On the surface, it may seem there are lots of Realtors to choose
from. But just because there are lots of Realtors out there
doesn’t mean they can all do the same job for you. The right
realtor will keep you from making some common mistakes when
selling your home. Mistake #1: Pricing Your Home Incorrectly
Every seller wants to realize as much money as possible when
selling their home. The natural inclination is to price the home
high, thinking you can always come down in the future. But a
listing price that is too high frequently nets the seller LESS
money than an original price at market value. Why is this?
Because people looking for homes in your price range will reject
your home in favor of other homes in a reasonable price range.
And here’s the real clincher: Agents who would readily bring
buyers through your home will automatically cross it off their
showing schedule because it’s priced too high. They’re only
motivated to show homes with the highest probability of selling.
Agents simply will NOT show overpriced homes because they work
by commission. They know market values because it’s their job to
know. And they don’t want to waste their time. So you price your
home high, thinking you can come down. Problem is, the agent and
buyer community doesn’t look at it that way. They see it as an
overpriced home. After a few months go by, 8 or 10 open houses,
signs, Realtor tours…and not a nibble. So you decide to lower
your price again. But it’s too late…your home has already been
“branded” by the Realtor community. So you reduce your home a
little more. And little happens. Finally, in order to attract
attention back to your home, you’ve reduced your home price more
than you ever thought you would, and you’re now netting much
less than if you had priced it correctly in the beginning. And
think about this: the money you lost is not just the lower sales
price, but all the extra interest you paid on your
mortgage…all the extra property taxes and other carrying costs
that accrue while your home is waiting to sell. I’ve seen it
happen time and again! Real Estate Fact: The Seller Is Solely
Responsible For How Much, And How Quickly Their Home Sells!
Overpricing almost always increases time to sell, and adds to
your carrying costs. Here are a few areas that a professional
Realtor can help you with: How to set the asking price to
maximize exposure and a profitable sale… How do you really
define and compare market value between homes? How the
principle of “substitution” affects the value of your home…
How to protect yourself from crime when selling your home…
How to handle buyers during a showing to help yield the highest
price. Once you understand these important issues, you’ll know
how to price and sell your home for the fastest, most profitable
sale. Also, with this information, you’ll never pay too much for
any home you buy for the rest of your life. Mistake #2: Limiting
The Marketing Exposure Of Your Property The most obvious
marketing tools everyone uses (Open Houses and classified ads)
are only moderately effective. Successfully marketing of your
home (getting the highest price, at the right time, and with no
hassles and problems) requires much more. Surprisingly, less
than 1 percent of homes are sold at an open house. Agents use
open houses to attract buying prospects, not to sell your home.
And advertising studies show that less than 3 percent of people
purchased their home because they saw it in an ad. That’s why
the most competent Realtor will have a broad spectrum of
marketing activities, emphasizing the specific strategies that
will work best for YOUR particular property or area. This way,
your home is NEVER put “On Hold” or a showing is delayed for a
single minute when a hot inquiry surfaces. Mistake #3: Thinking
Your Appraisal Is The Market Value Of Your Home An appraisal is
an opinion of value for an entirely different purpose than
selling your home. Usually an appraisal is to provide a bank or
mortgage institution information to fund a loan. If a lender is
motivated to loan you money, his appraisal may come in higher
than the true market value of your property. The appraiser might
ignore other issues in his analysis, such as foreclosures in the
market or distressed sales. When a buyer looks at a home, they
look at all the factors: foreclosures, distressed sales,
bankruptcies, divorces, and area fluctuations. Don’t make the
mistake of thinking the “appraisal” value of your home is what a
diligent buyer would pay. Mistake #4: Not Understanding Your
Rights & Obligations Real estate law and regulations can be very
complex. When you sign a contract for the sale of your property,
it’s a legally binding document. An improperly written contract
can create many problems for you: a sale could fall through,
cost you thousands in forced repairs, inspections, and remedies
for items included or excluded in the purchase offer. You must
understand what repairs and closing costs you are responsible
for in a contract. And you must know whether the property can
legally be sold “as is,” or how deed restrictions or local
zoning will affect your transaction. You also need competent
review of your title, and whether or not your property is in
conflict with local restrictions or laws. If you have to remedy
these items yourself, you can spend thousands on legal bills,
fines, contractors, and other costs. Using a competent Realtor
up front can help identify and avoid these issues before they
become “problems.” Mistake #5: Signing A Listing Agreement With
NO WAY OUT! Just about every agent has good intentions about
helping you sell your home. But situations and circumstances
change. The agent might have personal problems, or simply decide
to retire or get out of the real estate business. Or other
situations may arise where the agent isn’t doing his or her job
as you expected. The home may not be getting the exposure you
desire. Or perhaps you haven’t heard from your agent in 6 weeks!
