Selling is Getting Harder: 5 Tips for Selling in Today’s Market For the Best Price
By JSL
House that needs substantial repairs in University Heights, OH
If you are trying to sell your home, you are well aware that the market is now more buyer-friendly (and we are certainly seeing this in Cuyahoga County, Portage County, and Summit County, Ohio).
We have all been hearing ad nauseum about interest rates, the Federal Reserve, fears of recession, listings sitting longer than they used to, more buyer incentives offered by sellers, and so on.
With this backdrop, what should you do to improve your home selling experience and your chances of getting the best price possible?
1. Review Recently Sold Comps to Improve your Listing (time involved: 10-20 minutes).
Listing for the right price is critical. If your list price is too high your listing will sit for too long, leading to a higher risk of low ball offers and buyers concerned there is something wrong with your home.
Even if you are working with a realtor, it is important for you to spend a little time understanding for yourself how your neighborhood is performing. That will allow you to ask the realtor the right questions when they suggest a list price.
Accordingly, reviewing recently sold comps to get a good understanding of what your home should sell for is very important. This will allow you to identify a solid list price and avoid a situation where your listing languishes on the market.
We love using Redfin to review recently sold comps because it is user-friendly and quick (Warning!: This is not to be confused with relying on Redfin’s value estimate of your home, which you should never do because Redfin’s value estimates are often wildly off-base).
Go to Redfin.com and enter your zip code in the search bar. Click on “All Filters” and then the “Sold” button. Then review the search results (or you can filter further by selecting “House” under “Home type” to remove superfluous results, and you can filter even further by selecting other property details like maximum and minimum square footage to really hone in on homes like yours).
Zoom in on the blocks immediately around your home to see what has sold recently around you (hint: Redfin’s default is to look 3 months back, but you can change this in the filters to look back further, just keep in mind that prices have softened over the past 6 months, so you don’t want to rely on a sold comp from July of 2022, for example).
Take a few minutes to compare and contrast the attributes of the homes that sold around you with your own home. Was their kitchen remodeled? Does their listing advertise a new roof, furnace, air conditioner or other items that your home does not have? Or is the opposite true, and your home has more to offer?
By spending a little time doing this type of search and comparison, you can quickly see what homes like yours are selling for, you can add and subtract value based on attributes of your home relative to those like it that recently sold, and you can avoid a scenario where you have a mispriced listing.
2. Don’t Live in the Past (By Expecting to Get the Price/Terms your Neighbor Got 6-12 Months Ago).
Building off the item above, if you want to sell your home quickly for the best possible price and have a good listing experience, you must avoid the trap of solely relying on what you know your neighbor and others in your neighborhood sold for last year or even 6 months ago.
When we value homes for sale or purchase today, we know that we will be in trouble if we don’t make some downward adjustment based not only on where the market is right now, but also on where it is headed.
The thing is, everyone is aware of what the prognosticators and pundits are saying right now about the direction of the housing market. As a result, the vast majority of buyers believe the market has already softened and will continue to soften in the near future.
If you try to sell your home expecting to get the price that your neighbor got in July, August or September, your listing will sit on the market for too long. When that happens, the vultures come out looking for a deal and you will start to get low ball offers and hard negotiators at your door.
Speak with your realtor about the exact percentage adjustment relative to sold comps you should make to your home’s listing price based on your specific neighborhood and the attributes of your home, but certainly make some adjustment from summer 2022 sold prices so your listing doesn’t die on the vine.
3. Think of Some Incentives You Might be Willing to Offer a Buyer (but get something in return!).
While you can expect to have more buyers asking for seller credits and incentives these days (for example, for a buyer to ask a seller to apply a portion of the purchase price to pay for a portion of the buyer’s closing costs), you can agree to do that in exchange for getting something back from the buyer.
By doing it this way, you can improve your chances of selling your home while at the same time not giving something without getting something in return.
Here are some examples of things you can ask for in exchange for providing a buyer with a credit:
i. An agreement that there will be no request for repairs or that specific items are off limits for repair requests.
