Home Sellers Beware! Tips when selling
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It’s is no secret; inventory is low and we’ve got 12 buyers for every home on the market driving prices up.
Just because home sellers may receive multiple offers in this hot sellers market, does not mean the transition will close.
In fact, there is a rising number of homes that went under contract quickly, and having to go back on the market.
So how can you, as a seller, strategize for a successful home sale--and avoid these pitfalls and actually make it to the closing table?
Homeowners who are selling think a “hot” market means fast, easy money for their home. After all, the definition of a hot sellers market is low inventory combined with lots of buyers looking for the perfect place, right?
While it’s true, a hot market does mean a faster sale at or above asking price. I’m even seeing some pretty crazy contingency waivers as well.
However, there are some pitfalls that a home seller in a hot market needs to be aware of before watching the money roll in.
I’m seeing homes go pending (meaning under contract) in lightening speed these days. A home may only be on the market a matter of just a few hours in some cases.
But I’m also seeing a lot more homes quickly come back unto the market.
In some of these cases, it is because the buyer had a home inspection done and turned up repair items that ended up being a deal breaker for both sides.
Now the seller has to put the home back on the market.
No doubt, potential new buyers are going what to know what happened..essentially having the question in their mind “what's wrong with this house”.
As a seller, this stigma could effect your bottom line now.
To avoid this, Consider getting an inspection done before listing your property so you can present an accurate picture to buyers from the get-go. Yes, a home inspection will cost you around $350.
In my opinion, it’s money well spent opposed the risk and Costs of dealing with the unknowns.
Get a Title Search Commitment
OK, the home inspection is perfect and your buyers are anxious to close.
But there’s a title problem, and it looks like it’ll take a bit of time to clear up.
Your buyers don’t want to wait, because they have deadlines too..so, here you go again..Got to put your home back on the market.
In most states, the time frame for having the title commitment is clearly addressed in the purchase contract.
But do not wait until your have a buyer to have this done. Do this immediately once you list your home. The Title company or attorneys office handing the closing is responsible for providing this service, and you won’t have to pay for this until your property closes. Turn to your Realtor for advice.
In most cases, the homeowner is totally unaware of any title defects. Especially if you are selling a home you inherited, or have special circumstances stemming from a divorce. There are many reasons why a title commitment may not be issued initially.
The good news is, most all title defects can be corrected.but may take time.
Another thing I’m seeing a lot of in this hot sellers market is FSBO’s.
As a homeowner is a hot sellers market I totally understand the impression is that buyers will flock in groves and there’s no need to pay the Realtor commission fees.
I’m a fully licensed Realtor and I fully agree with this. Yep, in this sellers market , it’s incredibly easy to simply walk out unto your front yard, put a sign up... and before you you make back inside, your phone is ringing!
It’s what happens next that gets most FSBO’s in trouble.
If you , as the property owner, are not familiar with how to write, negotiate and defend a real estate contract, especially a Florida Real Estate Purchase Contract, you are setting yourself up for one huge headache..Not to mention time lost with unqualified buyers and worse...actually not netting every dollar your home is worth.
I cannot go into all the reasons why selling by owner is Not a good idea in this market in this video, but if you’d like to schedule a chat, Just click 15withLisa link. Choose a day and time that best for you. I’d love to talk to you!
Being in a hot sellers market, a seller has a better chance of selling “As-Is” without having to make major updates.
However, Depending on the price range and neighborhood, it’s best to have a discussion with a local seasoned Realtor who is familiar with your area, to determine whether or not you should make any significant improvements before you put your home on the market.
It could mean the difference of potentially leaving some your hard earn money and equity on the table.
‘Staging’ Is Not Personal Home Decor
On the flip side, home staging, is highly recommended even in a sellers market.
Most homeowners do not realize there is a huge difference between home staging and home décor.
In a hot market, buyers need to move quickly and are driven by first impressions and emotions. There is no better way to make someone fall in love with your house than to stage it.
If a home is properly staged, a buyer will automatedly envision themselves in the space and will act much more quickly, opposed to a home that has been decorated by the current homeowners personal effects.
If you can’t afford to stage, at the bare minimum the property should be de-cluttered and cleaned.
If you choose not to stage, please take the time to watch my 3 part series on how to declutter your entire house in 30 days. I break it down to easy, very doable daily tasks most anyone can do.
One of the most common things I’m seeing as the reason why a home was previously pended and now back on the market is because the seller chose an offer that was too good to be true.
Buyers are under tremendous pressure these days, and sometimes (unintentionally) make promises in their offers they cannot keep in order to take the home off the market while they diligently try to make good on their offer.
For example: You received an offer for $10,000 over list price and the buyers are willing to have a flexible close date to give you time to move. An offer from heaven...and you couldn’t sign the agreement fast enough!
Everyone is happy, the home inspection went well, buyers are getting their paperwork into the lender...Life is good.
Then the appraisal comes in right at list price. But your purchase contract is for $10,000 above list price. That means the buyer will need to come to closing with additional $10,000, or the seller would have to agree to adjust the purchase contract to reflect the appraised value amount.
If neither party agrees to negotiate a remedy, the contract fails. Your home that has been off the market for 2 weeks, now has to go back on the market.
Don’t get caught up in choosing the wrong offer, just because it looks like a dream on paper.
An experienced Realtor will know how to best advise you by vetting all the buyers, wording your contract to protect your best interests and offering you guidance based on your individual circumstances and goals.
When you receive multiple offers and one is chosen, please make sure your Realtor kindly responds to all the other offers that you’ve made a choice but are thankful for the other offers. Not only is this professional courtesy, it also bridges your relationship with that potential buyer...Just in case....
Just because the market is hot does not guarantee multiple offers for over asking price.
Sure, you’ve heard about the house down the street that sold in two days for $20,000 over asking. But you do not know all the circumstances surrounding that sale.
House prices can differ drastically within neighborhoods. Criteria that isn’t readily apparent on the MLS or past sales might make a property sell for more:
Like a great layout, lots of light, decorator colors, or mature fruit trees. These are all examples of things that might tip buyers into a frenzy that creates high prices and multiple offers.
Your home might not offer these. Take solace in the fact that you are selling in a hot sellers market and are more likely to sell for your asking price opposed to selling in a down market.
And, if you happen to luck out and your sales proceeds are more than you ever imagined, feel free to pop the champagne at closing!
I’m Lisa Kelly Lakeland Homes and Lifestyles with Premier Realty. Until then, I’ll see you on the next one.