Greetings and happy spring!
The Twin Cities real estate market is experiencing another active spring market and is buoyed by several stabilizing factors: Interest rates remain stable with the rate for a 30-year fixed conventional loan around 4.00% – 4.5%, the unemployment rate in the Twin Cities remains one of the lowest in the country at 4.2% and most anxiety surrounding the transition to a new administration in DC has subsided. The same trajectory of the market has continued since 2013 which is driven by high buyer demand coupled with low listing inventory. In my last edition, I focused on the home buyers but in this article I’d like to focus on the selling side of a transaction.
While buying a home should be a fun and exciting experience, selling a home can be nerve racking, time consuming and frustrating. I have found, as a home seller, that if you focus on a few items and do them well it does not need to be a painful experience. The key items of focus are pricing, staging, marketing and negotiation.
Proper pricing is vital, regardless of the market. Some homes are easier to price than others. The primary factor is comparable sales, or lack thereof. If there are numerous sales of equivalent homes in the subject area, pricing is much easier than a completely unique home on a unique lot. Pricing a home too high is a common mistake and eventually leads to a lower sales price. There are a multitude of aspects that influence price, too many to list on this post. Because of this, pricing is challenging and should be done by a professional.
Staging is all about first impressions. If you don’t wow a buyer immediately they will move on to the next listing (and will most likely never look back). This includes how a home is viewed online as well as in person. These days a home must look good online. This means having great pictures taken by a professional when the home is looking its best. The next impression for a potential buyer will be when they enter the home. Subliminally, buyers make a quick judgement when they enter a home, so if a buyer is turned off by how is looks, smells or “feels” they probably won’t be interested in making an offer. To avoid this I recommend decluttering your home and having a consultation with a designer to identify affordable ways to maximize your home’s value.
Marketing is another aspect that can have a huge influence on sale price. There are so many aspects and nuances that encompass marketing I could write an entire article on the topic. In short, it is essential that you have a well-designed marketing plan geared to your specific home. Marketing real estate is not a “one size fits all” endeavor; it must be customized and specific to your home. I have found that if you have a well-designed marketing plan and stick to it you will have positive results.
The last step, after you receive an offer, is the negotiation of terms. This is the culmination of all the time and hard work you have done in listing your home. As such, there is a lot on the line. Done effectively, good negotiations can lead to a better price and terms than a seller expected. Done poorly, a seller may get less than the home is worth with unfavorable terms or cause a transaction to fall apart completely.
There are other items that must be done when selling a home. These include correct disclosures, documentation and city/state/federal compliance to name a few. Real estate transactions have become increasingly complex, evidenced by the constant increase of paperwork involved. Being on top of compliance and disclosure details probably won’t help sell your home quicker or for more money, but they will keep you out of legal trouble down the road.
Everything I have highlighted above are matters on which a skilled Realtor can advise you. I caution anyone against trying to sell your own home or hiring an agent without fully vetting them. I have seen too many situations where a sellers think they will save money by selling themselves or using a discount broker, only to lose more money than is saved at the closing table or they end up in a legal dispute. The old saying “you get what you pay for” certainly applies to real estate.
While selling your home can be challenging, by taking the correct steps with good guidance you can minimize the pain and maximize your profit.
Happy home selling!