What do you do now? When this happens, you should have the right
to fire your agent. But the listing agreement you signed is with
the BROKER, not the agent. If you’re unhappy, the broker may
assign your home to another agent - someone you neither
personally selected, nor do you want. But you’re stuck with him
or her until the listing agreement expires. And that can cost
you a lot of money. Always protect yourself by 1) carefully
selecting the right Realtor, and 2) make certain that in a
“worst case” situation, you have the flexibility to cancel your
listing agreement. Mistake #6: Selecting The WRONG Realtor Do
you remember the old riddle that goes, “What do you call the
person who graduated dead-last in their medical school class?”
Answer: “DOCTOR!” Well, it’s the same with Realtors. Someone
with vast experience and extraordinary professionalism usually
costs the same as someone with little or no experience, or with
compromising standards. You need to know how to tell the
difference up front. Bringing competence and experience into
your transaction may mean the difference between a higher
negotiated sales price and losing money, selling in less time or
in more time (costing you potentially thousands in added
interest), and experiencing problems and hassles or a
problem-free transaction. Most communities are loaded with
Realtors who are WRONG for you, your area, and your home. Some
agents are in business part time for a little extra cash. Others
are subsidizing other businesses or careers. And then there’s
your “cousin Harry,” whom you feel obligated to because he
“really needs your business.” Selling your home is probably the
most important financial transaction you will ever make. Your
Realtor should take their business very seriously. Here’s what
your realtor should offer to market your home: A full-time
marketing specialist, a full time asisstant, a cellular phones,
a laptop computer, 2 phone lines, and and you should never wait
more than a few hours for a return call. This is the difference
between agents who simply “sell” real estate, and those who
COMMIT to whatever it takes to serve a client beyond their
expectations! A Realtor who has been in the business for at
least 5 years, and sold at least $35 million of homes. They
should be intimately familiar with the neighborhood/area, and
specialize in selling homes in your price range. They should
be a full-time Realtor, well educated and have a complete resume
for your review, and make it a priority to educate YOU on every
aspect of your transaction. They should have a list of
references, past clients, and professional associations whom you
can call at any time to discuss the quality of service they have
provided to other people just like YOU. They should have a
specifically designed marketing tracking systems for every home
they sell. They should also have specific update systems so you
are fully aware of ALL activity and progress updates on your
home on a weekly basis. So you will NEVER feel out of touch!
They should guarantee everything they do! They
should have references for reliable title companies, escrow
companies, financing sources many agents are clueless about,
insurance companies, inspectors, attorneys, and others directly
relating to your transaction. If you choose to use any of them,
you won’t be dealing with arbitrary people. These should be
professionals they have used personally in other transactions.
They should schedule showings around your schedule, and to
respect your personal and family time. This requires special
planning and forethought most agents do not consider. Most
Importantly: They should generate at least 50% of their clients
through referrals. They should focus 110% of their efforts into
providing such outstanding service that their clients are
inclined to refer your services to family, friends and
acquaintances. When selling your home, the LAST thing you need
is added pressure. That’s why you need a realtor to answer all
of your questions. And give you one less thing to worry about
during these hectic times.
