Here are the seven most important things to keep in mind when selling your own home. This is information we use to sell our listings. I’m providing the information to you because I want you to succeed and because I hope to earn your business should you decide to list with an agent at some point in the future (if I’m this helpful now, imagine how much more helpful I will be when I earn your business).
I am also prepared to provide you with a free “For Sale By Owner” sign containing an 855 number with a pre-recorded description of your home. This 855 number will also forward the caller directly to your cell phone and even allow them to speak directly to a lender. If you’d like to take advantage of my offer please request the sign here.
Pricing
Sellers often price their home high to leave room for negotiations. However, what typically happens is that buyers will skip properties priced high in favor of properties priced at market value. In addition, buyers will often want to “share” in the commission savings of a “For Sale By Owner” and offer 3-6% below the asking price. They don’t take into consideration that you may have priced your home at 3-6% below market value since you are saving on a commission. The best thing to do is arrive at the fair market value you will accept for the home and STICK TO IT.
Realtors, while not appraisers, have a great deal of experience with the appraisals on homes they’ve sold and can apply some of the same value logic used by appraisers while creating a Comparative Market Analysis of your home. They will look at similar properties sold near you and take things like upgrades, size differences, condition, and neighborhood into consideration to arrive at a fair market value. If a Realtor offers you a Comparative Market Analysis, TAKE IT. Worst case, you will get a few calls from the agent hoping to get your listing, but, no matter what, you will have a pretty accurate fair market value.
Staging
You KNOW your home is beautiful just the way it is! But beauty is a very personal thing and no two people will ever agree on all beauty. I know this may be difficult for some of us. When you’re trying to sell your home, you want others to see THEIR VERSION of beauty, NOT YOURS! To do this, you must think in minimalist terms. LESS IS MORE! Look at this as an opportunity to start packing for your future move.
Pictures
We all love pictures of our favorite family events and family members, but that often makes buyers feel uncomfortable. They see YOU in YOUR home when you want them to see THEMSELVES in THEIR home. Take those family portraits and start packing them. Replace them with a few NEUTRAL scenes or still life pictures.
Religious Décor
While we are all proud of our faith, you must remember that there are many faiths in the world and buyers may have a different faith. Despite our desires to stay true to our faith, you must keep in mind that your goal is to sell your HOME. This is a good time to bubble wrap and pack all religious items.
Collections
I am an avid coin collector, but while I am proud of my collection, I want my buyers to focus on the HOME I want them to buy and not the collection that is not for sale. This is a great time to take inventory, bubble wrap, and pack that collection.
Other Decorations
A mantle with a single vase in the center is much more appealing to buyers than a mantle covered with decorations. One plant in a corner makes a room look much more open than a corner full of plants. You want to give your potential buyers the sense of openness in every room. Start packing some of those extras and get ready to move.
Curb Appeal
Most buyers will make up their mind about a home WITHIN SECONDS of pulling up to the curb. Your home can look like the palace at Versailles on the inside, but if they were turned off by what they saw when they pulled up, they won’t even notice. This is a great time for a little trimming, mowing, and weed pulling. You want your potential buyer to be excited about seeing what else you’ve done with the place.
Photos
Today almost everyone has some smart phone with 6+ megapixels picture size. While that’s great for outdoor photography, it’s probably not the best for indoor photography of a home you want to sell. Inside a home you must deal with low light, backlighting from windows and doors, narrow field of view in smaller rooms, and much more. In addition, you want to show your home’s fine features and not the view down your street, the sign at the entrance (unless it’s a major selling point), or the neighborhood. Your potential buyers will see all those things when they drive by. Your photos need to highlight the HOME. The more pictures you show, the better your chances of finding an interested buyer.
Realtors often hire a professional photographer or at the very least take photography classes or seminars. Most professionals and savvy Realtors will use a technique called High Dynamic Range or HDR that takes three different exposures of the same photo and merges them together to eliminate backlighting and low light situations. In addition, most will also use wide angle lenses to make the smallest of rooms look large and bright.
