Tips and Tools to Help You Get Your Home Sold

Why do Realtors keep pressing price?  I know that there is this perception of agents as self serving and just looking for a commission.  But is that it?

I discuss the importance of price here often.  Maybe the reason that they keep telling you that your home is worth less than you think is because, in many cases, it is….

Zillow recently posted a fabulous article and the results of their Quarter 3 Homeowner Confidence Survey asking consumers their perception of their homes value over the course of the last year and expectations of values for the coming months.  The survey took place October 7-9, one of the worst weeks on the stock market in U.S. history.

The following is an excerpt from that article:

The results — kind of baffling. While the perception gap did narrow, still half of U.S. homeowners do not think their home’s value has declined over the past year. Specifically:

• 32% think their home’s value increased in the past 12 months
• 17% think their home’s value held steady
• 51% think their home’s value declined

In reality, three-quarters (74%) of U.S. homes lost value in the past 12 months, according to Zillow’s Q3 data.

So what’s my point here?  Maybe, possibly, your perception of the value of your home may vary from the reality of the market.  Just something to consider.

11/7/08 Update:  I came across this article tonight on MSNBC and thought this was an interesting addition to the conversation. 

Just in case you’re lulled into thinking that agents and sellers have gotten the message about the importance of great photography in a listing, I thought I’d share with you some samples of the worst from the Orange County area (my service area).

Well, I Should Hope So!  If I buyer would think, ‘Well, I should hope so,’ when viewing the photo, I suggest skipping it.  Doors, laundry rooms, corner of rooms, and toilets fall into this category.  Unless the door is some incredible upgrade or the bathroom is remodeled, it falls into the category of basic expectations.  Actually, I’ll go out on a limb and do more than suggest; please, do us all a favor and skip it.

Remember, a photograph should inspire some emotion, intrigue and ultimately (of course) the desire to come see your home in person.  Ask yourself, do any of these do that for you?

The best photo I found today will serve as the Grand Finale.  It’s my fav.  I don’t even have a category for this one.  Do you remember when you were a kid and you played that game with photos in a magazine or on television?  They show you some small part of the overall image and you have to guess what it is.  This photo reminds me of that game.  Took me a few minutes to guess what I was looking at.  Do you see it?  And, more importantly, if you are interested in seeing this home, feel free to give me a call and I’ll arrange the showing right away.

Making your home accessible and easy to show is something I’ve mentioned before, but it bears repeating.  Why?  Let me share what it’s like to set up showings through the eyes of an agent.

Monday, I planned to show some 4 properties in Irvine, California to some clients that were coming in from out of town.  On Sunday, I mapped out my showings, put together the schedule, and sat down to call the four sellers to let them know I wanted to show their home.  Easy, right?  More than plenty of notice, right?  It turned out to be far from easy.

Let me break it down for you:

Property 1: The showing instructions read, ‘Appointment Only‘ and ‘24 Hour Notice Required‘.  Huh?  This was an owner occupied home.  24 hour notice?  What the heck for?  There were two small dogs on the property when we got there so clearly, it wasn’t to get them out.  I had to call the listing agent, who had to call her seller, reach them, get approval and then call me back.  Thank God I actually had 24 hour notice from my buyer.

Property 2: The showing instructions read, ‘Restricted Access - Call the Listing Agent‘.  Inconvenient, but okay, I can do that.  I left a message Sunday afternoon and again Sunday night.  I left another message Monday morning.  No response.  Okay, now I’m started to sweat.

The remarks to agents in the listing on Property 2 say, ‘Easy to Show.  Call (name) at (number) for showing instructions.‘  I will share a secret with you… that ‘Easy to Show‘ line is almost always the kiss of death and actually means ‘Damn Near Impossible to Show‘.

I call the listing office to plea my case.  They assure me that they will release an all points bulletin in an effort to find Mr. ‘Easy to Show’.  About two hours before my Irvine tour, I get the call - ‘No problem.  Go ahead and go.  They’ll leave out the lockbox.‘  Wow.  Thanks.

