Contributed post by Samantha Garbett
Real estate isn’t only about buying a new home; it’s also about selling.
Investors will have properties which they want to offload as quickly as possible. Homeowners need to sell up so that they can move into a new pad. Striking a deal which suits both parties is part and parcel of the job. However, the price is a major sticking point.
You want as much money as possible whereas they want to maintain a healthy budget.
Therefore, figuring out how much you will accept is one of the most important factors. Without a solid valuation, there is no way the property is going to sell.
As simple as the process sounds, it’s a rather tricky balance because there is a dilemma.
Overvalue it and there’s a good chance no one will bid, but undervalue and you’ll leave money on the table. Even worse is the fact that interest begins to wane after three weeks according to thebalance.com. If there isn’t a sale within those twenty-one days, it can be hard to find a buyer.
Pricing is an art, and you have to understand it before you can get any good. Here are the basics to help in your time of need.
Realtor X 2
People will read this and not understand the fuss.
Isn’t it the realtor’s job to come up with a price? The answer is yes, and he or she may do a fantastic job. Still, it’s not wise to leave such as huge part of the selling process in one person’s hands. What if they lose concentration and make a mistake? Or, what if they do it on purpose?
Some agents have been known to overprice properties in the hope it boosts their commission.
To avoid nasty surprises, it’s best to use more than one realtor in the beginning. By doing this, you can contrast and compare the result.
So, if there are anomalies, it will be easy to spot in the price. The contrast will be huge.
What you are looking for are agents which estimate the value to be around about the same amount. Of course, allow for some degree of difficulty because it isn’t an exact science.
Choose the one which goes the extra mile. Some shoot from the hip because they are old-school and are experienced. Others will draw up a market analysis sheet and show you how they came to a decision.
Analytic people should pick the latter over the former.
Don’t let the realtor do all of the heavy-lifting.
Be proactive and show your own working with a comparative analysis of nearby listings. In plain English, this means you should collect info on the latest house sales within a short radius. That way, you can use the data to compare and contrast and to find a perfect number.
In the beginning, there should be a handful of properties on your radar, and then you can start crossing them off the list.
What are the criteria?
Well, they change depending on the situation. However, a general rule is not to use listings which are older than three months.
Not to judge, but these appear to have done something wrong or else they would have sold.
Ninety days is too long to wait and is well out of the three-week window. Another to bear in mind is the distance. Anything outside of a half of a mile is too far.
Usually, there is plenty of properties close-by available for comparison without going into the sticks. Rural homes will need to lengthen the distance.
The basic trick is to make sure you are comparing similar features. Factor in the age of the building, for example. Some people will pay more for a 1950s building as opposed to a new-build. Perception is another thing to remember. Houses can look the same yet cost more because buyers fall in love.
A Done Deal
The original asking price and the amount it sells for are two different things.
Although stereotypes aren’t helpful, there are hardly any properties which break even. That is to say, price reductions usually happen to push through a sale faster.
However, you have the dilemma of leaving money on the table again. Accept a low offer and you’ll lose out while the buyer gets a bargain.
To avoid this, the selling party should check out the comp sales.
These are the homes which are part of the comparative analysis that sold. What was the final amount? How big was the reduction? Hopefully, the answer will be “not very great” because it will stand you in good stead for the future. Realistically, it’s bound to be somewhere in the region of $5,000 to $10,000.
Of course, you should adjust the total based on upgrades and the state of the market.
Houses with added extras can sell for more because they have value. But, the market may force you to be flexible. At the moment, the economy means people aren’t buying, which suggests they have the leverage.
The supply is high yet the demand is low, so the ball is in their court.
The Time Factor
Some people can afford to wait for a better offer while others have to move quickly.
Which category you fall into is important as it opens up different doors. The former aren’t pressed for time, which implies they can go the traditional route.
No one wants to wait months to sell-up yet they can trade blows to secure a great deal. The movers and shakers are on a parallel path.
Time waits for no person, and if you don’t do a deal quickly then the future may look bleak.
Thankfully, there are shortcuts which can come in handy.
A cash offer is a perfect example. Without the need to deal with a lender, there is less red tape and the deal should go through without a hitch. Regular buyers don’t have tens of thousands of dollars lying around the house, but companies do. WrenRealtyInc.com is popular because their people tend to close within two weeks.
Whatever happens, you shouldn’t cut corners.
There is a difference between that and a shortcut. Do the things that are essential to ensure there is no funny business even if they are protracted. Otherwise, a lack of thoroughness may bite you in the ass down the line.
Withdrawn Or Expired
Sellers won’t leave a listing on the market forever.
When there isn’t any interest, it’s clear no one will place a bid, so they take it down and leave it for a while. Then, after they have been withdrawn or have expired, they put them up again.
You may think this is a false hope yet the market is fickle. One minute buyers hate a property and the next they are in love.
You can learn a lot about the properties which withdraw from the market or expire.
For one thing, the price will give you an insight into what is acceptable. There are many reasons listings fail, but the value is a major sticking point. Did the homeowners appear to overvalue the lot? If so, by how much and why? It’s tricky to second guess a person without listening to their explanation but you can get into their mind.
After all, you’re doing the same thing for the same reasons.
As well as the value, think about the stuff which may have turned off buyers. Which company did they use? Sometimes, agents will sell everything they touch because they are skilled and experienced. However, there are budget realtors that aren’t as prolific because they don’t spend the money on marketing.
Write down the common features of failure and use them to avoid doing the same with your property.
Probably the biggest home buying mistake you can make is to think it’s a personal journey.
It is in terms of how you think and feel. No one can tell a seller to act a certain way because it’s down to the individual.
Concerning other people involved in the process, you are by no means alone. Reneecatricala.com likes to point out that there is competition and you have to stand out from the crowd. Otherwise, the price will make no difference whatsoever.
The real estate industry has become a digital domain.
Viewing properties is done online to save time and energy. However, there is no substitute for being in the house in person. That way, you can get a feel for why it is a better or worse property. And, this process is essential as it impacts the final valuation.
Active listings with desirable features such as a garage and a garden will cost more than those without.
What you can try and do is to recreate the same experience in your home.
Be realistic though because it can be tricky and expensive. Attempt to copy the things which make you feel good, such as the color scheme or openness of the property.
As a seller, you need to give your property the best chance of grabbing a buyer’s attention. Is this the case at the moment?
Photo credits which require attribution
For Sale photo By: Staff Sgt. Teresa J. Cleveland