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You’ll Lose Money When You Overprice Your Home
You are probably asking yourself, “did I read that right?”
Yes, yes you did.
It is normal for sellers to want to get the most money out of the sale of their homes. It feels safe to list your home at the price you are desiring to get, but the reality is listing high might actually do your pocketbook more harm than good in the long run. Follow along as we explain why.
RISKS OF OVERPRICING YOUR HOME
You are drawing the attention of the wrong buyers.
Most people begin their home purchasing journey by searching which homes are available in their desired location online. Consider this. Your home is worth $500,000, but you list it for $575,000. When buyers are looking online, they filter to find homes within their price range and typically by $25,000 increments. The person looking for a $500,000 home will never see yours and if they do they will believe it is out of their reach, and when the buyers looking in the $575,000 range see your home and compare it to others in that range, they will get the impression it is not worth it, and there are better options.
Fewer people will see your home.
When your home is overpriced, the issue can be detected by buyers just by looking at your online listing and will pass on viewing it in person. The more showings you have, the more legitimate interest there is, and the more likely your home is to sell. Showings give potential buyers an opportunity to see the home first-hand giving them the opportunity to imagine themselves living there.
On the other hand, if you get lots of showings because your photos look better than reality but no offers you’ve wasted your best shot at getting the right buyer through your home and you there are no redo’s for first impressions. This leads us to our next point…
You are sending the “I’m an undesirable home” message to the public.
As people continue to look for a home and new buyers enter the market, they might see your home online, but by that time they will also see the “time on market”. The longer your home sits on the market, the less attractive it becomes psychologically to everyone. Nobody wants the home that nobody else wants. Once it has lost its appeal the damage is done. You’ll find yourself beginning to reduce your price and often end up at a price less than what the home could have sold for if it was priced right the first time.
In conjunction with price reductions, the longer your home sits on the market, the more expenses you incur. Consider mortgage payments, utility costs, lawn care maintenance, seller’s fees, and more while you are trying to move out.
Your buyers won’t be able to finance if it doesn’t appraise.
Perhaps you drop the price just enough to intrigue a buyer but still above market level. Maybe you’re lucky enough to hook a buyer. Then the appraisal comes back low. Now you either have to come down in price or lose the buyer and start over again, with 20-30 days more on market…
If you are considering selling your home and would like a complimentary analysis to determine the correct value of your home in this market connect with us to be paired with an experienced Windermere agent that can help you with your unique situation and avoid all the overpricing pitfalls.
What to Expect When Selling Your Home
Selling your home can be overwhelming and feel like a full-time job… which is why there are realtors! Good realtors make the process so much smoother and less intimidating. To keep your mind at ease and prepare you for what will happen throughout the sale of your home we are sharing 10 top tips to get you from listed to sold in no time!
Discover what to expect when selling your home
1. Select the right agent the 1st time
It is of the utmost importance that you pair with a full-time, knowledgeable agent who can best represent you through the process. This should be your number one priority. Studies show that homes listed with an agent sell for more than those listed without, and this is for good reason. Great agents dedicate their lives to keeping up with economic changes, are masters at negotiating and getting things done, and know all rules and regulations. This will pay off immensely in the long run if you trust their process. If you are unsure where to start, ask your friends who they trust and about their experience with them but don’t stop there. Interview at least two, preferably three brokers, and the differences should be immediately clear. If you still need help, Windermere has a full-time manager that will ask you pertinent questions about your needs, personality style, and specific goals to make the perfect real estate agent match. Windermere’s ultimate goal is not the sale of a home but to give you a real estate experience you want to share with others! When you are ready to pair with an agent connect with us and we will match you with the perfect broker.
2. Set your timeline
A timeline is valuable in that it will keep you organized throughout the entire selling process. Anticipate that your timeline might change depending on circumstances and your local housing market conditions. You may need to adjust a couple of times, but the purpose is to keep you on track toward your end goal. SOLD! Your timeline will help guide you there. Know what the average days on market are for your home and price range (click here to determine Whidbey Islands) then add an average of 30-45 on that to get an estimate of how long it will take to sell once you go live. Work with your agent to build your unique timeline.
