10 truths that sellers must know
Published 6:35 pm, Thursday, October 6, 2011
It's a tough market out there.
Buyers and sellers are finding themselves at odds these days in many, if not most, local transactions. Negotiations are protracted and sometimes painful. Buyers are super-cautious, trying to protect themselves in a fragile marketplace. Sellers have dug in their heels, in defense. Agents are working three times as hard as we did a few years ago to bring a transaction to the closing table.
It's exhausting for everyone involved. But I find it's most difficult for sellers, who are faced with the reality of today's down market, as well as the forecast that next year's market is unlikely to be much -- if at all -- improved.
When sellers dig in, they may make decisions during negotiations that they later regret. Most listing agents can cite at least one instance of an offer not accepted that their sellers would handle differently if it were possible to do over again.
With that in mind, I offer 10 truths of today's market, selected especially for sellers.
1. The longer your house is on the market, the less it will sell for. The first question today's buyers ask is how long a property's been listed. They love to hear when it's been awhile. It makes them feel they can snag your house at a deep discount. Price your properly correctly from the start, and you'll net the highest sale price. Although "testing a higher price" and "leaving room for negotiation" may sound like common-sense strategies, they are unwise in the current market. Usually they just result in extended market time, whereas "pricing to sell" gets the job done quickly and profitably.
2. If your house isn't being shown, it's priced too high. It really does boil down to that. Reduce to the correct price and the showings will begin.
3. Expect that buyers bidding on your house will start low. It's almost impossible to convince them not to. When this happens, try not to panic. It will be much easier for you in the long run if you don't take it personally. Just because a negotiation starts out low doesn't mean it can't conclude at an acceptable end point. Be positive. Be patient. Be happy that a buyer selected your home out of all the options they could have chosen instead.
4. Your first offer will be your best offer. This long-standing maxim in the real estate business is true now, more than ever. Time after time, when a first offer is rejected, subsequent offers are no better. In fact, they're usually not as strong as the first one.
5. A really well-priced property will generate multiple offers and sell at or above list price. Yes, even in this market. "Drama" pricing is the best way to maximize your sale price and reclaim the advantage in negotiations with buyers. It's a gutsy but reliable strategy in every market and especially in this one.
6. Staging is no longer an option. An uncluttered, well-decorated home that appeals to the taste preferences of your target buyer will sell fast and at top dollar -- despite significant flaws. Properties without such flaws that buyers deem "old and tired" will not. With so many choices available to them, buyers gravitate to houses that they perceive will need the least amount of work once they move in. The savviest sellers are consenting to have their homes staged. If you don't, you'll be at a big disadvantage in today's high-inventory market.
7. Be prepared for online showings. The Internet has changed everything about how homes are bought and sold. Today, your first showings will be online, so you need to make sure your property is presented well on the Internet. Buyers, who are looking for as much information as possible, routinely reject listings that don't have multiple, professional-grade photographs, detailed descriptions and blinking headlines. If your home doesn't shine online, you may be left in the dust.
8. Sellers whose homes are overpriced end up hurting themselves in the long run. Overpriced listings add to inventory and negatively affect supply and demand, resulting in downward pressure on prices.
9. Agents who consent to take your overpriced listing are doing you no favor.
10. Lenders are really the ones in charge today. It doesn't matter what a buyer is willing to pay for your house if the pre-purchase appraisal comes up short. Yes, you can appeal and yes, you can try to renegotiate. But if there's a significant shortfall your deal will probably fall apart.
It's not easy for sellers in a buyer's market. But sellers who follow these guidelines will be among those who can proudly say they got their house sold in the most difficult market ever.
Evi Coghlan's "The Real Deal" appears every other Friday. She is a licensed real estate agent with the Riverside Avenue office of Coldwell Banker and a former marketing consultant to Fortune 100 companies. She may be reached at 203-247-6691, by emailing her at firstname.lastname@example.org, or visiting www.evicoghlan.com.