Are you planning on selling your home? Understanding your competition is very important. Understanding the dynamics of the marketplace, with rising interest rates and what todays buyers want and don’t want is even more important. Unlike years ago, buyers today do not want to do a lot of work on a home that they wish to purchase. This is especially true with interest rates doubling over the past year adding $1,000 a month more in many mortgage payments. All homes, old and new, need some attention to get the home market ready for sale. The key here is understanding what to do and what not to do if you're selling a property. If you fail to understand this, chances are you will not be able to sell your home or you will risk losing thousands of dollars in the process.
To help you understand this, we have listed the top 7 things that you should not do if you want to sell your home. These tips and insights are especially important and true in the environment we are in today, with the uncertainty in the global economy, recent job losses, and the continued need for social distancing.
This is part of a continuing series of articles and helpful tips and insights to help you sell and market your home by Nick Santoro and Joe Santoro of Personal Property Managers. Personal Property Managers specializes in real estate sales and marketing, home downsizing, home content clean-out and removal and estate sales. We service Pennsylvania and New Jersey.
Number 1 – Failing to understand market conditions and market comps
The market has changed dramatically over the past year. Interest rates have doubled. This greatly affects a buyers purchasing power and importantly their ability to simply make mortgage payments. As a result it is not uncommon for buyers to see their mortgage payment increase over a $1,000 a month vs what it was a year ago when rates were in the 3% range.
Market comps have also been impacted dramatically. Sellers need to factor this in when properly pricing a home for sale. It does not matter what houses sold for a year ago. A buyers mortgage company will look at recent sales over the past few months vs the past year when determining whether to finance a purchase or not. Remember if you are a seller you will need to understand the dynamics of the other side of the deal from a buyers perspective and their ability to fiancÃ© the deal. This will have an impact on how a seller prices their home for sale.
Lastly, it is important to properly price your home for sale.Â A seller needs to understand that it must be priced commensurate with its condition and work that may need to be done to the house. For example, if there are major repairs needed or significant updating needed If so, this will have an impact on the selling price and the sellers ability to sell their home. With mortgage rates higher, there is not much money left over for a buyer to spend on updates and this will also affect a sellers ability to sell their home. So properly pricing ones home factoring in its condition and market comps are the number one thing that any seller needs to consider.
Number 2 – Do not over-improve your
Home sellers often assume any upgrades they make to their home will pay them back in full once they sell, but that’s rarely the case. On average you will recoup just about 64% of the money you spend on renovations once you sell—and certain improvements can actually work against you if they’re undesirable in your market.
For instance, you may want to finish off your basement or put a new deck on your home, but be aware that you may not get a return on your investment or may only get between 50 and 60 cents on the dollar back. For more information, you may want to Google remodeling costs vs value reports for your area.
Number 3 – Do not remodel without
proper township permits
Most townships today require a local inspection to obtain a certificate of occupancy. If an inspector comes out to the house and notices major work was done and finds that a permit was not obtained, he may require you to remove all improvements or open walls costing you tens of thousands of dollars. Additionally, sellers are required to complete a sellers disclosure document when listing the home for sale. If it is determined that the seller did not tell the truth, the sale can be stopped and even after the sale the seller can have legal action brought to the by the buyer opening up all sorts of headaches and financial challenges to the seller. So, even though it may be a pain to apply for permits before you knock down that wall or add a deck, this corner-cutting will come back and bite you when you decide to sell.
Number 4 - Do not limit your home sale showing
Sure, no one wants to leave their home at dinnertime. But, buyers are busy juggling work, family, when looking for a new home. If you limit showings to a few hours on weekends, you might miss a potential sale. Be as flexible as possible when selling your home, even if it’s inconvenient, it will pay off in the long run for you.
Number 5 – Do not overlook first impressions
and curb appeal
Even if your home is beautiful on the inside, do not underestimate the importance of the first impression that all important curb appeal has. Make sure your paint job is pristine and your lawn is tidy and mowed. Also replace dead shrubs, prune trees, put out some potted plants, mulch garden beds, and freshen mailboxes. We have personally experienced buyers drive up to a property that they were interested in and then say thanks but no thanks and move on to the next home when they see the front outside of the house in poor or unmaintained condition.
Number 6 – Do not rely heavily on
Open houses were a great way to sell a house in the pre-Internet era, but these days the vast majority of houses are sold through the internet. Having great pictures of your home and videos are even more important today than ever, as more and more people search for homes at their leisure from their laptop or smart phone. Lastly, open houses today can be risky, giving strangers the opportunity to case your home and break things.
Number 7 – Not listening to your Real
Estate Agent or Expert
It’s funny…but when it comes to real estate, haven’t you noticed that everyone you talk to seems to be an expert; from the gas station attendant to your landscaper. But why would you trust the most valuable asset that most families have to someone who is not a licensed professional? Listen the the advice of your Agent. Sure, you no doubt know more about your home than anyone else. But your real estate agent knows more about how to sell it, and how to price it properly, especially in todays market. What a property sold a year ago is simply not the case today. Real Estate is dynamic and ever changes based on many factors, especially now with rising interest rates. And your agent may make some suggestions you might not like to hear, like that you need a new paint job or that the asking price you had in mind needs to be lowered a bit. It’s tempting to take offense or just ignore this advice, but if you do, you could risk seeing your house sit on the market and grow stale.
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For more information on real estate or home downsizing please contact Nick Santoro or Joe Santoro of Personal Property Managers at 215-485-9272 or 908-368-1909. Personal Property Managers specializes in helping home owners transition from their home of many years into a new community. Personal Property Managers services Pennsylvania and New Jersey and offers downsizing services, estate sales services, home staging, discount full service real estate services via its association with EveryHome Realty. Learn more about Personal Property Managers from our recent News Stories.