5 tips for first-time home sellers
Buying a home doesn't teach you everything you need to know about selling one.
First-time home sellers aren't real estate newbies. After all, most sellers were buyers at one time or have been homeowners at least for a while. But just because you've bought or owned a home doesn't mean you know how to sell one. The fact is novice sellers face challenges and decisions that are unique to the sales process.
If you're ready to sell, but anxious about the unfamiliar experience, here are five tips you should consider:
1. Buyer's market or seller's market? During the housing boom, houses sold quickly and sellers had a lot of market power. But today, the opposite is more often the case. If you bought your house in the early or mid-2000s, you might be surprised to find out how much the market has changed, and disappointed to discover you don't have as much power as sellers used to command.
This shift in market conditions can be even harder for long-time homeowners to understand, suggests Lane Tharp, a sales associate and senior real estate specialist with Coldwell Banker Residential Brokerage in Dunwoody, Ga.
"They've been in the neighborhood for 30 years," Tharp says. "They've watched what's happened, and they know (the neighbors) down the street sold their house (for more money) and it's not as nice."
The bottom line is that sellers need to be aware of the market and how it affects them, says Jean Bourne-Pirovic, a Realtor and assistant manager at Long & Foster, Realtors, in Silver Spring, Md. These days, she adds, that means "they really need to be reasonable."
2. Well-maintained or marketable? Long-time homeowners also tend to have outdated notions about home styling, oftentimes mistaking up-keeping for updating, Tharp says. Wallpaper that was charming in 1975, for instance, just doesn't have the same appeal some 35 years later.
"They have the idea that they've maintained the house well all these years," she says, "but taking care of a house won't necessarily make it marketable."
Out-dated décor is particularly problematic today because buyers have so many for-sale homes from which to choose, and all of those homes are competition.
3. Defect or flaw? Buyers often ask sellers to repair "everything" in a home inspector's report, Bourne-Pirovic says. And today, in yet another turnabout, they might have the power to make such demands. As a seller, however, you'll want to be more circumspect, since those repairs take a bite out of your profit.
You do have an obligation to make certain repairs, Bourne-Pirovic explains, so it's important to know what those items are. Typically, repairs that are required by law or involve safety or health hazards will be must-dos. But you needn't say yes to every repair. Cosmetics fixes in particular might be a no.
4. Open house or private home? Buyers tend to perceive showings, to use the Realtors' term, as open invitations to walk through as many homes as possible in search of the one they want to buy. As a seller, though, you'll quickly find out that these free looks can be inconvenient intrusions.
"When you're buying," Bourne-Pirovic says, "you're not thinking about having to keep your house clean, in impeccable shape, smelling nice, looking nice and being available seven days a week. You don't think about how hard that is to do until you're putting your house on the market."
5. Well-qualified or marginal? For buyers, financing is all about loan approval, and buyers who are short of cash might be especially keen to get a low- or no-down payment loan insured by the Federal Housing Administration or guaranteed by the U.S. Department of Veterans Affairs, respectively.
For sellers, though, financing is all about the buyer's ability to close and in that context, you might take a loan program that requires a healthy down payment as a better sign.
"As a buyer, you think you've submitted a really good contract, which is basically a lowball (offer) with the minimum down and minimum deposit," Bourne-Pirovic says. "When you're selling, things that are attractive are a higher deposit and a conventional loan, instead of FHA or VA."
Unfortunately for sellers, it's a buyer's market these days. Yet if you follow these five tips, you can set yourself ahead of the competition by convincing buyers that your home is the one for them.
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