3. Determine your home’s value
The SECRET to selling quickly is pricing your home right the first day it hits the market. Overpricing can create serious problems like not being seen by the right buyers, less traffic both in person and virtually, and worst of all becoming less attractive to buyers the longer it sits resulting in lower offers than if you priced it attractively, to begin with. Your agent will provide you with a (CMA) Comparative Market Analysis which compares your home to others in your local area that recently sold and/or are actively pending. This formulated analysis will assist you in properly determining the best price for your home. Discuss this with your agent. They will help walk you through the process even if you aren’t sure you’re ready to sell yet.
4. Identify issues & execute the plan
This is the time to tackle any unfinished projects and address needed repairs. Talk with your agent to see if a pre-sale home inspection would be advantageous for your unique situation. Begin by creating a list of repairs you can do versus those needing to be hired out. Your agent can help you determine which will be the best use of your time, offer the largest return on investment, and help you find vendors and hire out projects. If money is tight it may be in your best interest to apply to our Windermere Ready Program which gets you cash for fixing up your home to list. Ask your Windermere Agent about how to apply.
5. Put your best foot forward
First impressions go a long way! Start with curb appeal. Clean up your gardens, mow your lawns, clean out gutters, and add a pop of color to your flower beds. If you have any cracked or peeling paint, apply a fresh coat. Make sure to declutter the inside of your home. The best rule of thumb is to remove personal effects and present your home like a hotel in which the buyer could envision themselves living in the space. Talk to your agent about the possibility of having your home professionally staged.
6. Get your home seen
Your realtor will help maximize the exposure of your home. They can list with the MLS, will get your listing on all major sites like Zillow and Redfin, and will be listed on their Brokerage site in addition to their own. These are just a few of the many ways in which your listing can be seen. Be sure to discuss the option for virtual tours with your agent. When it’s time for in-person showings, we suggest that you not be present so that the potential buyers can freely walk the home with their agent, ask questions, and ultimately have the space to imagine it as their new home.
7. Reviewing offers & negotiating
If you price right, you might see more than one offer on your home because we are still in a strong Seller’s market. The offers may be at or above the asking price. When reviewing offers, you have three options: 1. Accept the offer, 2. Make a counteroffer, 3. Reject the offer. These should ALWAYS be made in writing, and you should always give the buyer a short time to respond. Whether you are selling or buying, you will likely find yourself in negotiations. It is important for you to discuss negotiation strategies with your agent ahead of time. At Windermere, we pride ourselves on negotiation tactics grounded in psychology and win-win strategies.
8. Budget for closing costs
Closing costs include things like title insurance, recording fees, government taxes, lender fees, broker commissions, and numerous other things. Be sure to discuss this with your agent ahead of time and throughout the transaction so you don’t feel blindsided at closing and are adequately prepared.
9. The inspection
It is common for offers to be contingent on a professional home inspection. Your agent can prepare you for what to expect from a home inspection. Typically a home inspector will look at things like the foundation, structure, roof, plumbing and electrical systems, floors, windows, doors, and signs for things like water or fire damage.
10. Closing
You finally made it, but before you can officially close there are a couple of things to do. Ask the buyer to release any contingencies, sign the title, and close escrow before releasing the keys. Your escrow agent will help you through this process. Talk with your agent about questions you have about legal documents and settlement costs.
If you are considering selling and would like to speak to an experienced Windermere Realtor for more specific information connect with us by clicking here.
Why you should NOT wait to list your house right now
As the year comes to an end, we recognize a trend where homeowners are motivated to make the move and finally get into a home that complements their changing lifestyles. It is clear that homeowners have begun to understand the benefits of today’s sellers’ market. With record-breaking home price appreciation, growing equity, low inventory, and competitive mortgage rates it makes perfect sense as to why.
To support this, take a peek at recent data from realtor.com that demonstrates a significant share of homeowners that intend to list their homes this winter.
What That Means for Homeowners:
That means more homes are about to hit the market increasing supply to be more in line with demand than we have recently seen. This means there will be more options for buyers to choose from when looking for their homes.
