What can you do to help your home sell faster? The seller has three tools available to affect the marketability of their home: Price – Condition – Terms
Price is the easiest to adjust for the competing properties, amount of inventory or market conditions. However, lowering the price is not necessarily the best decision when trying to maximize the proceeds of sale. For those who dispute that price equals the number of days your property is on the market, I offer this scenario: how fast would you buy a home if it carried an asking price of five dollars?
Sometimes it is appropriate for sellers to postpone cosmetic work until the buyers have an opportunity to inspect and request that deficiencies are corrected. This rationale acknowledges that buyers often would rather make their own choices. So if you re-carpet the den and paint the bookshelves, your next buyer may want to knock the entire den off of the house to rebuild something else in its place (spa, closet, whatever). However, if a home is in poor or outdated condition, updating should probably be done to make it show favorably with other homes that are currently on the market. The truth is that most buyers are using all their resources to get into the home and may need to live in its present condition until they can save enough to make the changes they want.
A big reason to go ahead and invest the money and effort into improving the condition is that it is difficult for buyers to imagine the home any other way than its current condition. When comparing one home to another, buyers will sometimes refer to a home as the “stinky house” or the “old kitchen” which may put it at a disadvantage. It took many unsuccessful showings for us to convince one seller that buyers reported a distaste for their bright pink living room; but a weekend paint job yielded an offer two days later.
Years ago we wouldn’t necessarily have offered the following advice but in these times it seems to be pertinent, unfortunately. Potential buyers in your home tend to judge not only the house but the current occupants as well. They will check out any photos, collections, or other memorabilia that you display. For the seller, this is what makes a home personal. For a buyer, this can tip off something as simple as they don’t like the seller because of the seller’s political affiliations. So rule of thumb: de-personalize and de-clutter your home for best results.
While price and condition are the main things that control the marketability, terms can be equally effective. Terms relate to financial considerations made by the seller to induce a buyer to make a decision to purchase their home.
Seller-paid points or closing costs, interest rate buy downs and owner-financing are examples of some creative financing terms that may increase the marketability of a home because of the additional benefits they offer to buyers, often making it possible for the buyer in a situation where otherwise the buyer could not have considered the purchase.
An example could be that a seller will carry a 10% second lien so that the buyer can get an 80% loan and avoid the expense of mortgage insurance. The seller gets most of their equity plus a fair interest rate on the loan that doesn’t have to be tied up for 30 years like the first mortgage.
Increasing the marketability of your home is a great conversation to have with me, especially so I can help you get the highest price in the shortest time with the fewest problems. Not all realtors are equally experienced or creative so you might want to consider this when you interview your own listing agent.