Question: I have been trying unsuccessfully to sell my home for the last couple of weeks after being told by my company that I would have to relocate. I am single, so I have no family concerns, but I am worried about having these payments hanging over my head after my move.
My company offers me no help in this situation, and I have heard horror stories from co-workers and friends who had to move and ended up making extra house payments for months or even years.
What can I do to make sure my house sells quickly, without taking a bath on the price?
G.B., Everett
Answer: You probably don’t want to hear what I’m about to say, but the best way to sell a home quickly is to price it aggressively. By aggressively, I mean lower than your competition. Try to separate your emotions from the situation. Remember, your home is special to you, but to prospective buyers it’s just another house. You want it to stand out from the crowd, and the best way to do that is to put a price on your home that gets attention.
One of the most common mistakes home sellers make is to overprice their house. There are many reasons for this: The sellers may think their house is worth more than the price suggested by their listing agent; they may want to test the waters in hopes that some buyer will be dumb enough to pay an inflated price for the home; or they may be pricing their home based on the amount of money they need to net rather than the amount they can realistically expect to get.
The housing market is slow throughout the Puget Sound region, but homes that are priced right still sell fairly quickly. You’ve probably noticed that some homes in your neighborhood have been sitting on the market for months without selling. Why? Because they are overpriced for today’s housing market. It’s really that simple.
This is a buyer’s market, and buyers aren’t stupid. They will shop around and compare your home to others on the market. If your price is out of line, they probably won’t even bother to make an offer.
Today there are many more homes for sale than buyers, so competition is stiff. To sell in this market, you must first assess your competition. Find out what similar homes in your neighborhood have sold for in the last couple of months. Notice that I said the sold price, not the listing price. Most homes now sell for less that the asking price.
Market your home slightly below the average sales price in your neighborhood. I don’t think it’s worth the time and aggravation to try to squeeze an extra few thousand dollars out of the house you are selling. Whenever I sell a home, I always price it at the lowest price that I willing to accept and then hold firm. Don’t bother adding in negotiating room. A lower asking price will get the attention of real estate agents and buyers in your area and it will sell much faster than the competing homes.
You said that you don’t want to take a bath on the price of your home, but you have to remember that a home is only worth as much as a buyer is willing to pay for it. If your home has been on the market for several weeks with no takers, you are probably asking more than the home is truly worth.
At that point, you have only two options: Face the facts and reduce your asking price until the home sells. Or rent the house out until the resale market improves or the home’s value increases.
The second option is not very attractive because I believe it will take several years before we see home prices in this region begin to appreciate again.
If you decide to keep your home as a rental, you will have to line up a property management company or a friend to keep an eye on the place while you’re out of state. Expect to pay a property management company about 10 percent of your gross monthly rent.
That will make it even harder to cover your mortgage on the house, and being a long-distance landlord is not a lot of fun.
You may just have to bite the bullet and sell your home for the best price you can get. If you are trying to sell your home yourself, get a real estate agent. If you already have an agent, make sure that he or she holds brokers open houses to promote your home to other agents at nearby real estate offices.
Ask the agents who tour your home for price opinions. If the consensus is that your price is too high, reduce it to the average price suggested by the agents. Remember, the agents are working with home buyers every day, so they know what the market will bear. Ignore their advice at your own financial risk.
Mail your real estate questions to Steve Tytler, The Herald, P.O. Box, Everett, WA 98206, or e-mail him at economy@heraldnet.com.
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