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Common Mistakes Made by Sellers
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Not using a Realtor®:
You should always go with a Realtor®
instead of a real estate agent. One might think that they are the same, but in
fact, your Realtor®
is directly accountable to you. A Realtor®
is also apart of an organization such as NAR (National Association of Realtors®)
that promotes education for the Realtor®
and for you. These groups are also working hard to make home ownership
affordable. Only a Realtor®
will be able to list your home on the Multiple Listing Service.
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Choosing an agent for the wrong
reasons: You may decide to interview
two or three agents before you list your home. You should base your choice on
how well you feel that you can work with them and based on their level of
professionalism. Each agent should provide you with an accurate Current Market
Assessment (CMA) of your home. Too often Seller's choose the person that
suggests the highest listing price instead of the Realtor®
that suggests the proper listing price and has a proper marketing plan. The
agent suggesting the higher price is usually doing so because they have sensed
that this is what the Seller wants to hear. Setting the initial price too high
will frustrate you when you get very little traffic and the Realtor®
is asking for a reduction after just a few weeks. Meanwhile, you have missed
out on the most crucial time when marketing the home, namely just after it is
listed. If the Realtor®
does his home work properly, the eventual
selling price should be quite evident and you should set your price within
about 5% of where you want to sell. Always put yourself in the Purchaser's
shoes when looking at the CMA to determine, based on the past sales and the
existing active listing whether the price that you want to list at makes
sense.
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Not properly preparing your home
to show: It is important that the
home be clean and well maintained in order to maximize the selling price.
Sellers that fail to make the small repairs before showing their home will
loose out. Small repairs that may cost a few hundred dollars will be amplified
in the Purchaser's mind and they may want a few thousand dollars off the price
to compensate them for doing the repairs. More importantly, it will take
longer to sell a home that is not in a good state of repair. Since you only
get one chance to make a first impression, it is important to do the repairs
as soon as you decide to sell. It is equally important not to over improve
your property since you may not get the money out later. Always consult with
the Realtor®
before undertaking a large renovation job to ensure that the cost will be
justified by the higher selling price.
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Using overly aggressive pressure
at an Open House: An experience
Realtor®
will point out the benefits of your home, give the prospective Purchaser a
feature sheet then allow him/her to walk through the home at their own speed.
The Realtor®
will accompany them and casually highlight the homes features but should allow
the Purchaser the time to test drive the home for themselves. No one likes a
high pressure sales person.
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Not recognizing whether the
person is a qualified buyer: Some Realtors®
do not realize that it is often the person that criticizes the home that is
the most interested prospect. They are taking the time to find out about the
home and to ask about both the benefits and defects with the home. If they
were not interested at all, they could simply save time and walk out. Based on
our experience, we know that we must follow up with all prospects, not just
those that are polite and easy to deal with.
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Signing a listing contract with
no guarantee of service: Make sure the terms
of the listing agreement are explained to you in detail and ensure that any
promises made regarding the level of service that you expect are documented.
You should be aware of the expiration date of your listing and you should
understand what is included with the home and what is not. If there are any
fixtures such as a prized heirloom light fixture, it would be best to change
it once you decide to sell the property.
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Not properly marketing your home:
Always ensure that the Realtor®
that you choose is successful and has a good track record. Advertising is
expensive and many inexperienced agents do not have the funding to carry out
an effective marketing plan, and instead take the listing, put up a sign and
hope that someone else sells the home. Many agents do not like doing "Open
Houses" since only about 1% of homes ever sell as a result of an "Open House".
You should always discuss the marketing program with the Realtor®
before you sign the listing so that you both understand each others
expectations. Good communications are always key to a success relationship.
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Failing to take the first offer
seriously:
There is a saying in the real estate business
that the first offer is usually the best offer. While this is not always the
case, quite often it is. Remember there are always Purchasers looking in a
particular neighborhood and are ready to buy as soon as a good listing becomes
available. These Purchasers usually know good value when they see it. If you
pass on the first offer, because it came so quickly and you hope that a better
one may come along, you may miss out. Your Realtor®
should be able to advise you and you should still have the CMA at your
disposal so that you can determine whether the offer is reasonable or not.
Unfortunately, the longer the house sits on the market, the more Purchasers
and Realtors®
are tempted to offer "low ball" offers to see if the Seller is getting
desperate or not.
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Not Pricing your home properly:
Your Realtor®
should provide you with a proper evaluation showing you how much similar homes
sold for in your neighborhood. Those prices will then be adjusted to reflect
the different features that the comparable home has when compared to your
home. If your home has a larger lot then an upward adjustment will be made to
the comparable price for that feature. If your home is smaller then a downward
adjustment will be applied against the comparable price. The net effect of
these adjustments will result in a Comparative Market Analysis and this should
indicate an approximate value to your home.
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Setting your price based on your
needs: Often homeowners want to set
the price of their home based on what they paid for it, or how much they paid
to upgrade the home since they purchased it. While those factors may dictate
how much you need to move, they do not set the price that your home is worth.
Only the market forces of supply and demand will dictate what your home is
worth.
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