each buyer. NEVER allow anyone to go off alone in your home.

Be sure to protect your credit cards and valuables. Put them away where no one can see or take them. Be sure your jewelry, keys and other valuables are well hidden.

Using a professional real estate agent can reduce a lot of stress and eliminate many unknown factors. The agent will accompany the buyers as they tour your home. Your home will be protected. You will be protected.

Mistake #9: Failure to Negotiate for Top Dollar

Reaching an agreement between seller and buyer and then closing the deal requires complete objectivity and a thorough understanding of deeds, abstracts, offers, contingencies, disclosures, title searches, etc.

The buyer desires to negotiate with the seller to save money. The seller is willing to negotiate to close the deal and move. However, what usually happens is the buyer offers a lower price than the seller wants to accept.  The seller doesn’t want to lose the sale, so he/she accepts a lower price. In addition to selling the home at a lower price, the seller may end up paying for services and costs that are normally paid by the buyer or real estate agent. In short, the owner looses.

The only way to avoid this mistake is to price your home at the market value and hold firm on your decision.

When you have a skilled negotiator on your side, dedicated to looking after your best interest, you are more likely to sell your home at a price that maximizes your value and brings you peace of mind.
 

Mistake #10: Offering Concessions in Place of Repairs

Almost every home has some trouble spots. For example, the carpet may need to be cleaned, fixtures need to be replaced, walls or baseboards need to be painted, etc. Most buyers will ask for concessions to lower the cost. As the owner, it is much cheaper and cost effective to fix or replace these items yourself. You will get more money for your home and you will sell it in less time.

Do you have questions or need advice you can count on or just want to discuss this further?

Don’t waste any more time; pick up the phone and call me now!  I’m here to help!

I offer a five star guarantee. I appreciate your business, loyalty, trust and referrals. My goal is to provide the very best counsel and advice to meet your real estate needs. If I can assist you, a relative, friend or co-worker, please give me a call. I look forward to the opportunity to serve you.

For prompt, courteous, professional service, call Larry Andrew: