10 Mistakes to Avoid When Selling Your Home

10 Mistakes to Avoid When Selling Your Home

10 Mistakes to Avoid When Selling Your Home

Selling a home is no easy task, both in terms of the actual logistics and the emotional connection you usually have with the home.

After all, the average seller reports living in their home for about 14 years before selling, according to the 2021 Consumer Housing Trends Report from Zillow Group.

While most sales won’t go 100% smoothly, there are some common home selling mistakes you can avoid to help take the stress and emotion out of the process.

Knowing what to look out for will make all the difference whether you’re a new seller or have been through this process before. Here are the biggest mistakes when selling your home:

  • overpriced
  • incorrect timing
  • Neglect of maintenance
  • become emotional
  • not doing enough preparation
  • no photographer
  • lack of landscaping
  • no extra cost
  • Not knowing your own strengths and weaknesses
  1. Overpriced your home

  • One of the most important steps in selling a home is finding the right price—the price that will allow you to sell it in a reasonable amount of time and at a profit you are comfortable with.
  • The Risks of Overpricing Your Home
  • A common pitfall when listing your home for sale is giving in to the temptation of an exorbitant listing price. The reasons are as follows:
  • It blocks qualified buyers in your price range.
  • It can keep your home on the market longer. And the longer your home is on the market, the less buyers will feel they need to make a quick bid.
  • If you end up having to drop your price, buyers feel like they have extra negotiating power.
  • If your listing is outdated, you could end up selling for less than what you priced appropriately to begin with.
  • Determine the right listing price
  • Sellers can determine an accurate listing price in a few different ways.
  • Get a CMA from an agency

A comparative market analysis, or CMA for short, is an estimate of your home’s value, compiled by a local real estate agent. Their analysis is based on similar homes that have sold recently, and they often offer this service for free to earn your business.

Collect music by yourself

If you are not working with an agent, you can do your own compensation research. Use Zillow’s “Recently Sold” filter to identify homes similar to yours that have sold within the past three to six months using the following criteria:

  • same block
  • Similar size (within about 300 square feet)
  • Same property type – apartment, house or townhouse
  • Similar condition or upgrades (if you have hardwood and your home has vinyl floors, you’ll want to adjust that)

Hire an appraiser

If you’re selling in a particularly competitive market or you need a quick sale, it may be worth the $500 to $700 a professional appraiser charges to get an expert opinion on your home’s value. An appraisal report can give you peace of mind about your chosen price and can be a handy tool in negotiating with buyers.

Don’t worry about under pricing

Sellers are often concerned about under pricing, but overpricing is a bigger problem. Under pricing is actually a tactic agents use in hot markets, as a lower asking price can attract multiple buyers and spark a bidding war. You may end up selling for more than market value simply because of demand.

  1. Selling at the wrong time

The timing of your sale can make all the difference in the price you are able to fetch. In most places, the best time of year for sales is late April. The typical US home listed in this window sold for $9,300 more than the average point for the year. Weather can be a factor in your city’s sales window, so keep that in mind when researching the best sales times in your area.

Another time-related issue you have to keep in mind has less to do with the month of the year than with how long you own the house. To avoid paying capital gains tax on the sale of your principal residence, you need to have lived in the home for at least two of the past five years.

  1. Save maintenance costs

Even minor flaws can put buyers off. If they walk by your home and notice a loose doorknob, leaky faucet, or dent in the wall, they’ll wonder if you’re also overlooking bigger problems in your home.

According to the Zillow Group 2020 Consumer Housing Trends Report, the average seller makes 2.3 renovations or improvements to prepare for sale, and 79% of sellers make at least one home improvement. The most common projects included painting interiors (35% of sellers), landscaping yards (28% of sellers), improving kitchens (24%), replacing or repairing carpet or flooring (24%), and improving bathrooms (27%).

Option 1: Precheck and Correct

Sellers sometimes choose to pay a pre-flight fee. By hiring an inspector to look at the listing before it’s listed, you can set a more appropriate sale price and stop potential problems before buyers notice them. If you are able to complete repairs before buyers set foot in your home, your home will appeal to those who are looking for a turnkey, move-in ready home.

Sometimes it is more cost-effective to have repairs done before listing than to wait for buyers to discover the problem and try to negotiate a closing credit. For example, your HVAC system may only need a few new parts, but a buyer may want you to replace the entire system. You also have control over the contractor selected, costs and materials used.

Average cost of most expensive home repairs

While many home repairs are cosmetic in nature and fairly inexpensive, sellers are sometimes unprepared for the big issues that need to be dealt with before listing. Here are some common costs for the most expensive major repairs:

  • Plumbing: $7,000
  • New roof: $6,200
  • New driveway: $4,000
  • Exterior paint: $3,500
  • Windows and doors: $600 to $900 per window, plus $100 per window to remove old windows
  • New furnace: $2,300
  • Electrical: $2,000
  • Carpet and flooring: $2,000
  • Deck: $2,000

Option 2: Offer Repair Credits

When there are known issues with a home (whether because of a previous pre-inspection or because buyers discovered some issues during their own inspection), one way to help move the deal forward is to offer repair credits, which allow buyers to complete Repair yourself after shutting down.

Solution 3: Lower the listing price

If you discover issues with your home before listing, you can lower the listing price in the first place. Note that some buyers may still try to negotiate a lower sale price, so make it clear in your listing description that the listing price reflects a known issue.

  1. Let emotions interfere with your home sale

To successfully sell your home, it’s important to separate your emotional connection to the home from the details of the deal. It can be difficult to negotiate with buyers when you love your home, but it’s important to act like a professional.

Emotional Mistakes: Negotiating on Your Own

Try to keep a level head throughout the sales process, especially during important negotiations. Be realistic and assume that at least some problems will be found during a home inspection. No home is perfect, especially an older one. Don’t let minor repair requests from buyers ruin the whole deal.

You know all the TLC you’ve put into your home, but that doesn’t mean it’s something a particular buyer wants, nor does it necessarily add actual value to the home. For example, if you do-it-yourself an interior paint job but the buyer wants it redone by a professional, don’t take it as a personal insult to your painting skills.

Emotional Mistakes: Failed to Adapt to Acting

Multiple inspections and the occasional open house are just part of the home selling process, even if they’re inconvenient. After all, few buyers want to buy without seeing it! If you have an agent, they should coordinate showings or provide a lockbox for the buyer’s agent to take a tour (sometimes you’ve already agreed, of course).

When buyers tour a home, be sure to move out of the house and bring your children and pets with you. Having sellers present can make buyers uncomfortable. You want buyers to be able to imagine themselves living in the home, and it’s hard for you to observe this from behind them.

  1. Not getting ready and staged

Trying to keep your home in tip-top shape before listing is worth the time and money, especially considering buyers may be bidding based solely on what they see on the screen. In fact, nearly 60 percent of millennials in a Zillow survey released last year said they would at least somewhat confidently bid on a home after taking a 3D virtual tour.Use the following home selling tips to clean, prep, and furnish your home, and try these tips to boost your home’s screen appeal.

  • thoroughly clean
  • Vacuum, sweep and mop.
  • Polish or wipe down appliances and countertops.
  • clean bathroom.
  • Eliminates odors.
  • Fold and put away laundry.
  • Keep your closets organized (buyers love storage space).
  • Repeat this process before each showing.