For example, we recently provided a buyer with $1,500.00 in credits against their closing costs in exchange for their agreement to accept the roof of the home as-is. We knew they had planned to ask for repairs to the roof and the repairs to the roof would have cost us more than $1,500.00;
ii. A shorter escrow period. The escrow period is the length of time from entering into contract until the buyer is required to close on the home. So, for example, if the contract says the buyer has 35 days from contract signing to purchase your home, you can agree to give a buyer credit in exchange for them reducing the time to purchase from 35 days to 30 days; and
iii. Waiver of other credits. For example, you will often see buyer’s ask for credit for a 12-month home warranty plan in one section of the purchase contract and then request closing cost credits in another section of the contract. You can agree to provide the closing cost credit if the buyer waives their request for a home warranty credit.
4. Don’t Limit Yourself to One Pool of Buyers.
Everyone knows that demand increases prices. To create demand, you want as many eyeballs on your property as possible. The traditional approach is to hire a realtor who will put your property on the MLS.
They will also blast your listing out to the household names like Zillow.com, Redfin.com, Realtor.com, and the like.
However, even before you have a formal listing with a realtor, you can get your property in front of serious buyers by using google to search for and contact cash buyers in your area (for example, we regularly buy homes for cash quickly in Cuyahoga County, Portage County and Summit County), by putting your property up on Craigslist and Facebook, etc. and seeing what comes back.
You of course are not obligated to sell to any of these potential buyers unless you enter into contract with them, but by going through this process you can generate interest which can lead to greater demand for your property (and a higher sale price for you!).
Even better, if you do end up selling your home to a cash buyer, you can avoid paying any realtor commissions or escrow fees, which can be a huge savings.
5. Even Cheap Improvements Can Get You a Higher Price
With costs of materials and labor rising dramatically, some home improvements you might pursue to sell your home quickly for the best possible price are simply out of reach. However, both cash buyers like us and traditional home buyers will pay more for your home even if you make some limited improvements.
This is because some of these improvements are things we as the buyer would do anyway, we know how much they will cost us to do, and we will pay more for a home if we can cross some things off of the list because they are already done.
Here is a list of some inexpensive improvements you can make to your home to fetch a higher price:
i. Paint your kitchen cabinets white. This is something many buyers would do anyway and is a popular and sought-after color for cabinets right now.
Hint: Use a high-quality enamel paint and go for a semi-gloss or satin finish. We use Sherwin Williams’ Emerald Urethane (no we do not receive any compensation from them for saying that), but there are many options out there.
ii. Add new cabinet hardware to those freshly painted cabinets! This is one of the easiest things to do in your kitchen to make it look more modern, and it is very cheap to do. We like satin nickel bar pulls for our kitchens. Check out this article for additional advice on how to make a major difference in the appearance of your kitchen without gutting it.
iii. Do the same two items above on your old interior doors (paint white and install new hardware). Many older homes have old brown doors, brown door trim and old brass doorknobs. Simply painting the trim and doors with white semi-gloss or gloss enamel paint and modernizing the doorknobs and hinges can make a huge difference throughout your home. We do this in all our properties when the doors are salvageable.
iv. Replace the worst of your windows. Have several old metal or wood windows that are broken, drafty, and/or don’t work well? Replacing all your old windows would be very expensive, but if you have 1 or 2 that are particularly bad, you can target those.
You don’t need to use an expensive window company to replace windows, and replacing just a couple of your worst old windows with newer vinyl windows can improve your sale price and how quickly you sell.
The reality is that any investor, cash buyer or informed traditional buyer is going to check out your windows when they walk through your home. If your listing can state that you have some recent new vinyl windows installed, buyers will know they have fewer expenses and headaches if they purchase your home and will pay up for that.
While this is a more expensive item than the prior three, if you go through a local handyman with experience installing windows instead of a big window company (hint: avoid the companies that advertise on tv), you can save a lot and can easily install 2-3 windows for less than $1,000.00 in Cuyahoga County, Portage County and Summit County, OH. Try reaching out to your local carpenters’ union for references. They sometimes have members who do work on the side for a fair price.
We hope this list helps you maximize your sale price and reduces your time on the market. Best of luck with the sale of your property!
Josh has been a real estate investor since 2011, and owns/operates single-family, multifamily, and commercial real estate in multiple markets in Northeast Ohio with his wife and partner, Elina. When they are not onsite managing construction projects, getting their hands dirty fixing things, and touring neighborhoods and properties, Josh and Elina can be found walking in the Metroparks, enjoying ice cream at Mitchell’s, pretending to work out at LifeTime Fitness and traveling.
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