Property 3: Scheduling this showing was a gift to soothe my nerves.  The showing instructions simply read, ‘Call First‘ and listed the homeowners number.  Cake.

Property 4 (and my favorite): The showing instructions read, ‘Appointment Only.  Call First,‘  and additionally, ‘Please call first and make an appointment at (number).  Seller to control lockbox.‘

Not as easy as Property 3, but no problem.  I call Sunday - twice, and again Monday morning.  Sweating.  This line is ringing with no answer and no opportunity to leave a message.  The Real Estate Gods are testing me.

Finally, three hours before my tour, someone answers.  The person I’m trying to reach is out of the country! When I tell her I want to show this agent’s listing she says, “Call back in 20 minutes.”  WHAT?!  I call back twenty minutes later and someone else answers and says that, “Yes, go ahead and show it.“  Good grief!

Obviously, this was stressful and time consuming for me.  In this instance I had a client specifically looking for these 4 homes.  Would I have tried this diligently to show these homes otherwise?  Certainly not.  There are so many options on the market that are significantly easier to get into.

And why all these hurdles?  Don’t you want a buyer to see your home?  This is not the time or place to play the dating game of ‘hard to get’.  I only want to sell your home.  I’m not a circus animal and I won’t always jump through hoops of fire to show your home.  Come on people, just let me in!

There is no question that staging can be an expense - but it may be one expense that is worth every dime.

In many areas of the country, prices are currently declining.  If you list your vacant home and it languishes on the market for 90 days, even 6 months, values may very well have dropped the amount that you would have spent on staging at the outset - the very staging that would have allowed you to achieve a swift sale.  The question should be, can you afford not to stage your home?

I found a perfect example of staging and fresh paint creating the very warmth and emotion that inspires a buyer to write an offer.  David Peterson, of Synergy Staging in Portland, Oregon wrote a post with exceptional before and after photos that you must see to believe.  When looking at his work in these photographs, ask yourself the following question: If I was a buyer, which home would I ask my agent to take me to see?

I recently had a reader leave the following comment looking for some direction and a solution:

Hi,

Your ‘about this site’ said you would like to hear from sellers who are struggling.  Here’s my story.

I am building a new home, so I HAVE to sell (technically I qualify for both mortgages, but it’s not exactly something  I can do for any length of time).  My current home has been listed for 120 days, with an agent.  We have had about 6 private showings, and dozens of open houses with ZERO traffic and zero offers.

My agent says that all the other agents are experiencing the same thing.  My home is unique in the area, so comparables are difficult (it’s rare to find a 2nd bath and a 2 car garage in the area).  My agent did a market analysis and has never indicated that he thinks my price is too high.  We reduced the price last week from $123,900 to $119,900 and still getting no traffic.  My home is “move in ready”, with new laminate flooring, no repairs needs (sic), I have “de-personalized” and “de-cluttered”.  We are in the local newspaper on the front page of the Homes section every week, we are on the Duluth Area Association of Realtors MLS, the local Coldwell Banker website, the national Coldwell Banker website, and I also put regular ads on craigslist as well as hanging flyers around my work.  What else can i do?!?!  We are scheduled to move into the new house on 11/1/08, and the current home will then be vacant and unfurnished.

Melissa, you are not alone in your frustration.  As your agent said, many sellers are struggling to get their home sold.   As much as it may comfort you to hear that you are not alone, it really confirms that you must do something different to set yourself apart. Let’s talk about marketing, staging, timing, and price.

