Many many sellers want to set a high price for their home and then promise themselves and their realtor that they will consider reducing the price at a later date - if the house does not sell. God forbid.
Here are some reasons why listing your house above market value is not a good strategy:
1. A high price will keep buyers away. Your wonderful home is just what a buyer wants but not at the price. The buyer will not put in an offer in case it insults you. If the offer that the Buyer wants to make appears too low, the buyer is uncomfortable with the thought that their offer may insult you so they will continue to look elsewhere. Most REALTOR® will tell you that trying to get a buyer to put in this type of offer is one of the most difficult things to accomplish. Some people will not even look in your home because the price is outside of their MLS® criteria that they have used to screen homes. Your price has eliminated potential Buyers before they have even seen your home.
2. The first people to see your home are often the most serious buyers and a too high price will not have buyers return when there is a price reduction. The initial flurry of buyers slows down the longer the house is on the market. It will be a struggle for your REALTOR® to call back all of the initial buyers – even people who have put in a low offer and been refused – when you finally decide to lower the price. In one case, over 60 people toured an overpriced home, when the price was reduced twice, only one person was still in the market. Real potential buyers were lost when the price was too high.
3. Too long on the market. Most buyers ask their REALTOR® how long a house has been on the market. This gives them an indication of problems with the house or with the price (otherwise the house would have sold). Too long on the market and buyers don’t want to buy a “picked-over”. In addition, owners start getting weary of always having their home in show home condition. The state of cleanliness and orderliness may start to deteriorate.
4. Signs of greed and then desperation. A price that is set too high looks to buyers like greed and then, when there are one or more price reductions, the buyer starts to think that desperation has set in for the seller. Some buyers do not want to be a player in either setting.
5. The REALTOR® sign on the lawn starts to look old. Okay, this is from my perspective but I want the neighbours to think that I can sell homes. If my sign is on your lawn too long, everyone who goes by on a daily basis is going to start thinking that I have failed to bring you an offer and sell your home. I want to sell your house and to make you and your neighbours think positively about my skills.
6. Fishing – not really selling. Sometimes a seller will put an unrealistic price on their home – just in case. The thinking is ” There is a sucker born every minute.” (P.T. Barnum). While the seller will sell if someone is naive enough to buy the house, few buyers with agents will take the seller and the price seriously. These are the houses that buyers skip over.
7. Your value and the bank’s value. Most offers are conditional upon arranging financing. This means that the mortgagee will be valuing the house to determine what mortgage level is appropriate. So…. If you have overvalued your home, found a naive buyer and think the sale will go through – think again. The bank will let the buyer know if the house is overvalued (as, hopefully, their realtor will already have done). This is a case of “nice try”. You think: ”So what? I will always find another buyer.” Well, under the MLS® this will appear as a Conditional Sale that did not go through which will alert REALTOR® that there is something going on with the home, one problem may be the value. Also, while your home is conditionally sold, not as many people will be interested in viewing it. You may continue to lose buyers.
8. No amount of advertising will overcome the wrong price. Some sellers think that, with the right advertising, anything will sell. This is not K-Tel. You cannot chop, slice and dice the house for a “low – low – never before seen price”. Buyers will have REALTOR® buying agents. Agents will have access to information. People spending hundreds of thousands of dollars on a house may do some investigation that will say that .. “You can fool all the people some of the time, and some of the people all the time, but you cannot fool all the people all the time.” Abraham Lincoln.
Finally, when setting a sale price for your home, ask for – demand to have your REALTOR®‘s expertise. Look at comparable houses in your area. Look at the economy. See if your home has plus or minus features compared to other homes and see if these features will require a price adjustment. If you want a sale, set your price to attract buyers.
Valerie Zinger ~ Ottawa, Canada ~ T 613-723-5300 ~ E. firstname.lastname@example.org
In spring and in late fall, wash your windows inside and out. If you live in a new development or near construction, you will want to wash your windows more often. Afraid of heights? Hire. There are lots of companies with ladders and climbers willing to do your second and third floor windows.
Let the sun shine on your sale.
Look around your home. Can you can find light fixtures that the builder put in for $10 to $25 each? These are unlikely to be antiques – just old and unattractive. If you have them (And who doesn’t?, think about replacing them with new fixtures that are more contemporary. A visit to a lighting store will expose you to medium to high end options. However, you can find nice replacements at Home Depot, Walmart and other less upscale retail outlets. I believe that updating the lighting will have a payback two or three time the value of the new fixtures. It would be difficult to defend this but…. Every Buyer I have taken to look at houses has noticed the lighting fixtures. If they are noticable then there must be a positive return on good fixture design.
