Helpful Tips for Buying and Selling Your Home
Some of the most stressful and impactful events in my life have involved real estate transactions. No matter what phase you are in throughout the real estate process (whether you are buying, building, renovating or selling a house), it is a major life impacting event. I have bought and sold, built and renovated, and moved more times than I care to remember, the majority of which have been with small children. Which any of you parents reading this that have gone through a move with small kids well know adds an entire new dimension of stress in and of itself in addition to the major financial decisions and impacts involved. That being said, the more prepared you are and the better you plan your real estate transaction the smoother the process will be. If you do your homework ahead of time a plan and manage the process wisely the event can and will have a more positive effect on you and your family’s life. You know the saying “when you know better you do better”, well its true, especially with important financial decisions that will have a long lasting impact on your life. Thinking back on my own personal real estate history I decided to put my lessons learned down on paper so that others may learn from my many real estate experiences.
Selling Tips - Do Your Own Homework, Be Prepared to List Your House, Plan and Manage the Process
Selecting the Right Listing Agent -
1. Selecting the right listing agent is critical and can make or break your house sale! Research your area, for local real estate agents and carefully review each listing agents’ individual credentials. Selecting the right agent for you is critical because they will have fiduciary responsibility and must represent your best interests at all times. Educational Background, Experience Level, and Neighborhood Knowledge are key factors when identifying your potential listing agent. I highly recommend that you identify and interview a minimum of three agents.
2. A few suggested key interview questions include:
- What is your experience and level of training?
- What is your knowledge level of the target sales area?
- How many listings do you currently have?
- Describe your Marketing Strategy (flyers, online marketing, open houses…) specifically, how will you sell your home-where and how often will you advertise?
- What separates you from competing agents? (good agents will have a ready answer to this question and will be able to quickly describe why he/she is best suited for the job).
- Your ideal agent should be honest, trustworthy, aggressive, good communicators, excellent negotiators, personable, accessible, analytical, hard working, and able to conduct themselves effectively under pressure.
- Has anybody ever canceled an agreement with the agent before, if so why
3. Request a reference list, (ensure that they are not related to the agent) and then ask if they are comfortable with you calling them to ask additional questions. Every working professional has references. Even new agents have references from previous employers. I highly recommend you call between 3-5 references, (especially if you are getting conflicting information regarding the agent’s past sales performance).
4. Negotiating the Realtors Fee, all real estate fees are negotiable. Typically, real estate agents charge a percentage, from 1% to 4% to represent one side of a transaction: a seller or a buyer. A listing agent may charge, for example, 3.5% for herself and another 3.5% for the buyer's agent, for a total of 7%.
5. Before you sign the selling agreement, clarify the terms, define your options for canceling the agreement should you become dissatisfied with the agent’s progress, define how the agent stands behind his/her service to you and what the policy is for cancelling agreements. As in the rest of the business world, time really is money and if you are not satisfied with the sales progress you need to make changes as soon as possible.
Pay close attention to how the real estate agent answers your questions to ensure you have a comfort level with them and feel secure with his/her knowledge and experience. Once you have selected the right agent for you, now it is time to focus on getting your home ready to put on the market. Here are a few suggested critical tips:
Getting Your Home Ready For the Market Place
1. Do your homework and prepare for your next meeting with your realtor, prior to listing your house on the market. Research the competition, do your own homework regarding similar homes for sale in your local area. Make a detailed summary of the comparable homes in your area including the total square footage, neighborhood and/or location.
2. Establish a fair and reasonable market value for your home, one of the biggest mistake a seller can make is over estimating the current value of their home and it is an easy mistake to make, especially if you are emotionally vested in your house. I know this can be difficult, but it really doesn’t matter how much how much money you think your home is worth. The person whose opinion matters is the buyer who makes an offer. Prepare yourself mentally and be open and flexible to your realtor’s feedback regarding the listing value (they are the professionals and can evaluate your home objectively).
