Home Selling Tips
Is the buyer's agent your friend?
Buyer's agents know more about negotiating a real estate contract than 99% of all sellers. Some buyer's agents, usually from the big name companies, are downright aggressive, mean, pushy, and arrogant! We do battle with 100's of buyer's agents each year. Our skin is tough and our skills are honed because We use all our skills to move these buyer's agents towards our seller's price while they use all their skills to counter our efforts. Buyer's agents represent their buyer and your home is what they want for the least possible price. When making an offer, typically, buyer's agents will present to you with a list "comparables" of recent sales in your neighborhood and attempt to convince you that their offer is reasonable. While this is understandable considering they represent the buyer, it is just as smart to consider allowing a professional real estate negotiator to represent you. You may consider the ALTRU PLATINUM PRO listing plan $499 plus ⅞% at close ($1,500 min) where your best interests will be cared for every step of the way to ensure the contract is worded correctly, that there are no expenses pushed onto the seller's side that belong to the buyer and we don't engage a buyer that can't close.
Should I stage my home?
Staging a home does work. Professional staging services are available in most cities. The art of staging works best if the home is freshly painted and very clean. Often buyers perceive a tastefully furnished (staged) home as more welcoming than the same home left vacant.
Should I repaint and trim the hedges before I list my home listing?
Yes. Choose colors that are warm but neutral. Look through home improvement or architectural magazines for ideas. Avoid using bold colors that could clash with someone else's decor. Your red bedroom might go great with your drapes and bedspread but it could clash with their baby blues. A well-groomed yard will create curb appeal and give buyers a sense that the entire home is well maintained before they cross the threshold.
Should I update the kitchen, flooring and other home improvements before I list my in the MLS?
No. This takes time and lots of money! In a buyer's market, remodeling may help you net more money. But, in a buyer's market, 99% of the time it is far better to just declutter, paint and clean. Remove all personal items and knick-knacks and store somewhere. Buyers can then envision their own belongings in the space.
What if the appraisal fails to meet the contract price?
The art of negotiations when representing the seller is to reach a contract that pushes the upper limits of the appraised value of a home. If the home doesn't appraise, the seller or buyer can cancel the contract or negotiate the appraisal short fall. When negotiating the short fall, there are a few solutions. One possible solution would be to split the difference with the buyer. This assumes the buyer likes the home enough to pay a premium over appraised value and has the extra cash to do so while keeping their loan to value ratio in line. Of course, we are assuming they are not cash buyers. Another seller technique is to request the buyer pay all or some of the seller's traditional closing costs to offset the appraisal shortfall. In today's buyer's market, appraised value is a great deal for the buyer so the buyer should be the more willing “giver”. You would think, anyway!
The inspection and who is paying for the inspection related repairs?
The buyer pays for the building inspection, mold inspections, and other buyer requested inspections. It is up the buyer's agent to schedule these inspections within the time frames mandated by the contract. Once an inspection is performed by a licensed home inspector, an extensive report is made available to the seller. Each contract has different language relating to how much the seller maybe be responsible for inspection related “warranted items”.
The buyer's "pre-approval letter" is dangerous
One of the most important aspects of negotiations is "who the buyer is". Some buyers present "letters of qualification" that are not worth the paper they are written on. Unqualified buyers can tie up your property for 30 days or longer and not close the deal. To prevent this, thoroughly investigate the buyer and the mortgage broker/lenders credibility. Lenders don't care about sellers as they only care about closing their loan. ALTRU PLATINUM PRO, our discount full-service listing plan, provides protection from this happening to you.
Who Pays for Title Insurance, the buyer or seller?
This depends on local customs and which box is checked on the contract. It can be the buyer or the seller.
Can a Seller request that the buyer to pay all closing costs?
Yes. Typically, seller closing costs are title policy and doc stamps on deed. Use our closing calculator for an estimate of these costs.
Can a buyer request that the seller pay all or a percentage of the closing costs?
Yes. This a typical request when the sales price is $180,000 and less. Especially first time buyers.
Does adding buyer's closing costs to a contract increase the risk of not appraising?
