Selling a home can be one of the most stressful experiences of your life, but it doesn’t have to be. According to CNBC, nearly 40% of Americans cry during the process of selling their home. That sounds like a mental health crisis and a possible divorce waiting to happen. To help you avoid that, here are my top five tips for selling a home in 2024.
1. Find Your Agent
Should you use a traditional agent or an iBuyer? Personally, I believe eventually the iBuyers will take over the field of real estate. But that day isn’t here yet.
Do your research: The iBuyers are still not a good deal for the seller. They take heftier commissions than the local market (they just call them something else, like experience charge or credit fees) and they are incentivized to pay you a lot less than market rates. For now, a traditional real estate agent still makes more sense.
Find an agent who has:
- A realtor with several years’ experience in your specific market and price point. The average realtor in central Ohio has less than three years in the business, and are still taking any deal, anywhere they can get one. You want a professional with clear experience and knowledge of your market.
- A realtor who has sold a minimum of several hundred homes. The average realtor in central Ohio has sold fewer than seven homes. That is not enough experience to identify potential problems in offers that could cost you dearly at closing.
- A realtor you feel comfortable with, who you feel can clearly understand your goals. Identifying the “highest” price is easy. Identifying the “best” price requires knowing you and your goals. You want someone who can bring you the “highest and best” offer.
- A realtor who has a support team to handle the details. There is approximately 30 hours of purely administrative and compliance paperwork involved in a real estate transaction. You are hiring a realtor to find and negotiate your highest and best price. You don’t want them spending 90% of their time processing paperwork. Choose a realtor with a business capable of hiring administrators to do the administration work.
2. Prep for the Sale
Address any major issues upfront, before going on market. This is an important step, as 95% of contracts that fall apart do so because of conflicts that arise during the inspection. By addressing major issues ahead of time, like the roof, sewer, or HVAC, you can limit the undue stress and lost time that frequently accompanies a sale. Even if you are selling the home “as-is”, you should still disclose the issues and provide buyers with estimates for the repairs. When buyers are surprised by a problem, they tend to always assume the worst. Eliminate the surprises.
Always use professional photography and videos. They are inexpensive and very important. Most buyers are doing their primary searching online. In Columbus, professional photography is only a few hundred dollars, and most full-service realtors include it in their services. Depending on the property, also include drone footage, video, and Ai furniture. Selling is a numbers game, and you will attract the highest number of potential buyers with excellent photos. Do not skimp on this.
3. Make Sure Your Comps Are Correct
There are a few criteria I consider when pulling comps:
- Proximity: Keep within a mile if possible. Homes within a neighborhood may vary significantly in condition, but the location never changes.
- Square footage: Larger homes have a lower price per square foot than smaller properties, so it’s important to pull from houses with a similar footprint.
- Bathrooms: I care about bathrooms a lot more than I care about bedrooms. It’s much more difficult and expensive to add a bathroom, which requires plumbing and expertise, to a house than it is to add a room, which just needs drywall. Also, the difference between one bathroom and two is huge, so that counts for more.
- Above grade rooms: Rooms above grade are more valuable than below grade. Basement bedrooms and bathrooms are nice features but are not the same value as bedrooms and bathrooms on the above grade living areas.
- Parking/garage: The number of garages is tied directly to price range and location. A two-car garage on a $850,000 home is great in Clintonville but can be a difficult sale in Dublin. Know what the buyers are expecting the various areas.
- Zoning: This is becoming increasingly important with the popularity of Airbnb, house hacking, and co-living arrangements. Know the rules and projected zoning plans. Depending on who your buyer is, certain zoning categories are worth more than others.
- School district: Go figure. People care about their kids’ education. It makes a difference.
- Year built: Houses in the same development were likely built around the same time, but in tight markets like Columbus, you may be pulling from a wider radius just to get a handful of properties. If you do that, you might go outside the development, so make sure the other houses being pulled were built within 20 years of the house you are selling.
- Features: Look at how you compare with common features on homes in the area. This will tell you what buyers are expecting when they look at your home. If all the yards in the community are small, buyers will expect yours is the same. But if the community is known for large yards, and yours is small, it is going to affect your price. This is true of almost all common features, such as ceiling heights, granite countertops, finished basements, wooded lots, large kitchens, luxury master suites. Buyers become familiar with neighborhoods and develop expectations. The value of these features is subject to those expectations.
4. Set the Right Price
Due to low inventory, “Bidding wars” are still common in central Ohio, with sellers often receiving multiple offers at above asking price. The key to selling in this market is to set an attractive price (meaning slightly below market), to attract the highest number of buyers to drive the price up. I understand why this makes sellers nervous, but the fact is the asking price is not the final price. The initial asking price is a marketing tool. It is an arbitrary number created by the listing agent to attract the highest number of qualified buyers. Ultimately the market decides all prices.
If the property is overpriced, it sits, acquires a stigma. In a market where most homes are selling in a weekend, sitting on the market for a month is a death nail. Buyers will avoid it like the plague, assuming there is something wrong with it. And trying to drop the price after month does not eliminate that stigma. This of course applies to markets and homes that selling in a weekend is realistic. It is rare to sell above asking price after the first week or two. If you have a ore unique home with a smaller potential market of buyers, you would want to incorporate a different strategy.
5. Qualify Your Buyer
There are two steps to this in this process.
The first step is the standard lender letter and phone call. The lender letter should disclose what they qualify for and under what terms. The phone call should give the seller peace of mind that the lender is local and available to talk if issues come up.
Then there is the second part. Lender letters are easy to get. Your realtor must also qualify the buyer. This includes things like getting proof of funds, verifying assets to cover appraisal gaps, learning where they are coming from and why they want this home, are they first time buyers, where do they work, and so forth. There are many ways for a contract to fall apart, and the more you know, the better you can predict the successful outcome.
Final Thoughts
Buying or selling a house is a big deal. It’s likely one of, if not the largest financial decisions you’ll make. It’s fair for it to be stressful, but you can limit a lot of this stress by knowing what to expect.
What do you do to make sure your properties are sale-ready? Share your presale process in the comments.
Kyle Alfriend has been investing in real estate for over 35 years, assisting over 3,000 clients in buying, selling, or investing in real estate.
For more tips on buying, selling, or investing, or for a personal consultation, contact Kyle Alfriend, (614) 395-1776, or info@AlfriendGroup.com. Or go to our website, AlfriendGroup.com