HOW SHOULD YOU PREPARE YOUR HOUSE FOR A SALE?
You can prepare your house for selling by taking it seriously.
The lack of inventory in the market may give sellers the false impression that they don't have to do much and can command any price. While it is true that sellers don't have to do much while still claiming a bit of equity, they can still leave money on the table. This blog will discuss best practices for ensuring that you get the highest price on your home.
Note: For people that prefer learning through audio, this content can also be found on our podcast. This episode ran February 22, 2022. |
3 tips for home sellers
tip 1: set the right price
Setting the wrong price can cost you a lot of money.
If a property is incorrectly priced (most likely, overpriced) it sits on the market for too long (in most of Colorado that's 2+ weekends) and develops a stigma. It's human nature to want what others want, and people don't want a house that's been sitting too long. Because of access to digital platforms (Redfin, Zillow, Realtor.com, etc.), buyers can see how long a property has sat and they will reject it outright or start making arbitrary price cuts. In my experience, buyers are much more likely to pay attention to days on market over price reductions, so even if you started high and then brought down the price- they still regard it as a stigmatized property that should be further reduced.
How to avoid improperly pricing your home?
You can avoid improperly pricing your home with comps. This will protect yourself (you may be emotionally attached to a home and see more value in it than the market does) and it will help protect you from ambitious (and potentially dishonest) real estate agents that overpromise on the price to secure your listing. When considering pricing and comps, consider the following:
Timing: comps should be pulled in the last 60-100 days
Geography: comps should be within .25 miles (best) to a mile from your house (necessary if you can't find the inventory)
square footage: comparable houses should be within 400-500 sq ft of your house.
Bathrooms: these are more important than rooms, in my opinion- as long as the square footage is similar.
Garage spaces: people really like their garages
Lot size: this is relevant on properties with a lot of acreage
School districts: School districts make a big difference on housing prices in Colorado Springs. House buyers pay a premium to be in District 20, and those houses usually cost more than homes that feed into District 11, even though the homes can be geographically close.
tip 2: PROFESSIONAL PHOTOS
Pay for professional photos. Selling a house is a volume game; the more people in your house that like it, the more offers you'll receive. The more offers you receive, the more competitive price and contract amenities you'll receive. The best way to guarantee interest on your property is with professional photos. We pay for our clients' professional listing photos, but if your agent doesn't suggest it or offer them, you can schedule your own with Virtuance for $100.
Tip 3: know thy property
The best way to guarantee a fast close and a smooth transaction is to know your property's risk and limitations before listing. It is very common for buyers to submit offers that state they will buy the property, as is, but that is rarely the reality.
"As is" means buyers retain the right to an inspection but agree to not ask for any items.
The buyer's earnest money is protected through the inspection.
The reality of the situation is that if a major issue is found during the inspection (sewer, foundation, roof, etc.), the buyer will likely ask for these items to be corrected or threaten to walk. As their earnest money is protected by the inspection clause in the contract, they can walk away from the property without incurring any financial hardship.
This is not a good situation for you as your property will have to be relisted, good buyers' agents will inquire why and by law, the seller should disclose the information on the Seller's Property Disclosure.
You can save yourself a lot of headaches by disclosing upfront the issues with the property and pricing appropriately.