Depersonalize, organize and stage

As mentioned above, it is important that buyers can imagine themselves living in the home. This can be a daunting task when your items are everywhere. Here are some tidying and staging tips:

  • Rent a storage room at a friend’s house or store personal belongings.
  • Move things room by room. The fewer items in a room, the more spacious it will feel.
  • donate! Decluttering a home sale is the perfect time to get rid of unwanted stuff and reduce storage and moving costs.
  • Remember, buyers don’t necessarily own your style. Keep decor to a minimum and rearrange furniture in a neutral and functional way. If your home furnishings are very special, consider hiring a professional staging crew to help you attract more buyers.
  • Stage room with wide appeal. For example, your guest room is more like a guest room than a home gym.
  • Consider painting the interior. A fresh coat of paint can refresh every room. This is even more important if your room features a bold, unique wall color that won’t appeal to most buyers.
  1. 6. Not hiring a professional photographer

Many real estate agents will pay for professional photos, but even if you don’t use an agent, professional photos are a must. After all, the majority (95%) of buyers search for a home online, and listing photos are your first impression of a home.

Most professional photographers charge only a few hundred dollars and produce crisp, clear photos with plenty of natural light that accentuate your home’s best features.

  1. Skip the curb appeal

When potential buyers come to inspect your home, the first thing they see is the exterior. Don’t spend so much time preparing the inside of your home that you forget about the outside. According to Zillow Group’s 2020 Consumer Housing Trends Report, 28% of sellers landscaped their landscaping in some way before listing. Common landscaping tasks include:

  • mowing the lawn
  • Paint exterior (if necessary)
  • clear path
  • Seasonal maintenance such as raking leaves and pruning shrubs and branches
  • grow flowers
  1. Forget about closing costs

One of the biggest home selling mistakes you can make is forgetting to include your closing costs in the profit you make on the sale of your home. Transaction costs for sellers can be as high as 8% to 10% of the sale price. Your overall closing costs are made up of several different items:

  • Commission: The seller typically pays 6% of the sale price – 3% to the seller’s agent and 3% to the buyer’s agent.
  • Transfer Tax: Also known as title fee, this is a tax imposed by your state. Rates can vary by state and also depend on the sales price of the home.
  • Title Insurance: Sellers will often purchase title insurance for buyers to protect them from any liens or home ownership disputes. Fees can range from $1,000 to $4,000.
  • Escrow Fees: Escrow services hold funds throughout the transaction and are paid appropriately at closing. These fees are usually split between buyer and seller and can range from $500 to $2,000.
  • Prorated Property Taxes: You will be responsible for paying property taxes on the home by the closing date, which usually results in a prorated fee at closing.
  • HOA Fees: Again, you must pay a prorated HOA fee.
  • Advertising costs: If you’re selling your home yourself, you’ll have to pay for any advertising, such as online ads, flyers, and signage.

Attorney Fees: If you hire an attorney, you must pay their fees. In 21 U.S. states (and Washington, D.C.), you need to hire an attorney for real estate transactions.

These states include Alabama, Connecticut, Delaware, Florida, Georgia, Kansas, Kentucky, Maine, Maryland, Massachusetts, Mississippi, New Hampshire, New Jersey, New York, North Dakota, Pennsylvania, Rhode Island, South Carolina, Vermont, Virginia and Western Virginia.

  1. Not hiring an agent (if you don’t want to do the work)

Unless you have the time, dedication and expertise to list your home for sale by owner (FSBO), you are better off using an agent. According to Zillow Group’s 2022 Consumer Housing Trends Report, only about 8% of sellers are opting for a home owner sale (FSBO).

Another 17% of sellers did most of the work themselves, but ended up hiring an intermediary to close the sale. Here are some key benefits of hiring an attorney:

  • Your attorney will handle the multiple pages of paperwork required.
  • Your attorney minimizes stress and helps you focus on facts, not emotions.
  • Agents have expertise in your local market and buyers’ needs.
  • They’ll use a comparative market analysis to set a price for you.

Make sure you have selected the correct proxy. The person you choose should know the local market inside out and have experience selling homes near you.

To find a great surrogate, read reviews, get recommendations from friends and family, interview multiple surrogates, and set expectations. Also, negotiate! Slightly more than half of sellers do not negotiate terms with their agents, but of those that do, 55% succeed in some way.

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