Written by Hank Miller
There are an infinite number of ways to completely screw things up. Real estate tends to be a popular arena for those that take leave of their senses and grasp defeat from the jaws of victory. Like gamblers at a casino on a hot streak, sometimes a seller gets tunnel vision and loses the ability to hear sage advice. And like many gamblers, the streak turns real cold, real fast and hitting the wall empty handed hurts.
The reduction in inventory has sellers flexing a bit, in many areas they have the edge right now. In the last several weeks, two sellers of ours thought they were smarter than the market; they discovered otherwise. We listed both homes and within 24 hours – 1 single day – each had a no contingency offer, 30 day close and both were 97%+- sale to list ratios. One was cash, the other 20% down and both homes were in the 400K+ range. We assumed both of these sellers would be breathing rarefied air; they each caught lightning in a bottle. But both fumbled the tremendous gift they were handed. One got greedy and wanted full price and the other hung up over a few items of personal property.
Both of these sellers had prior home sale experience; both were well educated as to the market and what to expect and both were looking forward to getting the move underway. Each has since closed and completed their move but each said the same thing; the rush of activity clouded their judgement; they knew better. Both closed and did OK but both left money on the table because they let emotion get in the way of sound decision making.
Key points for home sellers to remember:
Your home is worth what others like it are selling for – no one cares what you think, what you paid, what you put into it or what “you need”. It comes down to comparable sales in your competing market.
Your home better be well priced, if not it will die on the desk top – buyers and agents are wearing out the internet and researching homes from the desk top. It might be OK to push a little but some sellers think 15%-20% over market is fine, it’s not. The days of wasting time and money driving around looking are “nice” homes are over. You won’t get an offer if the door doesn’t open – no matter how “great and special” your home is. And the door doesn’t open on overpriced homes.
Eddie the Appraiser is angry – angry at reduced fees, increased requirements, increased cost of data, cost of gas, less work and constant battles with underwriters and agents. Eddie’s goal is to get in and get out and get your appraisal off his radar. The result? Often lower quality reports that are hastily prepared – and they can cause issues for sellers if proper data isn’t there to support the contract price. Appraisal level preparation is a huge asset.
The buyers out there know what they want – and in my experience, when it pops they will move on it. A well-presented, well priced home will attract attention when listed. Our buyers have searches set for areas they like – emails are sent from the MLS when listings meeting their criteria appear. When your home hits the market, the first few weeks are critical – typically most of the action will come in that time. After that, it slips into the mix and becomes one of many and it’s harder to stand out.
Your first offer may be the best offer – and maybe the only offer. Buyers are having a tough time adjusting to an even-slightly seller’s market. You might get a “low ball” but every offer must be considered and negotiated no matter what you think of it. Sellers must have a definition of success before a contract is received – take the emotion out of it and treat it like business. Have a “great” price, a “good” price and a “let’s move on” price written down BEFORE the house hits the MLS so you are not emotionally charged when a decision is required.
Trust the data and trust your agent – smart sellers Google and research their agent and only use full time experienced pros. A professional will ensure that you understand and ACKNOWLEDGE the data; understand the process and how fast a they might generate a buyer. If you have to sell, then sell. If you’re thinking of “testing the market” then have a contingency plan ready if you get what you want. Know as well that a “test” run will show up on the history of your home if it’s listed in the future.
Define success and execute when it’s obtained – before that sign goes up understand the who, what, when, where, why and how of selling a home. Write down those three prices noted above, know what your next move it and get prepared for that ahead of time. The buyers ready to go are the successful ones.
The bottom line is that real estate has changed more in the last five years than the last fifty. Transparency has turned it on it’s ear and more (thank God) is coming every day; the internet has broken the Iron Curtain of secrecy that this industry has been shrouded in. Everything is moving faster, this is becoming a 24/7 environment driven by the easily available data that once was for agent eyes only. But all the data is useless unless it’s properly applied – and that is the job of the listing agent. Research your agent and then listen to them, this is what a pro does ever