When you begin the process of selling your home, anticipating obstacles before they arise is vital.
Since selling your home can be a lengthy process that involves choosing an agent, estimating costs, preparing your home, setting the price, and finally finding the right buyer, the consequences of a mistake along the way can have wide-ranging implications.
Here are four of the most common mistakes sellers make and how you can avoid them.
Choose a real estate agent who has your best interests at heart. Usually, an agent will charge a percentage of the sales price (around 5-6 percent), while others may charge a flat fee. Most agents’ commission is negotiable.
To ensure you select the right real estate agent, make a shortlist of agents in your area and interview them.
Check their credentials, get references from their past clients, and make sure they have experience selling houses in your area and within your price point. For instance, if you live in New York, interview a few Charlotte NC realtors before you make a decision.
Although many sellers don’t realize it, selling a home is costlier than just the agent’s 5-6 percent commission. When you take closing costs, repairs, and other concessions to the buyer into account, a seller is actually looking at around 10 percent.
If, for instance, you have to move into your newly-purchased home before selling your old one, you’ll have to pay two mortgages, as well as other costs and repairs (like HOA fees, taxes, storage, and utilities).
Although everyone wants the best price for their home, the amount you want and what the market will pay may be two very different figures.
Setting the right price for your home is a balancing act – you want to hit the “sweet spot” between asking too much or too little. If you can’t find that sweet spot, you may find yourself leaving money on the table or leaving your home to sit on the market for too long.
It’s a good idea to look at comparable houses to yours, or “comps.” Estate agents use these “comps” to get an idea of what your house is worth based on other homes in the area of similar size.
However, bear in mind that no two comps are exactly alike, so differences need to be accounted for and represented in the selling price.
While the highest offer for your home is exciting, it’s not always the best offer for your needs. In a real estate sale, it’s common for there to be contingencies – or conditions – that need to be met before the buyer will close the deal.
These contingencies are put in place to protect the buyer’s interests. For instance, financing contingencies and inspection contingencies can impact the timeline, certainty, and complexity of the sale.
For example, a buyer may make a high offer on your home that is subject to the buyer selling their existing house, or a buyer may make a high offer contingent to repair credits.