Marketing
How do you get the word out that your home is for sale? You tell everyone you know. That includes your family, friends, co-workers, and neighbors. You tell them face to face, e-mail, social media, phone call, or text message. You post it on Craigslist and any other website that allows you to post properties for sale by owner. DO NOT waste your money on newspaper ads, people don’t read newspapers anymore. Some other suggestions are:
Yard Sign
A yard sign is a great way to keep reminding your neighbors and anyone who visits them that your house is on the market. DO NOT just scribble on a cardboard box with a felt tip marker, quite often they’re hard to read at best. Find the brightest and biggest “For Sale” sign you can and plant it in your yard.
Flyers
Depending on your budget, you may want to place a stack of flyers in a box under the sign. You can also distribute copies of these flyers to your neighbors. Remember to keep the box stocked.
Online Advertising
If you’re going to post your sale on social media, Craigslist, or other website, be sure to include an accurate and thorough description of your property with a lot of pictures. Listings with lots of pictures will spark much more interest than listings with just one or few pictures.
Open House
This is a good way to get people to see your home. Schedule a 4-6-hour window on a Saturday and/or Sunday between 11AM and 5PM. Post signs directing people to your home at least an hour before your start time and as far as a half mile away specially on busy intersections. Again, try to avoid using felt tip marker on cardboard signs if possible. Have visitors “sign in” with a phone number and e-mail address so you can follow up with them.
CAUTION: Remember that this is YOUR home and YOU need to PROTECT IT and YOUR FAMILY. Realtors attend classes on safety and learn ways to protect themselves and your home when showing it or hosting an open house. Make sure all your valuables are stored in a safe places.
Realtors have the advantage of putting listings on the Multiple Listing Service (MLS). The MLS gives a listing instant and constant visibility to thousands of agents all over a several counties. These agents are often working with several buyers that may be looking for a home just like yours.
Qualifying Buyers
Unless you want to spend all your time showing your home to people that do not have the means or intentions of buying it, you may want to insist that all your potential buyers get pre-approved by a lender for a large enough amount to buy your home. This ensures that you only show your home to people who can not only buy your home, but who have also provided a lender with personal information that could later be used to identify them. This reduces the number of showings and gives you some assurances that they are not just “casing” your home. Find a lender to whom you can refer potential buyers if they don’t have a pre-approval letter or a lender.
Realtors will seldom take buyers to see properties without first having a pre-approval letter from a reputable lender and they won’t take them to see homes priced too much above their approved amount. All Realtors have lenders with whom they work often and who can pre-approve potential buyers promptly.
Negotiation
So, a buyer comes to you with an offer, now what? Make sure you are familiar with the forms required. You can find them on the internet and you can purchase copies for download or mail for under $100. Remember the point I made in the “Pricing” section, know your number and STICK TO IT! Keep in mind that buyer’s offers often include requests for the seller to pay for closing costs and other fees that will reduce your proceeds. This is especially true with FHA and VA buyers (with VA loans, the seller typically pay for most of the closing costs).
Typically, sellers pay for the buyer’s title insurance, termite inspection and certificate, transfer fees, a homeowner’s warranty (up to about $500), and natural hazard inspection. Buyers typically pay for the appraisal and inspections. Escrow fees are typically split by both sides.
Realtors are licensed by their state and must pass a rigorous test to ensure they understand all the real estate laws in their state. They also take additional courses on negotiating real estate transactions to help them get the most bang for their buyer’s and seller’s buck.
Escrow
An escrow company is an impartial third party licensed and bonded to handle a real estate transaction. They use your purchase agreement as a starting point for the escrow instructions they will follow to ensure a successful and timely closing of your transaction. The seller opens escrow by sending a signed purchase agreement to their escrow company and the buyer confirms it by sending their earnest money deposit (EMD) to escrow. From that point forward all disclosures, inspection reports, appraisal, and loan documents go through escrow. Once they have all conditions in the escrow instructions met, they can record the new deed and disburse funds transferring money to the seller and title to the buyer. Find an escrow company in your local area and ask them how and when to engage their services. Real estate attorneys can also function as escrow agents.
Realtors have preferred escrow companies they work with often. These escrow companies are sometimes located within the real estate company’s office so the Realtors can closely monitor their transactions on behalf of their sellers.
