Personal Financial Tip 7

The time has come to sell your home. For whatever the reason, the home no longer suits your needs. Maybe you have a growing family and you need something bigger, maybe you’re an empty nester and need something smaller or maybe you’ve had some financial difficulties and can’t afford the expense of this particular property. You’ve made the decision now you need to get the job done.

Regardless of whether you are going to hire a real estate broker to market the home or you plan on doing it yourself you goal should be to sell for the best price in the most efficient manner. You can only do this by separating your emotional attachment to the home from the realities of the marketplace.

The home you’re living in has a special value to you. You decided to buy this home, you decorated it, it has been a part of your life and you may have even raised your family in it. No potential buyer is going to have these attachments to the property. A buyer, just as you did when you bought this home, will be comparing this property to everything else he’s seem. If he likes the property and it suits his wants and needs an offer will be presented. This offer will be based on the buyer’s personal evaluation of the marketplace and his evaluation of your home. In order for you to be equipped to respond to the offer you need to have a working knowledge of the local housing market.

You need to know which houses in your neighborhood have recently sold, for what price and when the closing occurred. You need to discover which other homes in your community are on the market and at what price. You want to be as knowledgeable as the buyer and recognize the fact there is no special add on to market price because your home is special to you.

It’s based on your knowledge of the market that you will negotiate. The only way you can properly negotiate the terms of an offer is by putting yourself in the potential buyer’s shoes. You need to know where he’s coming from. Without doing the necessary research you home will not sell at the proper price or worse, never even get an offer because your expectations are out of line with the market.

Once you have done your research you are now prepared to market your home. Keep in mind that this is going to be a job, it is going to be a major distraction in your life and it is going to require an investment on your part. You are going to be investing your most valuable asset, your free time. This is why it is important to sell your home in the most efficient way possible.

Once you have calculated a price that you can reasonably expect to get for your home you need to decide on an asking price. The theory that you should start high because you can always lower your price doesn’t work. You end up wasting time on the market and the longer your house in on the market the more likely buyers will assume there is something wrong with the property. This results in fewer buyers viewing your home and encourages them to make lowball offers, neither of which is a path to selling your home at the best price.

Let’s say that your research supports a sales price of $500,000 and you decide to put your home on the market for $700,000 figuring that you can always reduce your price and hope for the best. Think about it, individuals that can afford a $500,000 home aren’t looking as high as $700,000 and people looking to buy a $700,000 house are expecting more house for the money. When you overprice your house, you are marketing to the wrong set of potential buyers.

The closer to your targeted price of $500,000 you start your marketing at, the more activity you are going to get. The activity you get will be from buyers who are interested in buying in your price range. Now you are marketing to the right people.

You have also earned the right to be firm when you are negotiating with a buyer. Any serious buyer will recognize that you have priced the home properly and therefore expect to settle on a number that is close to your asking price. You have no reason to talk to any one presenting a lowball offer because you have the data to support your numbers. You have the freedom to pick and choose which offers you are willing to entertain.

After you’ve determined your asking price, the next step is to prepare your home. You are dealing with a buyers’ market. Meaning that there are a lot of homes on the market and buyers can be more selective in making their decisions. There are things you need to do to that will make your house more appealing. You don't need to spend a lot of money or drastically changing your lifestyle.

There in no reason to take on major remodeling projects, bring in an interior decorator to stage your property or totally depersonalize your home. Variations of these approaches are being suggested in “how to” books and the news media. My theory is “less is more”. The less you do to the home the more attractive it is to a buyer.

The first step is to do a general cleaning. Take the day-to-day clutter of family life and get it organized. Wash all the windows and adjust your window treatments to allow as much light into each room. The interior of the home will have a more appealing “feel” to it if it is organized and bright. Any opportunity to air out the house should be taken. Every day the weather permits, shut off the air conditioning and open the windows. Any closed space will begin to smell stale trapping any pet or cooking odors in the air.

Any damage in the home need to be repaired but upgrades shouldn’t be done. Repair the dripping facet in the bathroom but don’t remodel the bath. If the bathroom on the second floor is leaking into the first floor then remodeling may be appropriate but updating the bath because it’s 50 years old would not be a good investment. Replacing the stove in the kitchen because it’s not working is one thing. Replacing a working stove with one with a fancy nameplate on it is something else.

A suggestion that I come across a lot is to paint. A fresh coat of paint makes any room seem more appealing. If you feel a need to paint every room in your house, fine. If you are thinking about painting one or two rooms, don’t. Although those rooms will shine it will make every other room look more worn. In most cases you are better off not painting, unless you plan on doing the entire house.

Keep in mind that anything that is done to the property will look like it’s just been done. A potential buyer will assume that the only reason the work was done was for the purpose of selling the home. This raises a question in the buyer’s mind. Better the buyer see a 50-year-old well maintained bathroom than a brand new bath that looks like it was never used. The buyer will prefer to buy a home that presents itself as being well maintained yet dated over one that looks like it’s been cosmetically renovated for sale. Remember, any investment in the renovation will be in the sales price and the buyer is well aware of that.

The outside of the house is as important as the inside. Keeping the lawn moved and the bushes trimmed makes for the right first impression. This is called “curb appeal” in the industry. Be sure to keep the lawn well watered, lawns are expected to be green and that means plenty of water.

Lastly, the home needs to be accessible. Buyers won’t buy what they can’t see. The easier it is for people to come see your home the faster you will get is sold. Be prepared to be available on the weekends as well as in the evening.

It’s a tough market right now but houses are still selling. If you price it right, present it in its best light and make it convenient for potential buyers to see it, it will sell. You just may have to be a little patient.