3. Pricing homes is part art and part science. It involves comparing similar properties, making adjustments in a comparative marketing analysis report for the differences among them, tracking market movements and taking stock of present inventory, all in an attempt to come up with a range of value, an educated opinion. This method is the same way an appraiser evaluates a home. A key consideration is whether your market is hot, cold, or neutral, and price according to the market temperature.
4. Prepare your home for the market, inside and out by cleaning, de-cluttering, and improving both the interior appearance and the curb appeal. Clean your living space (inside and out), eliminate clutter, stage furniture (every room), clean closets (this is a great time to get rid of unwanted/unused items-not only will it help your house show better/it will cut down significantly on moving and/or storage costs if you are downsizing or moving into a temporary living situation.
5. Do not underestimate curb appeal, if potential buyers are not attracted to the outside-they may not bother to take the time to look inside and may just skip the showing to go onto the next house (especially if the market is oversaturated)! Ensure your property is properly landscaped and porches/decks are free of clutter and decorated.
6. If you need help with the interior design and have the budget hire a professional stager to stage your home or ask your agent to help you with the staging. Secure all valuables (jewelry/personal identification documents/financial documents…), lock in safe or put in a safe place (out of sight).
7. Decide what items will convey and which items will be negotiable as part of the sales price.
8. Make any necessary visible repairs, re-painting and have your carpets cleaned are very inexpensive ways to ensure the house shows well.
9. If you have pets, make sure you have a plan to safely and easily contain them while there is a showing.
10. Market your home effectively by identifying selling points and choosing effective advertising words for the listing descriptions and take home hand outs for potential buyers. Request all draft marketing materials from the agent before they go into production, and make sure you take the time to proof read the documents, you would be surprised at the mistakes you might catch. I have actually experienced agents that have errantly listed the wrong house address for the open house and/or included or excluded certain selling features of the home. You know your house better than anyone and are really the most qualified to ensure key selling points and features are captured and highlighted in the marketing materials.
11. Approve your agent’s marketing campaign, I highly recommend including a 360-degree virtual tour online of both the house and the surrounding property, be sure to include video of the community entrance and amenities (if you are living in a subdivision).
12. Post internet listings online to ensure your agent saturates the internet with photographs/video and a detailed, accurate description of your home.
Showing Your Home
If you have flexibility with your move date, plan to show your home in the spring, your home will show better and it is the ideal time to capitalize on potential buyers with kids (this is a popular time for parents to search for a home to ensure they are settled and moved in for the upcoming school year). Prepare for the open house, be open minded and flexible to buyer/agent feedback so you can adjust your price and current showing condition of the house to utilize your marketing strategy effectively. I highly recommend showing your house by appointment only if you have small children or pets (it really lowers the stress level if you have scheduled time to get the house ready for showings). Develop a portfolio of all of your utility bills for the year to date to leave as a quick reference guide for potential buyers who may have questions regarding the financial costs of owning the home, be sure to also include major appliances and related utility equipment warranty information.
Once you have the house for sale-begin researching your new moving location and even identify flexible month to month temporary housing in case you get the desired offer quicker than expected, have a plan B in case your next house is not in place and ready to move into, most sales transactions are complete within 30-45 days of the initial sales contract.
Managing the Selling Process
Monitor the progress of potential buyer traffic and communicate regularly with your listing agent to discuss buyer feedback and necessary tweaks to the market campaign. Revisit the contract periodically (ever couple of weeks). If you have not had a lot of activity, you need to reconsider the sales price (it may be priced too high). If the market is slow or oversaturated, you may want to consider adjusting the listing price or renting with the option to buy as well if the house does not sell within your required/desired timeframe (especially if it has been on the market for more than 6 months).
If you receive a lowball offer, negotiate by issuing a counter offer. Don't ignore offers. Ask for a kick out clause or first right of refusal if the buyer's offer is contingent on selling a home. Consider making a counter offer contingent on buying a home, if market conditions warrant. Don't be afraid to make a full-price counter offer, if you are priced competitively. If you are priced right, prepare yourself for multiple offers.