According to George Ratiu, Manager of Economic Research at realtor.com:
“The pandemic has delayed plans for many Americans, and homeowners looking to move on to the next stage of life are no exception. Recent survey data suggests the majority of prospective sellers are actively preparing to enter the market this winter.”
If you are thinking about waiting till the spring to sell your house, keep in mind that your neighbors might be one step ahead of you and sell this winter. If you want to stand out from the crowd, this holiday season is the best time to make sure your house is available for buyers. Here’s why.
Sellers Are Still Firmly in the Driver’s Seat:
Historically, a 6-month supply of homes for sale is needed for a normal or neutral market. That level ensures there are enough homes available for active buyers (see graph below):
The latest Existing Home Sales Report from the National Association of Realtors (NAR) shows the inventory of houses for sale sits at a 2.4-month supply. This is well below the 6-7 months supply needed for a neutral market.
What Does That Mean for You?
When the supply of homes for sale is as low as it is today, it is more difficult for buyers to find homes to purchase. This drives up competition among buyers, who then submit increasingly competitive offers to win out against others in the home search process. As this happens, prices rise and your leverage as a seller rises too, putting you in the best position to negotiate a contract that meets your ideal terms.
The low housing supply we are currently facing will not be solved overnight. Sellers this season should act quickly to maximize their potential. The data demonstrates that, with more prospective sellers planning to list their homes this winter, selling sooner rather than later helps your house rise to the top of a holiday buyer’s wish list so you can close the best possible deal.
Bottom Line:
Listing your home over the next few weeks gives you the best chance to be in front of buyers competing for homes this holiday season. Let’s connect today to discuss how you can benefit from today’s sellers’ market. Email us here.
How to Sell Your Home for Top Dollar
By now you’ve probably heard every REALTOR® you know yelling from the rooftops, We need more inventory!!! “Now is the time to sell!” While that is definitely true, buyers are more selective now than ever. You need a strategy to ensure you hit the market at your very best!
In order to sell your home for the highest price possible and in the least amount of time (meaning less showings, less cleaning, less inconvenience to you), you’re going to need to create the most demand possible when it goes up for sale (with the help of a great Real Estate Agent of course). I have a simple 3-part plan that will help your home get the maximum exposure and create the most demand right away!
PART ONE: Focus on Selling a Lifestyle
You’re not just selling a home, you’re selling a lifestyle. This means you’ll want to think beyond square footage and room sizes and determine how to best highlight the features of your home that will show the lifestyle someone can expect to have if they live there. Think about experiences like holidays around the big kitchen island or gatherings around the awesome firepit out back!
Ask yourself questions such as what feature did you love most about your home when you bought it and which room do you spend the most time in. Share these answers with your Real Estate Agent so they can market a lifestyle, not just the house.
Photo by Jimmy Dean on Unsplash
PART TWO: Stage to Sell
Staging your home for sale is crucial in attracting the most buyers and generating the most interest in your home when it’s for sale.
To get started, depersonalize and declutter first so potential buyers can more easily picture themselves living in the home rather than feeling like they’re in someone else’s home. Make sure to appeal to today’s buyers. Talk with your agent about what updates or small changes will make the biggest impact to attract what most buyers are looking for these days.
Photo by Ashley Byrd on Unsplash
PART THREE: Have a Pricing Strategy
If you want to attract the most buyers as soon as that for sale sign goes up, it’s important to have a pricing strategy in place. Many sellers believe they should list their home over value and lower it as needed, but the problem is that doing this will only hurt your chance at attracting the most amount of buyers possible (therefore driving up the sale price). The problem is that it will decrease the number of interested buyers right when you list, could increase the length of time your home sits on the market and ultimately decrease your final sale price (which means less money in your pocket).
What you feel your home is worth on paper might not necessarily match what the market is saying your home is worth. The current market and the buyers are going to determine the value of your home. Make sure you’re looking at market trends, other homes that have recently sold and be realistic. The best-case scenario is that you get several offers on your home, and you get to choose the price AND terms.
Photo by Scott Graham on Unsplash
With the right real estate professional guiding you and this simple 3-part plan, you’ll have buyers lined up outside your home in no time! If you have questions about how we can tailor this plan to your unique property, let’s talk!
