Only read this if you are SERIOUS about selling your home.
If you are just curious to see what the market will do, this article is not for you.
Here are some hard and fast rules when working with a Mableton Realtor or any other Realtor to sell your home and get the top available dollar of what buyers are paying for homes like yours.
How to interview an agent
When you sit down with an agent, talk pricing first, then commission, then marketing or other concerns in that order. If the agent gives you a really odd ball price and does not show you evidence as to why you should price it that way, there is no reason to move onto commission or other details. With price being the most important factor, if that is not properly set, the home will never sell. Some newer agents (and some old) don't understand pricing and how to find the true value of what buyers are spending on homes like yours. Having that knowledge is key to getting the price right. Yes, they all get the same stats, but some agents aren't good with the numbers and don't have the skill to be able to analyze them correctly - guessing won't cut it. The agent should be able to give you a good price based on the numbers and what the market is doing. Remember, a price without proof is only a guess.
How long of a listing term should I have?
You should list your property for at least 6 months. You can break this up into 2 listing periods, with either the same or different agents you choose to work with. Make sure you are listing your home to be in at least 2 selling of the 4 selling cycles within a year, which would be around 4-6 months for proper exposure. In Mableton, Georgia and in most areas near Atlanta, Georgia there will only be a handful of buyers looking for homes exactly like yours in any given month. For example if you live in Mableton, your price range you may have only 5-7 buyers buying homes in a particular month. And with only listing your home to sell with a 90 day contract you are likely only going to see 15-21 buyers during that time frame. If you are not positioned or priced correctly that percentage goes down by half or more in the same amount of time, down to 7-10 buyers that will come through your home. If you double your listing period, you should expect to see twice as many buyers come through your home during that time. The only caveat is if you are priced too high for what buyers are looking to pay. Or your condition of the home is not what most buyers are willing to live with.
What does an agent do all day?
Most of your agent's time is spent doing paperwork, ads, convincing buyers and other agents to see your home, following up on leads for your home and driving people around all day. (*As a side note most sellers think an agent just puts a sign for an open house and sit in the home for 2-3 hours. But most successful open houses take days to pull off. The day of the open house for an agent is actually 4-6 hours on what is normally a day off).
What happens if my home doesn't sell?
Most sellers blame their Realtor when their home doesn't sell and some of the time that is the case, however more often than not it is the price and condition of the home that keeps it from selling. No amount of marketing will sell an overpriced home... NEVER!! If you are overpriced by more than 10% you will sit. Chances are buyers who write offers on your home will only low ball you and add to your frustration. And the agent you hire will still make money from the buyers they get from the marketing of the home and will sell your buyers better priced properties.
Fear based selling and the problem it causes
The number 1# fear that most sellers have is under pricing their homes. And in doing so, they tend to over compensate and over price the home thinking that someone will talk them down later when the opposite is true... Another falsehood with that fear is that the seller thinks they are giving their home away. In fact sellers will say," I don't want to give my home away." When it actuality that almost never happens. Buyers are very savvy and with homes being on the internet, they can shop thousands of homes in a matter of minutes and pick out the best priced homes and leave the rest to sit unseen for months on end. If you are even a tad bit overpriced, they won't waste their time to get their agents, make an appointment, drive across town; make you leave for an hour or so after you spent all morning cleaning the house, for them to see it, just to say it was overpriced. They will just consider you unrealistic and not want to see the home to begin with if the price is not in line or better than other similar homes in the area.
Selling from loss and the problem it causes
Now if you are the type of seller that needs to get a certain amount out of your home in order to purchase another and cannot go below a certain threshold in order to so, you may need to consider staying put for the next 3-4 years. The market is at this point still going down and what may seem like a bad price now, will be an even worse price later. Listing your home based on the amount of money you need to make, is a set up for a big disappointment later when no offers have come in at the price you have set. At this point you would have wasted time and effort and you would be better off not having tried to sell the home at all. Other sellers feel they are losing if they break even or have to come to the table with money. In reality with only a handful of buyers willing to buy your home, you win. If you absolutely have to sell your home, it better to pay a little than pay a lot as the market trend is still going down. Feeling upset that you are now selling for less than you paid or less than what the home was worth a few years ago is a waste of energy. You know by now that real estate has a cycle, sales go up and sales go down. You must make a decision to either hold for better times or cut bait and get out now. Those are your options.
How do I select the asking price?
Your asking price should always be based on the market for similar homes. If you doubt the prices you have been given by more than two Realtors, who presented proof of what your home is worth based on market stats, hire an appraiser that will charge you upwards of $300 dollars to tell you the same thing. Realtors look at way more homes than both you and appraisers do and always know where the best deals are. Save yourself the time, money and energy and price it according to the market.
Also when hiring an agent, remember that advertising does not sell houses, prices do. Homes can never be more expensive than what a willing, ready and able buyer is willing to pay. Consider the fact that Aston Martin, a type of car is advertised all of the time, but not at a price many people would pay to have one. Just because it is advertised and marketed a lot, doesn't mean it will sell to the masses – unless the price is right.
