Sacramento Real Estate Blog

A friend of mine asked me yesterday about giving her tips for home sellers. Okay, technically the tips were not for her - she hosts an HD radio show and I was called in as the real estate expert but you’re not interested in shameless plugs right now, are you? Suffice it to know that I was left thinking about common home seller pitfalls that occur which essentially hurt the sale of a home very often. The unfortunate thing is that sellers sometimes have no idea they have actually caused the home buyers not make an offer. And some of these pitfalls are so easily avoided and / or fixed. So I want to dedicate a series to them. Home sellers, listen up!

Not Listening to your Realtor®

Maybe this should have come in last. I don’t like making a plea that requires you to trust someone right at the outset, but I think in this troubled housing market it is necessary. Many sellers desperate to sell in this real estate market won’t be able to. Unfortunately, that’s just the truth. The number of bank-owned homes out there are mind-boggling. Not to mention the fact that they are priced at outrageously rock-bottom pricing. Even if the intent is to get multiple offers and hence drive up the actual selling price on these homes, they are nonetheless your competition. So listen to your Realtor®. Ask him to use all the tools at his disposal: first, to give you an idea of the absolute truth about the real estate market today and then, to market your home in the best way possible to get a home buyer who will not just make an offer, but actually follow through and buy the home - YOUR home.

Realtors® are professionals who have to sell homes for a living. If there is a Realtor® in business today, chances are she is good at it. Since we don’t get paid unless and until a home sells, it is impossible for Realtors® to stay in business unless they are aware of the current market and are able to guide buyers and sellers through real estate transactions and to a successful close. So listen to your Realtor®. Chances are she has been there before.

Not Pricing a Home Right from the Outset

In a better real estate market the strategy of let’s-price-it-high-and-see used to work. Today, you couldn’t come up with a worse idea to sell your house. When a new listing comes on the market, it shows up with a “new” tag in the MLS and immediately gets emailed to anyone who is looking in the area in that price range. If it isn’t priced right, you’ve missed your buyer base completely! Sure, when the price drops it will still remain under current listings that match the prospect’s criteria, but then it isn’t a new listing any more. And, believe it or not, I still get asked the question, What’s wrong with it that it’s been on the market so long?

Why not price the home right from the beginning? It creates excitement - even a sense of urgency in the mind of the buyer that they might be competing against other buyers. And a sense of urgency leads to sales, as any Christmas shopper today will tell you. Much better than letting the home languish on the market and then just be grateful to receive an offer, any offer. One caveat, however: the price you think your home is worth might not be its market value in today’s market. Be prepared for the truth.

Ignoring your Competition

This seems like a repetition of the previous point, but it’s not. That’s because I’m giving you specific advice here: when you look at the CMA (Competitive Market Analysis) that your Realtor® hands you, be sure to look at not just the sold properties, but the active listings as well. When the market is going down, it makes little sense to look at the sold comps and base your price on them.

When the market was headed up, sellers considered the sold homes, then priced their houses 3% - 5% higher than the latest sold comp and got the price they wanted. Unfortunately for you we must do the opposite today. Keep an eye on the sold prices of homes and then take a look at the active listings. Chances are your home will sell somewhere in line with the sold comps, but your competition when your listing is on the market are the active listings. Most buyers don’t look at the CMA until they want to make an offer. What they consider first is the relative price of the listing with regard to the others on the market. If you price your home like the solds, you will miss out on the pool of buyers looking for a bargain home and your listing may stay on the market longer, until it’s time for a price reduction. In reality, you will be following the market down.

That’s it for today. This is part of an ongoing series, so do come back to read more common home seller pitfalls. Sellers in this market need all the help they can get! And with the holidays approaching people walking through your home are quickly dwindling into shrewd bargain hunters or simply tire-kickers. So make every day your home is on the market count. Avoid these pitfalls. Get your home sold. And if you need to sell fast, give us at Elite a call. Our professionals will be glad to help!