Marketing:  It sounds like you have some great exposure.  In my Southern California market, newspapers rarely work and I would suspect that’s true in your area as well.  It’s great exposure, yet more and more buyers that are serious spend their time online.  You have some great marketing online, but is it enough?  Here are some other ideas:

• Individual website for your property (If your agent needs a resource for this, I have a good one).  Rather than flyers at  your office, send a link to your own property website via email to friends that they could potential forward to their own friends and family.  Look how often people forward you emails.  This can be very effective.
• Are you on all the high traffic home search engines?  Zillow, Trulia, Realtor.com (fully enhanced with quality description and your agent’s contact info).
• Photos could use some improvement.  I’d rather see your agent invest in a photographer than newspaper advertising.  The baby’s room is great - but many of the shots almost appear to be looking at the floor.  I’d definitely get it reshot prior to your move.

Staging:  You’ve done such a great job of decluttering, it almost looks bare.  Revisit your dining room shot and the baby’s room shot.  The baby’s room looks warm and inviting.  The dining room looks cold and empty.  I’d reshoot that photo with the table set, the drapes open, and a plant in the corner.  Warm up the space.  Look at your photos through the eyes of a potential buyer.  Do they excited you?  Invite you?

Timing: Timing is critical when selling a home.  Right now you are facing some challenges due to the market conditions and consumer uncertainty with the coming election.  I suspect you also have local conditions that will soon play a role, the weather for example, as well as the local buying cycle.  You have your personal timing and your upcoming move that is impacting your sale.  Because you are facing some real negatives in terms of timing, this has to play a role in some of the decisions you are facing.

Pricing: You mentioned the comparables are a challenge due to the uniqueness of your home.  With 6 showings in 120 days, I would say that the market is telling you something.  Your home may be worth $120,000 if the timing was different.  But based on the timing and the traffic, I’d say another price reduction is clearly in order.  This can be a tough pill to swallow but you are facing some tough choices either way.

Remember, buyer’s motivation today is about finding a good deal.  They see the news and read the paper.  Potential buyers are nervous and reluctant.  What inspires them to take the leap in times of uncertainty is a good deal.  It’s not enough to be priced at fair market value.

Have you considered renting the property?  If you don’t want to reduce the price (or can’t), it might be time to think about renting it out.  These are tough choices.  Being a landlord has it’s own inherent risks and considerations.  If you do rent it out, try to have the lease expire in the Spring when the timing serves you to list it for sale again.

I would act with a sense of urgency on all the different areas that you can improve upon.  Have a heart-to-heart with your agent.  Communicate with him and together, you can get your home sold.

Agents - have I missed anything?  I know Melissa would appreciate any additional insight and help.

I have seen it time and time again.  Sellers do their due diligence and interview 3 agents.  Good for them.  Then they shoot themselves in the foot and just hire the one that says what they want to hear.

Today, I was speaking to one of the agents in my company and she shared with me a conversation she had with a potential seller (let’s call her Jane).  Jane said that they had to sell for $400,000 because they paid $350,000 not long ago and they would need $400,000 to cover their selling costs.  Unfortunately, as this excellent agent pointed out, buyers don’t assess value based on a seller’s need and Jane should consider herself fortunate to get the $350,000 that she paid for the home in our presently declining market.

When Jane begins to interview agents, what will she look for?  Will she focus on a solid marketing plan?  An experienced and savvy agent?  Staging recommendations?  Or, will she be looking for an agent that gives her the price that she wants to hear?

All too often, I see sellers that go with an agent that promises them the price they want, only to spend months on the market doing one price reduction after another.  Ultimately, they chase the market.  If Jane lists for $400,000 today and spends the next 120 days on the market, she runs the risk that when she is finally desperate enough to ‘price it right’ in 120 days, it might not even be worth the $350,000 it is worth today.

When interviewing agents and come up with a pricing strategy, make sure you are going with the agent that is shooting straight with you about the market and prices.  Disappointment today is likely to be far less expensive than it will be months down the road.

The conversation continues….

Today I came across a post on Teresa Boardman’s St. Paul Minnesota blog that ties right into a conversation I’ve had here a couple of times.  Again, it’s a reminder that what a home seller may find important, may not be seen with the same set of eyes by potential buyers.