Ugly light fixtures, part 2 @ http://www.flickr.com/photos/stinkypeter/139549392/in/set-72057594117160714/
Light Fixture @ http://www.flickr.com/photos/onetreehillstudios/2341978684/
light fixture @ http://www.flickr.com/photos/pinkmoose/195981706/
We all have these in our houses and, while we are living with them, they don’t seem to bother us. Now look at your house through “fresh eyes” as though you were looking to buy your house. Imagine what a difference good fixtures will make.
Happy Light Fixture Shopping.
This post has been updated and re-blogged
Under the old tatty carpet is a base for installing wood floors. If you are lucky, there is hardwood there. Can you lift the carpet and refinish the floors? You might want to install new hardwood. If you want a premium price for your home, make sure that you have installed premium flooring.
Buyers will dive in for a sale if they have walked the plank.
As I go out with Buyers looking at houses and host Open Houses on Sundays, there are things buyers seem to repeatedly notice. This series looks at the good and the not-so-good things that buyers have noticed.
There are many rooms in Ottawa with wallpaper borders. These were very popular in the 70s and 80s but have lost their charm over the decades. The one exception may be in a baby’s room when you know that the border is only temporary.
Buyers see borders and think that there will be many many hours of intensive labour needed to remove the border, patch the damage and repaint the room(s). If you are wanting to decrease the time it will take to sell your house, remove the border(s), repair the walls and freshen the paint.
One of my favourite TV shows is called Designed to Sell (okay, I am awake at 6:00AM in order to see the show but…..). In a recent episode the kitchen wallpaper border was a “must remove”. The designer said there are four “S’s” to border removal: Score – Soak – Sit – Scrape. Score the paper with the small scoring tool, soak the paper with a spray bottle of hot water mixed with laundry softener – sit and wait a few minutes until the soaking has taken place and then – scrape off the paper. Sometimes the thick paper is vinyl coated. It will tear off easily leaving the backing on the wall. If this happens, it is a blessing. The paper backing is often very easy to scrape off once it is soaked. Sounds like work? Yes it is but it will instantly bring your house a couple of decades forward.
To paraphrase the name of my favourite charity… Have
La Maison sans Frontiere
Photo credit: wallpaper removal….in progress @ http://www.flickr.com/photos/tapps/2723330247/
Freud aside, the right price for your home is not what your emotional investment is in the house. Yes, you love the house and put a high value on all the very personal time and attention you put into the house and yard, how this reflects on you as a person and what status the house gives you in the community, but….
Your ego investment in the house may far outstrip the market value. Some examples where ego gets in the way of setting a market price may be:
1. The rocks that you hauled in from the lake and set up as a rock garden – your rocks, your cottage. For the buyer – just a rock garden – no emotional attachment.
2. The baby’s room with special murals, lettering on the wall, and the baby’s name on the door. The graphic zebra in this picture is adorable and great work but, for the buyer with no children - a removal hassle – negative value.
3. The colour purple on the walls that matches the sofa that you are taking with you and all the coats of paint it took to get the right shade. For the buyer – several coats of primer and white to erase your purple – negative value.
4. The pigeon coupe that you built and that housed your much-loved award winning homing pigeons. For the buyer – the cost and yuk factor to remove the coupe.
Your REALTOR® can tell you what is getting in the way of setting a realistic value for your home. It is a tough message to deliver and a much tougher message to hear.
Set your ego aside when you set the asking price.
Photo Credit:Room by Color: graphic Zebra @ http://www.flickr.com/photos/danielleblue/199705090/in/set-72157594198881145/
If the city is under 3 feet of snow, how can a buyer know what your yard looks like? Draw a plan of the yard with the location and names (not Judy and Sally but Juniper and Sumac) of the trees and location of perennials. In summer, take some photos of your yard in case you sell in the winter.
Leave (every pun intended) the plan for buyers to see.
You are out with your real estate agent looking at homes. There is a wonderful house with wall to wall carpet and you want hardwood. Are you tempted to pull back the carpet in the corner just to take a peak?
DO NOT DO THIS.
This is not your house. You are damaging private property. If you really need to know, have your agent ask the listing agent if there is hardwood. Certainly if the house is less than 10 or 15 years old – when hardwood became popular again – if there is hardwood, it would show. If it is Granny’s house and very old, maybe yes, maybe no. In all cases, leave the carpet where you saw it.
Now for a little lesson. In some homes, the owner or builder put hardwood only up to a square or rectangle space in the room which was then carpeted. You look at the floor. You assume there is hardwood under the carpet and when you move in and start to remove the carpet – Voila – plywood. Buyer Beware. If you find carpet in the middle of the room that does not move, ask if there is hardwood beneath.
Finding out about flooring should not be beneath you.
Photo credit: hardwood under carpet @ http://www.flickr.com/photos/view/510764000/
Valerie Zinger ~ Ottawa, Canada ~ P. 613-723-5300 ~ E. email@example.com