Everyone has an opinion on the best way to buy and sell a home, but like diet advice, it may not always be backed up by facts. These common real estate myths can make the process more difficult for you as well as impacting the financial outcome of both buying and selling. Take a look at the real estate beliefs making the rounds that just don’t hold up.
Price High to Sell High. Setting a higher asking price doesn’t usually mean you will get a better price for the home. Buyers are likely to skip the listing if it’s above their budget, and thanks to online searches where a top price is set, homes even just above that amount can be left out of results. Starting high and then dropping the price often backfires. It means the house sits on the market longer, which may put off some buyers, and a reduced price makes buyers wonder why you were forced to drop your asking price. You don’t want to price too low, either, but a more reasonable asking price may get more interest and more competing offers.
You’ll Save Money Without an Agent. As a general rule, you won’t save much, if anything, by not using an agent. This is particularly true for buyers, as the commission comes out of the sale price; if you don’t have an agent, the seller’s agent will simply take the full commission. When it comes to for sale by owner, it’s certainly possible, and yes, it will save you on the commission. However, a professional agent is likely to help you get a better selling price, which usually makes up for that cost.
Renovations Mean Big Returns – Especially Kitchens and Bathrooms. Many people believe that putting money into renovating the kitchen and bathrooms will earn them a big return on investment in the selling price. Unfortunately, that’s not so. Very few remodels of any kind will recoup their costs, and kitchen and bathroom remodels don’t even come close. Skip the renovations and price your home accordingly, and you’ll come out better in the end.
You Need to Have an Open House. Having an open house rarely translates to the home being sold. It brings in the curious and gives the agent a chance to pick up new clients, but it generally doesn’t sell the house. Sellers can skip this step without damaging the chances of selling.
Your Home Value is Guaranteed to Rise. A lot of people buy thinking that they’ll see nothing but growth in their property value and soon have plenty of equity. The housing market isn’t quite the guaranteed return on investment that people expect: there are fluctuations, and sometimes major dips in the market. Longtime homeowners know that you simply weather the low points. If you’re looking to flip a house or upgrade in a short time period, be prepared for the possibility that it may not go up the way you hope.
All Agents Represent Your Interests. While this is often true when you hire an agent, it’s not always the case. Some agents work differently as brokers and have no responsibility to represent either the buyer’s or the seller’s interests. Although you should be made aware of this before the transaction, it doesn’t hurt to verify with the agent ahead of time.
When it comes to the real estate process, it’s always best to do your research. Choose a real estate agent you can trust and who will work for what is best for you, whether you are buying or selling, and make sure to double check what’s true and what isn’t when getting real estate advice.