Ann & John were recently asked to put together a presentation for people contemplating the sale of their home. Here are a few quick questions they generated in order to spark an interactive conversation about the selling process. We are happy to expand on any of these talking points, as we do in our presentation.
TEN thoughts to ponder if you are thinking about selling your residential property:
- “What are the basic steps involved in selling a house?”
We feel there are three BASIC phases of the real estate sales process:
- Preparation – begin planning early
- Marketing – strategies for getting buyers
- Contract to Closing – you have a buyer, what next?
- “I am considering putting my house up “for sale” and want to know, when is the best time for me to engage my realtor?”
- If you are thinking about selling your house, then it’s time to call your agent.
- Involve your Realtor ASAP; they have the knowledge and experience to guide you intelligently from the very beginning.
- Start early; give yourself plenty of time to get the house ready to sell; it may take longer to get the house “market ready” than you think.
- Realtors can see past the present condition of a house, and provide powerful suggestions that will get you started productively. Don’t wait until you “think” you’re ready before calling.
- IF you haven’t yet selected a Realtor, start even sooner!
- “You’re a Realtor, how much is my house worth in today’s market; you have this information at your fingertips, right?”
- Realtors can quickly gather information in order to give you an overall idea about what houses in your area/neighborhood are selling for at a particular time, BUT an accurate CMA (Comparative Market Analysis) of your particular home will require deliberate research – no two homes are exactly alike.
- An agent will NOT likely be able to guide you in pricing you house until they know how it is going to “show” while it’s on the market. They can see past pre-market conditions, so invite them into the house soon.
- Your Realtor will prepare a professional market analysis of the property, allowing you to make an informed decision about where to set the sales price.
- Your Realtor will help you understand the difference between “market value”, “appraised value”, “tax assessment”, and “AVM” estimates.
- Realtors do not set sales price, you do; they provide accurate information on order for you to make informed decisions about your property.
- “What Three Things sell a house? location, location, location of course!”
- Location, Price and Condition are the three key factors you need to consider when selling a home. PRICE is absolutely the product of location and condition, but the only thing you cannot change is the location.
- “I know purchasers are likely to offer me less than my asking price, shouldn’t I build-in a cushion in order to get what I want for my house?”
- Homes typically sell within 97% of the list price, but 47% report reducing the asking price at least once.
- Overpricing or building in a “price-cushion” does not benefit the seller; price the home competitively, at or near when you believe it will sell, and it will generate more offers at a higher price, and in a shorter period of time.
- Homes that are priced well sell quickly, sell at or near list price, and are more likely to generate multiple offers.
- Consider a “compelling price”, one in which a purchaser knows that if they do not make a strong purchase offer the house will not be there for them later.
- Unless purchasing an investment property, in our area of Richmond, VA, purchasers are more likely NOT to make a purchase offer if they perceive the sales price as being unrealistic or overpriced for the market.
- “Why should I spend time and money sprucing up the exterior of my house when I know it is the interior that’s really going to sell it?”
- Your first impression to a purchaser is the most important.
- You cannot sell your house if a purchaser will not get out of the car and come inside.
- Dollar for dollar, the biggest return on your investment is in your yard and landscaping, but don’t overdo it for the neighborhood.
- Cost VS Value.com Report is an excellent resource when attempting to understand the dollar return on repairs and upgrades to a property.
- Think “Consistency” when understanding what sells.
- “We haven’t painted the inside of the house in ten years, but it’s not all that bad, really; why spend money on something that a purchaser is likely to change anyway?”
- YES! Because paint is worth $30 dollars in the can, and worth $3,000 dollars on the wall!
- Consider things like painting, or replacing worn out carpets, or changing out dated fixtures or appliances to improve your appearance.
- You don’t need to “renovate”, but fixing the obvious objections will save you time and money in the long run.
- Ignoring the simple fixes will be reflected in the days on market, as well as the final sales price.
- Understand that your house is no longer your “home”; it is best if you can look at your property as a “consumer product” for which you seek to get the highest price, in the shortest period of time, with the least inconvenience to you and your family.
- “Our furnishings are just fine, why do we need to worry about staging the house; they’re not buying the furniture, are they?”
- There are misconceptions about what “staging” is, and what it costs.
- Setting the stage in your house is critical to improving your bottom line. It doesn’t necessarily mean changing everything in the house.
- There are different levels of staging depending on each seller’s need.
- Staging doesn’t need to cost the seller a lot of money.
ADVANTAGES to setting the “Stage”:
- It’s easier for buyers to visualize their future home if they see themselves in that environment; if the can mentally “move-in” to the property.
- Buyers are willing to spend more time in the house if they are comfortable and inspired.
- Buyers tend to overlook other property shortcomings when emotionally stimulated.
- The 3 most important rooms to consider: Kitchen, Living Room, Master Bedroom are the most important rooms to stage – followed by baths.
- “Who has the advantage in today’s Real Estate Market, Buyers or Sellers?”
- The housing marketplace is a pendulum that is constantly moving.
- The advantage may not be as it appears, and may vary with location.
- Lower inventory is available for sale
- Prices are slowly improving, but each market area varies
- Interest rates remain low, but are expected to increase slightly
- Fewer buyers in the market. People appear to be content. Consumer confidence is slowing improving
- Purchasers are taking time to evaluate their options – no sense of urgency
- Purchasers are still looking for the diamond and the deal
- Purchaser’s expectations are high
- “The last time we bought or sold a home was ten years ago, things haven’t really changed all that much, have they?”
- Change is constant; the real estate and lending markets have changed drastically since 2008.
- The average time a home owner stays in their current home ranges from 5-9 years according to the National Association of Realtors (up from 3-5 years during pre-bust market conditions)
- Chances are, if you have not bought or sold a home in the last five to seven years, then you can expect a very different experience.
- Your Realtor can provide a complete guide to the Selling process today.
- Changes have also influenced Home Inspections, Appraisals, The Lending Process
- Written Disclosures as of July First, 2012
Based on what the experts are saying, what can we expect to the in the coming year? Although we won’t know until the end of the year if these predictions are true, here’s what the experts predict for 2015: (National predictions listed on the NAR website)
- Prices Will Increase – existing home prices will increase 3% in 2015, and 2% in 2016. (Bloomberg Businessweek)
- Mortgage Rates May Increase – 30 year fixed mortgage rates are expected to increase in 2015, but will still be considered low (NAR) – [The 1% to 10% affordability rule]
- Homes Will Be Flying Off the Market – [maybe not], but home sales in 2015 are expected to reach their highest levels in two years (Fannie Mae)
- New Homes Are Being Built – housing construction will reach 1.4 million in 2015, an uptick from past years and closer to the average number needed to balance the market (NAR)
- Property Is Becoming More Valuable – for the 27th consecutive month, new home prices increased on a year-over-year basis, increasing a total of 20.7% over the past two years (NAHB)
What questions do you have about selling a home in 2015?
We hope this information generates some questions about the selling process for you. For explanation, clarification or expansion on any of these topics contact us at your convenience.
Yours truly, Ann & John
By: Ann & John VanderSyde
Real Estate Sales/Service – Associate Brokers Virginia Properties/Long & Foster
412 Libbie Ave, Richmond, VA 23226
February 5, 2015