This is Part II of a three part series. This section covers getting your home ready to sell, leaving negotiation room in the asking price, and whether or not you’ll need to have an Open House. Part I of this series covers determining your home’s value, online estimates, and the costs of selling a home. Read Part I. Part III of this series covers what to do if your house doesn’t sell, what happens after you’ve accepted a buyer’s offer, and what you’ll need to know if you’re planning on buying a new home at the same time that you’re selling your current home. Read Part III.
What Should I Do to Get My Home Ready to Sell?
Every home is different and each one needs a custom plan depending on the specific issues, available time, and budget. But, the most important rule is to focus on the things that will more than pay for themselves. You don’t want to make an update to your kitchen that costs $10,000 if it’s not going to be of any value to buyers and you won’t get a return on your investment.
As a general rule, you’ll want to do the things that will help your home show it’s best in it’s current condition. Unlike HGTV shows, you’re probably not going to remodel your home to sell it. Cleaning and organizing are going to be much better investments, be less time-consuming, and get you a better return than a major remodel.
When preparing your home for sale, you’ll want to clean and organize to show off the space and help your home feel as open as possible. A fresh coat of paint typically has the biggest impact and the best return for the time and cost. An experienced agent can help you determine the best plan of action for your home but you can almost always start with cleaning, de-cluttering, and organizing.
How Much “Negotiation Room” Should I Leave in My Asking Price?
No seller wants to leave money on the table and no buyer wants to pay too much for a house. Buyers also don’t want to have their offers rejected. It takes time and effort to make an offer and buyer’s don’t want to waste those on something that’s going to get rejected.
An asking price that’s too high is an obstacle to buying that’s difficult to overcome. I can’t tell you how many buyers I’ve seen refuse to make an offer on a great house only because the asking price is unrealistically high. The buying cycle is long. Most buyers have been looking at homes online for months to years by the time they’re actually ready to start shopping seriously (and ready to make an offer on a home).
By the time a buyer is ready to make offers on homes they’ve narrowed down their target neighborhood, price range, and wants/needs for their home. They are typically getting targeted listing alerts from 2-3 websites like Zillow and Realtor.com and they’re also getting alerts of listings that may meet their needs from their agent. With so much information, they have a very good sense of the value of homes in the neighborhood. They see what sells quickly and what sits on the market. They see how much homes are selling for. Most importantly, they can spot an unrealistically overpriced listing from a mile away and they don’t make offers on those homes.
The bottom line is that asking a fair price for your home will bring far more potential buyers than asking an unrealistic price. To maximize the number of offers, your asking price should be very close (often within 3%) of what buyers would be willing to pay for your home so that you don’t leave money on the table and to get the maximum number of offers.
Do I Need an Open House?
Open Houses aren’t likely to do much to help with the sale of your home, but they’re also not likely to hurt. Nearly every potential home buyer will find your house online. They’ve been looking for a while and they’re getting automatic updates of new listings that meet their basic criteria from a variety of sources. Since that’s the case, it’s nearly impossible for a ready, willing, and able buyer to miss a listing that may work.
Buyers who are ready to buy now, or within the coming weeks, will contact their agent to schedule a showing. No buyer will find the perfect house and skip it only because there isn’t an open house.For the most part, Open House attendees aren’t ready to buy now. Most visitors are getting a sense of the real estate market and want to look without having to go through the process of contacting an agent and getting a mortgage pre-approval. They simply aren’t ready to buy at this time.
Occasionally, a potential buyer visits an open house and decides to take the next steps of getting an agent, getting loan pre-approval, and making an offer. Since this is so rare, it’s often the case that another buyer has made an offer by the time the open house buyer is ready to make an offer. I’ve sold plenty of homes without ever having an open house. I’ve also seen plenty of homes go on the market and sit for weeks or months before having an open house.
Sellers often believe that the reason that the house hasn’t sold is that there wasn’t an open house. If access to the property has been an issue then this could be the case but most homes are easily accessible so it’s rarely the case.
An open house can hurt a potential sale. If an interested buyer comes to an open house and they’re the only visitor, which happens a lot, they will wonder why nobody else is interested in the home. This can easily prevent them from an offer. It’s similar to having passed on a restaurant because nobody else is eating there while all of the nearby restaurants are full.
This is Part II of a three part series.
Part III of this series covers what to do if your house doesn’t sell, what happens after you’ve accepted a buyer’s offer, and what you’ll need to know if you’re planning on buying a new home at the same time that you’re selling your current home. Read Part III.