Yes. When a seller pays for a buyer's closing costs the hope would be for this request to be passed onto the buyer by merely adding the 3-6% "buyer closing costs request" onto to figure that the seller was looking to net. But, if this seller's "net figure" is at the high-end of appraised value, then by adding the buyer's closing costs onto the seller's “net” the contract price may exceed appraised value. This will result in renegotiations with the buyer. The alternative would be for the seller to say "no" to the buyer's request to pay closing costs, or attempt to negotiate a lower request from the buyer. Patience when accepting the "right" buyer often pays. It's all about the right buyer and appraisal.
What happens if the real estate tax proration calculated at closing turns out to be incorrect once the tax bill comes?
Many sellers feel apprehensive about the process of how real estate tax proration at closing. Protocol is that the buyer receives a credit from the seller at closing for a tax year that is not billed. In most cases, the seller is selling for less than what they bought and often wonders if the new buyer's tax bill (paid in arrears) will be less than what is being held back at closing. The solution for this problem is to have the buyer and seller sign an affidavit at closing stating that either party will compensate the “shorted” party for any real estate tax inequities. Seems the buyer will be unmotivated to pay the seller if the sellers concerns materialize especially if the value of their new purchase has declined. After a nicely worded certified letter, consider a not-so-nice attorney letter and then small claims court.
Chasing the market?
Ever wonder why your home hasn't sold while you have had 40 showings with no offers? It's all about the Realtors! Even a $5,000 decrease in price can ignite the interest of the buyer's agents. So, what are they looking at that has prevented an offer from coming forward? It is usually their expectation of where appraised value is v. your list price. Realtors, compare “list price” to what they believe is appraised value and make offers on those properties that are closest to the "appraisal envelop".
What is an "appraisal envelop"?
It is the range of where several independent appraisals would create an envelope of value.
Get more for your home by doing your own thorough punch out list
The best way to get a higher offer and close a sale is to have your home ready to pass a home inspection. If a Realtor is involved in the sale of a home, they will recommend a home inspection. Home inspectors are extremely thorough and will find most defects.
But it is not just the home inspector that sees a home's flaws…it's the buyer's agents and their buyers. One home in particular exemplifies how one crack in a garage wall can ruin not one deal, but two deals. This home was in Gainesville, Florida and the frame construction garage wall had a crack that was not only obvious to all that viewed the home but once inspected, revealed that water had penetrated the wall. This was a rather expensive home and in both cases the buyers walked after the home was inspected. There was one other issue besides the crack in the wall. There was also a burned out pool pump.
The seller insisted that the wall crack was inspected by a licensed contractor and it was fine. What the seller failed to recognize is that licensed contractors were not buying the home, buyers were. I suggested to the seller many times to just repair the crack. The cost to repair the crack was about $1,000. This mere $1,000 crack ultimately cost the sellers 2 buyers, added 4 months to the closing and in the end, cost the sellers in excess of $10,000 in taxes, insurance and additional mortgage payments.
There are many very similar situations but no need reiterate the lesson learned here which is have a qualified handyman or inspection company thoroughly inspect your home including searching the exterior stucco and wood surfaces for rot, roof for nail pops and missing shingles, reverse polarity in outlets, missing GFI (code is all outlets within 6' of water must be GFI or CGFI), ungrounded pool pumps, leaks in any plumbing, leaves in gutters and if possible, ask your handyman if he has a moisture reader which detects high moisture levels under windows, walls and ceilings.
It is far less expensive to repair these items ahead of time with a handyman rather than enter sales contract and be bound by “repair limits” (usually 1.5% of the contract) and contract language which requires all repairs to be completed by a licensed contractor.
Additional articles and tips for selling your home
- Tips for Open Houses
- Reasons to Hire an Attorney
- Common Mistakes to be aware of when choosing a Florida Flat Fee MLS Company.lnk
- Avoid costly mistakes when selling your home
- 5 Tips for a Smooth & Speedy Sale
- 10 Tips to Successfully Sell your Home
- A statistic comparison betweeen flat fee MLS listing and full service real estate agents
- Beware of scams
- What is the MLS, and how will it help me sell my home
- Common Mistakes to be aware of when choosing a Florida Flat Fee MLS Company
- Key differences between Flat Fee MLS listed properties and Full Service Realtors
- Tips on writing your property description for the MLS
- The Flat Fee MLS Concept
- For-Sale-By-Owner signs can make a Realtor hesitate to show your home