7 Things First-Time Home Sellers Need to Know
Selling your home can be exciting, but it can also be stressful and confusing, especially if you’ve never done it before. From calculating your agent's commission to setting the right list price and figuring out how to deduct moving expenses on your taxes, selling your home can be tough. You can, however, make your home sale a smooth, satisfying experience by keeping a few basic principles in mind.
1. Understand your priorities
Before you list your home or start preparing it for the market, you should think about what you want from your home sale.
Do you need to move out in time to start a new job out of state or for the kids to start school? Are you determined to get the highest possible price for your home? Would you be comfortable selling your home to a buyer who would heavily renovate it into something new? Or is it a much-loved home that you want to sell to a buyer who’ll appreciate it as much as you do?
Your response to these questions will dramatically shape your selling strategy, so you should know the answers before you put your home for sale.
2. Pricing is vital
Your initial list price is one of the biggest determinants of your home sale's success.
A price that’s too high could alienate many buyers and result in tepid interest in your listing. You may be forced to cut your price, perhaps multiple times, before finding a buyer — if you find one at all.
Contrary to many assumptions, a list price that’s too low can also alienate buyers. That’s because buyers associate price with quality, and when a price is suspiciously low, they’ll assume there are hidden problems or that the house needs significant repairs. Buyers who hope to sell quickly by offering a low price may end up sabotaging themselves.
High sale prices aren’t always achieved by high list prices. Sometimes they’re the result of a bidding war. A good pricing strategy may be to list at a moderate price that will attract a lot of buyers.
For a quick sale, consider listing at the home’s previous sale price, which signals to buyers that you’re not looking for a big profit.
3. Timing the market can make a huge difference
The time of year you list can also determine the success of your sale. In general, the market is hottest during the spring and summer months, when the weather is nice and families are looking to move before the start of a new school year.
The market tends to be the slowest in the winter, when holiday spending and travel deter most home buyers. A desirable property priced competitively could languish on the market for weeks if listed in December, while the same property will likely sell fast if listed in May.
4. Presentation matters
Every home can benefit from a little pre-sale sprucing. Don’t assume buyers will be able to envision your home’s ideal state. You have to show them.
Before you list, give your home a deep clean and thoroughly declutter. Experts suggest removing at least half your furniture and emptying about half your storage space. Buyers always look in closets and cupboards, and if those spaces are full, the buyer may assume the home doesn’t have enough storage.
Don’t forget the exterior of your home. Touch up the landscaping, powerwash, or consider a new coat of paint to maximize your home’s curb appeal. That first impression is important.
Finally, it doesn’t do any good to make improvements if they won't be visible in the listing photos. Hire a professional real estate photographer to take flattering, high-quality pictures of your home so buyers looking at online listings will have a positive impression.
5. Be flexible
Don’t go into your home sale with a “take it or leave it” attitude. Buyers want to negotiate to get a good deal, and smart sellers will accommodate them.
Price isn’t the only item that’s negotiable in a sales agreement. You can negotiate everything from the closing date to repair credits and home warranties.
Being flexible is particularly important advice as a yearslong seller’s market slowly transitions into a market that's more friendly to buyers. Today’s buyers will feel empowered to ask for concessions, and depending on your local market, you may have to grant them or risk losing the sale.
6. Don’t get emotional
Selling your home can be an unexpectedly emotional experience, especially if the negotiations are heated. In addition, you’re probably stressing about the logistics of packing your stuff, filing a change of address, and buying your next home.
Don’t let your emotions get involved. Remember, this is a purely financial transaction, and buyers are simply doing what’s in their best interest. Making unreasonable demands and counterdemands or walking away from a deal for emotional reasons is counterproductive in the long run.
7. Working with an agent is probably worth the commission
A lot of sellers may balk at paying 6% commission to a real estate agent. Some sellers look for agents that charge much lower commission, while others may try to sell their home themselves. However, in the majority of cases, agent commission is money well spent.
First, the 6% commission is actually split equally between two agents — 3% for the seller’s agent and 3% for the buyer’s agent. Even if you forgo working with a seller's agent, you’ll very likely have to pay 3% commission to the buyer’s agent.
For the seller's portion, 3% commission will get you quite a bit, actually. Agents can help with pricing strategy, timing the market, and pre-sale home preparation. Plus, their advice is based on hundreds of previous home sales.
Agents are also professional negotiators, so they can hammer out the best possible deal with the other side. That 3% commission may sound significant, and it is, but it also provides great value, especially for first-time home sellers.
