There are four of the five factors which affect the sale of any home – which owners can actually control. Those are price, condition, terms and the agent you select. The one thing you definitely cannot control is the location of the home – but you do of course have the ability to adjust the other factors to compensate for a poor location.
As a seller – you control the price of the home, which in turn determines its positioning in the real estate marketplace. If the home is priced too high, it will more than likely take longer to sell, and, in some cases, it may sell for less than what it should have sold for. Why you may ask? It could potentially sell for less because it may be assumed that there is something wrong with the home. If in turn the home is priced too low, the owner will not realize as much of their equity as they should.
Not pricing the home in the proper search brackets could keep the property from being exposed to potential and likely, buyers. For example, if a home is priced at $399,000 to follow an age-old retail marketing principle, many of the most likely buyers will never know about it because they are searching for properties in the $400,000 to $450,000 range.
Just like the price, the seller also controls the condition of the property which affects not only the marketability of a home but indirectly, the price. If a home is in its best condition, the appeal is much higher to buyers because for the most part, they are using their available cash for the down payment and closing costs and may not be able to afford to make cosmetic or more expensive improvements to the property.
A little word however about clutter. Clutter can most definitely keep potential buyers from seeing your home, and more importantly, it will keep them from seeing themselves in your home – in other words, envisioning themselves as living in your home. There are three basic causes of clutter: there is too much stuff in the home; there is not enough space in the home; and there is no organization.
A key factor of selling a home is positioning it to sell which sometimes means temporarily or permanently getting rid of things that make the home look small or distracts the buyers from seeing its potential for them.
Financial preferences established by the seller are known as “terms”. In today’s real estate market where multiple bids are a great possibility, a seller may not have to offer any terms such as a financing, appraisal, or inspection contingencies. This will restrict the number of buyers who are financially able to pay cash and are willing to do so.
In regards to lower price ranged homes, there could be a great wealth of qualified buyers that need to use low down payment options, closing cost assistance from the seller, or other things. When the seller consents to offer a variety of terms, the market of potential buyers increases. The seller can still select the most qualified if they are not limiting protected classes.
The fourth marketing factor that the seller controls is the agent they select to represent them in the sale of the home. Selecting the “right” person to market your home is very important and worth careful consideration.
Think of a manager in a retail store. Your agent will be the manager of the entire marketing process. They’ll position your home to be competitive with the other homes in your price range and area while attracting the broadest range of buyers possible. Your agent will also offer advice on what needs to be done before the property is offered for sale. Your agent can also offer recommendations for a variety of service providers if work needs to be done.
Many professionals are involved in the sale of a home, including lenders, title officers, appraisers, inspectors, insurance agents, surveyors, and the buyer’s agent, just to name a few. Your listing agent will coordinate the communications between the other professionals and negotiate directly with them. Your agent’s role as third party negotiator is critical and you need to feel confident in their ability to serve your best interests.
- Too high; not realistic
- Doesn’t acknowledge Internet search range
- A poor location can negatively affect price
- Since location cannot change, must adjust price for a poor location
- Drive-up appeal
- Deferred maintenance
- Lack of updates
- Terms (applicable to certain price ranges)
- Buyer concessions like closing costs
- Incentives like home warranty, appliances, floor covering, etc.
- Buy-down interest rates
- The Agent you select
- Knowledge of neighborhood
- Promotional expertise
For more information, download our Sellers Guide.
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