Buying a Home Isn’t a Handshake Deal
Half the battle of selling a home is anticipating problems before they come up. Selling a home is a major life milestone, and it can be complex when you consider all of the steps involved, preparing and listing, making repairs, finding a buyer, navigating the closing process, and finally moving into your next place.
Not Interviewing and Seriously Comparing Agents for the Job
This may be the biggest mistake and easiest one to avoid! Many people think all agents are basically the same and that it makes little difference which one they hire. There are tremendous differences in quality of service, degree of experience, level of skills, amount of advertising, and extra staff support provided.
Please interview at least two alternatives before selecting one. Find out what the differences are by asking each one the same questions – and listen carefully to the answers and feelings behind those answers. We have a list of over 20 questions that can help in this process. Also, ask to see examples of marketing pieces the agent recently used.
Sellers may list their homes with a neighbor, friend/relative, or someone who knocked on their door without at least meeting with one or two other agents so they can be fully informed. They may put more effort into deciding which smartphone to buy or where to eat than which agent to entrust the responsibility of managing their largest asset!
Not all agents have the experience or resources to provide the highest caliber of service, and the results can be detrimental by $50,000 to $100,000 or more.
Selecting the Agent Who Suggests the Highest Price
This mistake often involves an owner’s attachment to an overly optimistic selling price for their home, which an agent may encourage or use to highly influence the agent selection process. The prospective seller usually makes the best agent choice based on the services, problem-solving, and negotiation expertise the agent can provide.
Once that decision has been made, the first important action will be to determine the best pricing strategy for the most effective marketing. Starting out on the basis of an over-inflated listing price may result in a failure to sell for many months.
Setting an Unrealistic List Price
Sellers often think they can rely on an online valuation system such as Zillow or Trulia, but they don’t realize that there can be a variance of 10-20% between them and that the online systems have limited information to utilize. Asking prices that are too high will fail to catch the attention of the most qualified buyers as well as serve to discourage some from even making an offer.
Listing as a Favor, Out of Guilt, or Feeling Obligated
Some people feel they have no choice but to list their house with a close relative or friend who has a real estate license. Others feel obligated to use the same agent they worked with years earlier when buying the home. Some think nothing of giving a listing as a favor to help someone out. These are not good reasons for hiring an agent.
Your home is probably one of your largest single assets. A difference in the sale price of 2-3% happens often, depending on the skills and experience of the listing agent. With average home prices over $2 million, this decision can easily cost a seller $40,000-60,000.
Choosing the Agent Who Offers the Lowest Commission
The old adage that “you get what you pay for” is often true in real estate. An agent who offers the lowest fee may simply feel he or she has no other way to compete for business.
If this agent discounts his or her fee by 10-15% upfront, how strongly will he or she negotiate for a client? How much supplemental advertising, time and extra services will the agent provide? The commission cost savings may result in an even greater discount in the sales price.
Not Hiring a Local Specialist
Some agents promote their services as being throughout the entire Westside of Los Angeles. Be careful! A local agent may have great advantages in marketing, networking, and negotiating. These could be important issues to factor into your decision process.
Basing the Price on a Neighbor’s Asking Price
This mistake often results in homes staying on the market for several fruitless months. An asking price is not the ultimate sales price and the basis for setting an asking price is by comparison with several actual sales, not just a price another owner hopes to get close to!
Not Doing Any Home Preparations or Pre-inspections
You never get a second chance to make a good first impression! Even in a “seller’s market” many homes do not sell, and often it is because of how they look or feel. It does not cost much to do basic “staging”, and it may result in a much better and quicker sale. Getting property pre-inspections done can greatly minimize hassles or concerns early in escrow, and also can potentially save the seller many thousands of dollars in credits or repairs.
Not Preparing the Home for Marketing – Especially for Photography
Most good agents invest in professional photography for their listings, but even a basic camera and editing is no substitute for decluttering, depersonalizing, and improving the flow of the interior. It is very important to present the property in its best light. The first experience most buyers will have with a home is on the internet via photographs.
If a home has not been properly prepared, it will show as such, and thus may result in a non-showing. Sellers will always have a better sale (less time on the market and more money) if they take the time to ask any agents they interview what their view and approach is to these issues, and what resources they will provide to help maximize the visual appeal.
Trying to Hide or Ignore Significant Problems
Hanging a large poster or decorative piece over a noticeable wall-crack or stain can backfire during inspections if/when discovered this can lead to a potential lawsuit after the buyer moves in if the hidden problem is more significant than a simple cosmetic issue.
Failing to disclose conditions about the property can result in a serious legal conflict. For example, a seller must let the buyer know if the sewer line needs regular maintenance/clearing, or put themselves at risk for a lawsuit when the situation is discovered.
Not Adjusting to Marketplace Results and Feedback
If other agents or their clients say that the house does not show well, or that it is over-priced as compared to other homes they have seen, it does not make sense to ignore this feedback. According to surveys, if a home has had over 10 showings and no offers, it is over-priced.
Being Emotionally Attached to the Outcome
Some sellers react negatively to an offer they feel is a “low-ball” and refuse to issue a response/counter offer. Others have a personal reaction when they feel a buyer is critical of their home or do not appreciate the improvements they have made.
Many escrows fail to close because the seller won’t consider doing any repairs or giving any credits toward problems discovered during inspections.