Top Ten Failures To Sell By Owner
Posted On March 25, 2021
1. Prices too ambitious An owner’s home is unique and special to him or her. They chose this house above all others, made it their own, lovingly maintained it, and tirelessly updated it. It is natural that, above all others, they overvalue the property as a competitive product in the real estate market. A quick tour of the Zillow.com For Sale by Owner listings highlights this issue where the vast majority of owners value their listing significantly above the Zillow Zestimate. While the Zestimate is not the last word in market analysis, it tends to be very close. Additionally, the data used for a Zestimate reflects homes sold by realtors, as they sell the majority of homes in the U.S. These sales are typically 10% to 18% higher than homes sold by the owner.
2. Don’t update- Often times, decorating a home is perfect for the current owner, even if it was last done years before. Unfortunately, buyers generally expect updated décor, appliances, mechanicals, and exteriors. Otherwise, they devalue the home by the amount they estimate it would cost to make the home look and feel its current way. This amount tends to be more than the upgrade would actually cost, so it makes sense to get the work done before the home is marketed. If this is not possible, the cost must be included in the sale price. “For the price we ask, they should take it as is.” thought doesn’t fly, they won’t.
3. Lack of commercialization A sign on the lawn and a Craigslist listing is not enough in today’s highly competitive market. Marketing is successful if a buyer had to live under a rock to be unaware of the price. Presentation is equally important. A home must look wonderfully attractive to compete with the professionally photographed and represented listings typical of today’s real estate agent submissions. A great way to do this is with a flat rate MLS listing. Find out more links at the end of this article.
4. The imaginary buyer The sales capacity of a house can be determined by the size of the group of buyers present for a particular house in a given location for a range of prices – how many buyers are looking for a house like this. Sellers often envision a buyer who would be interested in their listing at the price they want. This phantom buyer probably doesn’t exist, or if it did, it would probably buy something at a more competitive price.
5. Inflexibility Every situation is different. What appears to be the best way to sell is often frustrated or unsuccessful. When this happens, the lack of reassessment and redirection often puts the process at a standstill. The real estate environment changes slowly and often not in the desired direction.
6. Creative financing Homeowners often receive “creative” offers from prospective buyers who have an unfortunate tendency to fail or cause serious financial harm to the seller. These prospects have often been rejected by property owners represented by real estate agents who know they should not engage in shady deals with unsubstantiated buyers.
7. Not qualify- Homeowners often accept buyer contracts that are not credible. The result is usually a crash, back to where you started, or litigation. A buyer must be qualified before viewing the home.
8. Availability- Homeowners must be available 24 hours a day, 7 days a week, by phone or email to answer questions about the home and to schedule visits at the convenience of qualified buyers. If they have to wait, they will usually see something else.
9. Negotiations Lack of negotiation skills costs sellers millions of dollars each year in the US Homeowners attract willing, willing and able buyers to defend them. These same prospects would have little luck in the small-time sellers represented by Realtor who are highly trained and experienced in negotiations and can spot a wheel dealer from a mile away.
10. Do not consult a Pro- Even if there is some compelling reason not to use a real estate agent to handle the sale professionally, not having one available to avoid devastating situations that can often destroy an otherwise viable sale. The next best person to consult is a real estate attorney; no transaction should be done without either of you; there is too much at stake in the outcome.