I have urged my readers against being present for showings on Buyers Are Coming, You Should Be Going (Part I and Part II).  Teresa makes a good case against even leaving a note ’selling’ your home to potential buyers.  The only exception she made was to note things that might otherwise be missed - a new roof or a new water heater, for example.  The point she made that sounds all too familiar, “I get why sellers point out the features but I don’t think they always understand that what is important to them may not be important to buyers.”

I had a reader comment here about the value she brought to the sale by staying for showings.   I’ve had sellers discuss with me the desire to ‘help’ get their home sold by being present.  But I’m certain the risk of turning off a buyer outweighs the value it could bring.

You may be unwittingly driving your buyers away.  How?  Poor Feng Shui.

There can be some small things that you may not even notice that are important to buyers that judge a home by it’s energy flow or Feng Shui.  This is particularly critical if you are in a market that has a high Asian community.  But Feng Shui is becoming more and more popular across various cultures, so it’s important to take a look at some of the simple things that you can do to make sure that you aren’t unknowingly creating objections for your buyers.

• Feng Shui Fixes for Sellers by Nickie Rothwell
• Sharon Kasmira - Feng Shui for Sellers Part I
• Sharon Kasmira - Feng Shui for Sellers Part II

Pricing is a topic I beat to death because it’s so important.  But, can the difference of $1.00 really make a difference in a big ticket item like real estate?  YES!

In the retail world, we love to see things priced at $29.99.  Psychologically, it just feels better than $30.  It clearly makes a difference in our buying patterns because retailers love to continue to use this strategy.

Unfortunately, agents have gotten into the habit of utilizing this type of psychological pricing on homes.  For example, you may see a home priced at $599,999 rather than $600,000.  But, this is a critical error when trying to maximize buyer and agent traffic to a listing.

Clearly, a home is not an impulse purchase so very little is gained by the $1 difference in the price.  No one is fooled for long into thinking that home is cheaper when priced at $599,999.  But more importantly, it will actually hamper the times that the home will come up in a search.

Whether a buyer is doing a search online through some on the consumer search engines (Realtor.com, Trulia, or Zillow) or their Realtor’s MLS driven search engine (IDX),  they will usually search in $25,000 or $50,000 increments.  The same is true for an agent doing a search for a buyer on the MLS.  For example, I might search for homes between $550,000 to $600,000, or from $600,000 to $650,000.

Notice, if a home is priced at $599,999, it will not even come up in the search from $600,000 to $650,000.  This is a common mistake made and one that is easily remedied.  Just that small change can make a significant difference is the number of times a home is seen by both agents and buyers.  And this process is about maximizing traffic to your home.

This may be the only place I tell you to raise your price…go ahead… raise your price by $1.00! 

I frequently answer questions on Trulia’s Q & A for home seller’s in my local Orange County market, but across the country as well.  Tonight, I saw a question asked by a seller that I have to share with my readers because I know it’s a common strategy.

If you really want to move a house in today’s market what is reasonable to ask over fair market value?

I understand and can relate to this seller completely.  He’s simply asking for fair market value for his home and wants to know how much higher to price it so that he gives himself the necessary negotiating room.  Not an unfair strategy.  I get it.

Pricing from the seller’s vantage point is the biggest mistake a seller can make in pricing their home.   Particularly in a declining and weak real estate market, a buyer is looking for a deal.  In an economy that is faced with uncertainties and friends and family asking, ‘You’re buying a house?!” a buyer must be able to justify the potential downside risk.  They are not interested in fair market value - they want a deal.

As a seller, if you aren’t prepared to give them a deal, this may not be the market to sell in.  If you must sell, than you may have some tough decisions to make.  And be careful of the temptation to test a price for a while and reduce it later.  It rarely is a strategy that earns anything other than ‘Days on the Market’.

One more note - ask your local Realtor - are homes that are aggressively priced getting multiple offers?  In Orange County, they are.  It may be better to be priced 5% below Fair Market Value and sell quickly with multiple offers at full price, than pricing 5% over Fair Market Value and watch the prices decline further while you ‘test’ your price.