6 SELLING MISTAKES YOU DON'T WANT TO MAKE!
Mistake #1 -- NOT GETTING YOUR HOME INTO TIP-TOP PHYSICAL CONDITION. The most common mistake home sellers make is they fail to get their homes into the best possible physical condition before putting the house on the market
In spite of how frequently this mistake is addressed and how simple it is to avoid, its prevalence is still widespread. When attempting to sell your home to prospective buyers, do not forget to make your home look as pleasant as possible. Make necessary repairs. Clean. Make sure everything functions and looks presentable. A poorly kept home in need of repairs will surely lower the selling price of your property and will even turn away some buyers.
To illustrate, before putting my personal residence on the market with a crack in the basement wall, I had a basement wall contractor patch the wall and guarantee it against future leaks. My investment in this project was less than $200 but the rewards were several thousand.
Mistake #2 -- Trying to Sell to "Looky-Loos" & ATTEMPTING TO SELL YOUR HOME WITHOUT A PROFESSIONAL REAL ESTATE AGENT
A prospective buyer who shows interest because of a "for sale" sign he saw may not really be interested in your property. Often buyers who do not come through a Realtor are a good 6-9 months away from buying, and they are more interested in seeing what is out there than in actually making a purchase. They may still have to sell their house, or may
not be able to afford a house yet. They may still even be unsure as to whether or not they want to relocate.
Your bigger handicap as a FSBO will be you have only one home to sell whereas real estate agents have hundreds of homes to show their prospective buyers through our local MLS (multiple listing service). The MLS is the most powerful sales tool the real estate agents have. All you have, as a FSBO, are (1) a for sale by owner sign on your front lawn, (2) newspaper classified advertising, and (3) perhaps some flyers posted on supermarket bulletin boards.
Some FSBOs think they will get the best of both worlds by agreeing to cooperate with local real estate agents and pay an agent who produces a satisfactory buyer one-half of the customary sales commission— 3% in our example if 6% is the full normal sales commission. But few, if any, realty agents will work to sell a FSBO house for half of a commission, especially in the current market. There are so many listed homes for sale where there is no problem of cooperation as the house is already listed for sale by a professional agent. In other words, the FSBO seller is at a severe disadvantage competing with the hundreds of homes available for sale through real estate agents—a promise of one-half the normal real estate commission to a real estate agent who produces an acceptable buyer isn’t enough of an incentive to an agent unless your house is bargain-priced, unique, very desirable, or has other features all the hundreds of MLS-listed homes don't have.
Mistake #3 -- FAILING TO CONSULT YOUR TAX ADVISOR BEFORE PUTTING YOUR HOME ON MARKET. Another major mistake many home sellers make is they fail to consult their tax advisor before selling their house. Only after the sale is complete do they learn the tax mistakes they have made. For example, I recently talked to a senior citizen home seller who learned she disqualified her new husband (it was a second marriage for both) from claiming his $125,000 "over 55 rule" home sale tax exemption on the sale of his house because she used her exemption when married to her late first husband. In tax talk, she is a "tainted spouse." If only she and her husband had consulted their tax advisor before the wedding they could have avoided this tax problem by selling the husband's home before the marriage!
Mistake #4 – BEING GREEDY. Although many home sellers would be happy to receive a purchase offer in today’s market, there are many others who will sell only if they get virtually their full asking price. In other words, these sellers are not highly motivated to sell. Some insist on getting every last dollar of profit from the sale. Usually these people lose out and either get no sale at all or they eventually sell for much less than their asking price.
Homeowners who have owned their homes a few years and have huge profits due to appreciation of the housing market are often the most difficult sellers of all. Instead of being satisfied with perhaps a $30,000 net profit, they insist on getting a $35,000 profit by counteroffering a perfectly good purchase offer. If the buyer won't meet the counteroffer, then the seller loses out completely. As my mother used to say "It's not worthwhile chasing the last dollar of profit." For example, when I accepted that $256,000 purchase offer on the house with a $259,000 asking price, I inquired of the selling agent if he thought the buyer might agree to pay more. He said she was willing to try. That told me the buyer would probably pay more. But then I stopped being greedy, realizing that I already would realize a very handsome profit. It wasn't worth chasing the last dollar of profit and risk losing that buyer.
Mistake #5—FORGETTING YOUR CLOSING COSTS. As part of their full service, your real estate agent should prepare an estimated statement of net sales proceeds. Depending on the buyer's purchase offer the agent will show you how the down payment and mortgage loan proceeds will be disbursed, such as to pay closing costs for title insurance, transfer taxes, sales commission, attorney and escrow fees, mortgage loan fees, fix-up costs, recording fees, mortgage interest adjustments for the month of sale,property tax pro-rations. Of course, you won't have to pay all these charges but you should consider closing costs when estimating your net sale proceeds.
Mistake #6 -- Pricing Your Property Too High
Every seller obviously wants to get the most money for his or her product. Ironically, the best way to do this is NOT to list your product at an excessively high price! A high listing price will cause some prospective buyers to lose interest before even seeing your property. Also, it may lead other buyers to expect more than what you have to offer. As a result, overpriced properties tend to take an unusually long time to sell, and they end up being sold at a lower price.
SUMMARY. Home sellers can ease their residence sale by committing the 6 major mistakes many home sellers make. By carefully planning the home sale and hiring a successful real estate agent to guide the sale, selling a home can be a pleasurable and profitable experience.