What to do if I need to adjust the price?
Plan ahead for your price reductions. Picture this - your home hasn't had a showing in 2 weeks,. It’s completely dead. No showings, no calls, and no open comes to your open house. That means you are overpriced. You don't need to plan on what the reduction price will be in advance, but it should always be tied to what the market it doing. Do plan on having a price reduction if you really want to sell and not just list the home. Just listing the home to see what will happen is a waste of time and energy and money on both your part and on the Realtor's. Your part because most sellers will need to do upgrades or repairs or paint and have the yard and home staged when that money could have gone to something else. And on the agent's part because of all of the advertising money and gas money spent on driving buyers to your home, not to mention all of the hours it takes to do the back office tasks and legal work when representing a client.
Here is a schedule to do your price reductions.
Consider this scenario: Your home has been on the market for two weeks and there have been either no showings, or showings without any offers. According to the National Association of Realtors (NAR) statistics, a reduction needs to be made after ten showings with no offer, or two to three weeks with no showings.
10 showings with no offer = price reduction
2-3 weeks with no showing = price reduction
You may even want to have a price reduction already in place. For example, if your home has ten to twelve showing without an offer, the market is telling you that you are at least 5 percent overpriced. Most people will consider writing an offer within 1-2% of market but not 5% or over. If it is not getting even that, it is at least 10% over price. Keep in mind that the price bracket of the home and the percentage that it is overpriced can affect the rate of reduction.
Percentage of Price-Reduction
10-12 showings + no offers = 5 percent lower price
No showings = 10% lower price
Get Into the Next Bracket
Make the reduction significant enough to reach a new set of buyers searching online. Buyers tend to search by increments of $10,000, with a lower and upper limit. Dropping from $250,000 to $247,000 will not get any new buyers to your property - but dropping to $240,000 will open up your listing to the buyers who have set their upper limit at $240,000 as well as the buyers who start their search at $240,000.
What if we are upside down on our mortgage or can no longer make payments?
With 1 of out every 8 Georgia owners in trouble with their mortgage, you by far are not alone. You may need to consider doing what is called a short sale. Quickly, a short sale is when you negotiate with your lender/bank to take a percentage off the loan you owe them in exchange for finding a buyer who will take it off your hands. It allows you to sell your property without having to go through a foreclosure. Now, you will not be allow to make any money off of your home since the bank is taking a loss, but you can breathe easier knowing you don’t have the burden of your entire mortgage on your back. You will have to provide them with proof that you can no longer keep your home. If you have a hardship it will go a long way with getting your short sale approved. A hardship would be one of the following:
Death in the family
Illness in the family
Job transfer to a new state
You will have to complete a packet similar to what you filed out when you bought the home. They will get into your personal finance history, so don’t let that surprise you. You will also need to have your home listed. The good part is that in most cases the bank will pay the Realtors fees, so that is one less hassle for you to worry about.
How should I communicate with my agent?
Communicate with your agent on a weekly basis. If there are changes in the showing times they can show, or if you are going out of town or if you get a new pet that will be in the property during showing times, let them know ahead of time.
Be sure to ask your agent for an update stat report on a weekly basis. These are available to you as a client and your agent should not have a problem providing them for you.
Free Prize Inside
Kids like free prizes and so do buyers. Offer seller concessions to sweeten the deal.
In a buyer's market, sellers need to be prepared to make financing concessions. Seller concessions that serve to reduce the buyer's interest rate tend to be far more advantageous to all parties than price reductions of the same amount. Ask your agent about the seller concessions and real estate financing concepts that are creating a competitive edge in the current market, and work closely with a loan officer who is knowledgeable about the details. Take the role of an active seller, not just a one that will wait to see what happens. Let the buyers know that you are serious about selling.
Here are some ideas:
· As a seller you can offer 6 percent of total costs to pay down all closing costs and prepaids.
· As a seller you can finance point buy downs or 3-2-1 buy downs. For an explanation of what those are, contact your mortgage/banking consultant or Realtor.
· Offer to pay for the appraisal and/or offer a home warranty
· In condo communities you may offer up to 6 months in HOA fees
· Communicate concessions by having your agent to update the MLS, use sign riders and make calls to other agents in their networks and in yours.
Remember these tips are for serious home sellers.
And finally....Know when to call it quits
Determine a point where your home will no longer be able to compete with the hundreds of others vying for just a handful of buyers. Be prepared to walk away with no hard feelings between you and your agent for the time they have vested in you as a client without being compensated for their time. If they have truly worked hard to get your home sold, but for any number of reasons it couldn’t work in your favor, a small token of appreciation for your agent would be welcomed as well as referrals you could send their way for a job well done.
Provided by Jackye Mumphrey the Mableton Maven for www.GotMableton.com – Mableton Realtors
The Mableton Real Estate Maven has the expertise to get your home SOLD and not just LISTED!
Jackye Mumphrey, Associate Broker, The Real Estate Maven