9 Costly Mistakes Sellers Make
#1 Not Pricing the Home Competitively.
This is the most common Seller mistake, and can be a very expensive one.
Many times sellers base their pricing on unrelated, unscientific information: how much your next home might cost, how much you originally paid for your home or what a neighbor says it should sell for. An honest, objective, well-researched market evaluation will give you the information that you need to make the right choice.
When you put your home on the market you will experience the greatest activity and number of showings during the first two to three weeks. During this time all the buyers that are currently looking for a home like yours will be exposed to it. There is not an unlimited number of buyers for your home. After the first week or two you will only have new buyers that become interested.
If you originally offer your home at an exaggerated price, home buyers looking in this price range will prefer larger or better homes than yours. Over pricing usually just helps the neighbors to sell their home because your home will make theirs look great.
When a home is over-priced, the people that would buy it often don't even see it because they are looking at homes in a lower price range. By the time you lower your exaggerated price, buyers may be wary because they suspect other reasons the house has remained unsold for so long. The result is that the property now draws low offers and an unwillingness to negotiate.
You want to put your best price forward when you have the very best opportunity to sell it. It is very difficult to get a buyer back in after the buyer has made his mind up about your property.
Price your property too low and you might sell yourself short. In order to obtain the highest offer for your home in the shortest amount of time, you'll need to price it very carefully.
#2 Inadequately Presenting the Home
Make sure your property shows the best it can prior to listing it for sale, or risk chasing away buyers as fast as Realtors can bring them. A property that is not clean, tidy, or well maintained suggests possible hidden defects that will result in increased cost of ownership. Buyers can be poor judges of the cost of repairs, and will give themselves a large margin of error by reducing their offer price substantially. Sellers are always better off doing the work ahead of time.
Sellers can lose thousands of dollars in upgrades only to find that the Buyer isn't willing to pay for them. Only certain upgrades are cost effective in the long run. Easy, inexpensive fix-overs such as floor coverings are generally worthwhile and will usually help you sell faster & recoup your investment. Always consult with your Realtor before committing to big dollar upgrades before selling.
#4 Choosing the Wrong Realtor for the Wrong Reasons
Many homeowners list with the agent who suggests the highest asking price or asks the lowest commissions. You should choose the best Realtor to get the job done with the least amount of legal hassles and for the highest number of dollars in your pocket. Remember that an experienced, effective agent usually costs the same as someone who is inexperienced. Beware of some Realtors whose strategy is to get you committed with a listing contract and then work on your price later. Anyone can tell you anything as far as price goes but be sure that the numbers are solidly substantiated with facts.
Low commissions are a red flag. Many buyer’s Realtors will not show a listing if it pays less than selling a home down the street. This can reduce exposure and the chance of selling for top dollar in a reasonable amount of time. Usually people are worth what you pay them. When you sit down to negotiate a contract on your home, how much confidence will you have in a Realtor that couldn't negotiate his/her own pay cheque?
#5 Not working closely enough with the Realtor.
An agent should be allowed to function as a professional extension of the owners, but that requires the owners' co-operation and commitment. Owners who are too emotionally invested in their property or are rigidly determined to be in control rarely discover what a real estate expert can do for them in marketing, selling and negotiating on their behalf. Those who tap into the skills, knowledge and enthusiasm of an experienced real estate agent are often fascinated by the depth of sales strategies, the breadth of real estate knowledge involved and the agent's determination to achieve the seller's goals. Sellers who want maximum effort from a real estate agent should give a comparable level of effort themselves.
Buyers are "king" once a property is listed - their schedules rule. When sellers restrict availability for showing or refuse to inconvenience themselves by temporarily vacating while buyers view the property, agents are frustrated and sellers are the losers.
Real estate professionals are trained to make suggestions from list price strategies to decorating and clean-up essentials -- all designed to improve selling opportunities. Following these suggestions should go a long way to a successful sale.
#6 Using the "Hard Sell" during showings.
Buying a home is a very emotional decision. Buyers like to "try on" a house and see if it is comfortable for them. Good Realtors know their buyers and let them explore your home on their own, pointing out only relevant features. It is difficult for buyers to focus on their own priorities if you follow them around pointing out every improvement that you made. Many sales are lost when buyers think they are paying for features that are not important to them. It is usually best to not be at home at all & let the Realtor do the home tour with the client. If there are features that need explanation have them highlighted on the feature sheets or have your Realtor post note cards to draw attention to them.
#7 Failing to take the first offer seriously.
Often sellers believe that the first offer received will be one of many to come, especially if they are fortunate enough to get an Offer in the first two weeks after listing. There is a tendency to not take it seriously, and to hold out for a higher price. An experienced Realtor knows that more often than not the first buyer ends up being the best buyer, and that many, many sellers have had to accept far less money than the initial offer later in the selling process. As I mentioned before, your home is most saleable early in the marketing period, and the amount buyers are willing to pay diminishes with the length of time a property has been on the market. After weeks of keeping their home ready for showings, many sellers would give anything to find that prospective buyer who made the first, and only, offer.
#8 Not knowing your rights and obligations.
The contract you sign to sell your property is a complex and legally binding document. An improperly written contract can allow the purchaser to void the sale, cost you thousands of unnecessary dollars or tie up your home needlessly for weeks as Buyers shop for a better deal while you are on hold. Have an experienced Realtor who knows the "ins and outs" fully explain the contract, or have your lawyer review it before acceptance.
#9 Failure to have a Realtor with an effective marketing plan.
In Calgary there are approximately 5000 Realtors that could potentially have a Buyer for your home. Good marketing will expose your home’s best features to the people that will most likely sell it. If your Realtor is offering only the usual open houses and print advertising, you have a Realtor with a salesman mentality. Years of industry studies show that only a few percent of homes are sold at open houses and the numbers are similar with advertising studies. The truth is that agents use these tools to attract future prospects, not to sell the home. Open houses and generic advertising have been proven not to sell homes efficiently.
Today's marketplace demands focused target marketing and your Realtor needs to have a sales manager attitude. Your Realtor’s best use of time is to market your property to the 5000 sales people through the MLS at the Calgary Real Estate Board, via the Multiple Listing Service.
Traditional "old" marketing is still very important. Your home has to be distinguished from the hundreds of others on the market. It also needs to have the features & benefits exploited. But remember that the two most over-used marketing tools (open houses and print advertising) are only part of what is needed. The right Realtor will employ a wide variety of marketing activities, emphasizing the ones that will truly maximize effectiveness & exposure.