A Tip for Sellers

Another informative video brought to you by:
Keller Williams Realty

An appraisal can be ordered for many reasons. For instance, a bank will order an appraisal of a house before they agree to refinance a loan. An appraisal may tell a lender the replacement value of a home or whether the loan is a good business decision for the bank. It can be ordered to help dispute a property tax increase or to prove replacement value of a property to an insurance company.

But an appraisal won’t help you determine the best price to get the house sold for one simple fact: an appraisal tells you what the lenders or the county thinks your house is worth, but they don’t tell you what a buyer will think it’s worth. A buyer will base their opinion of what the home is worth on their agent’s comparative market analysis, not an appraiser’s report.

All of the text and video for this post was originally created and published by Keller Williams Realty

A Tip for Sellers

Another informative video brought to you by:
Keller Williams Realty

Staging a house is a bit different from improvements made over the years.

The focus of staging is to declutter and depersonalize the house so that potential buyers can readily imagine themselves living there.

This might mean some landscape improvements to enhance curb appeal, putting some furniture in storage, moving items so that there is a clear path into each room, taking down the family photos and re-painting as necessary.

A properly staged house can result in a quicker sale and a gain of as much as 1% on the sale of the average house.

And the best part is that you don’t have to guess what will make your house more appealing to buyers. Your real estate agent can arrange an appointment with a stager to make sure your house shines in comparison to the competition.

All of the text and video for this post was originally created and published by Keller Williams Realty

A Tip for Sellers

Another informative video brought to you by:
Keller Williams Realty

When it comes to selling your house, you probably want to get the most money you can in the least amount of time, with the least amount of hassle.

To help you create the best pricing strategy, we’ve compiled research and advice from leading experts to give you the very best answers to the most common pricing issues and questions.
This is the result of countless hours of market study, including the review of thousands of survey responses, as well as list price and sold price data from literally hundreds of thousands of transactions.

And the research is clear: pricing a house for sale correctly from the start is one of the most important factors in ensuring that the house sells quickly and for the highest price possible.
The very best agents know the secrets to pricing a house right. And now you will, too.

In this video, we’ll explore how the market determines price, the value of improvements, alternative pricing strategies, and what it takes to make the most of changing market. Armed with this information, you and your real estate professional will be able to make the best, most informed decision possible.

All of the text and video for this post was originally created and published by Keller Williams Realty

A Tip for Sellers

Another informative video brought to you by:
Keller Williams Realty

Some unsuccessful sellers try to “test the waters” by pricing the house to high with the hopes that they’ll find a buyer who’s willing to pay more than the house is worth.

The worst mistake a seller can make is thinking that there is no harm in price reductions later on. This is a classic pitfall that can lead to actually getting less for the house than it was worth to begin with.

Sometimes price reductions are necessary, especially if your house isn’t getting offers. But price reductions are a fall-back strategy, because they have drawbacks.

Price reductions can make a buyer think one of three thoughts:

1. What’s wrong with this house
2. Let’s wait to see if they lower it more
3. Let’s put in a low-ball offer to see how low they’ll go.

If your house does sell after price reductions, it could actually be for much less than you would have gotten if you’d listened to the market.

All of the text and video for this post was originally created and published by Keller Williams Realty

A Tip for Sellers

Another informative video brought to you by:
Keller Williams Realty

If you’re thinking about making repairs to your home before selling, talk to your agent about which repairs are necessary and which might not be.

If you’ve made significant improvements to your home to make it into your dream, you probably already know that you’re not going to get full-value for these improvements at resale.

In fact, (graphic: according to a recent study published in Remodeling Magazine 2010-2011) aside from replacing the front door, no home improvement project gave back more than an 85% return on investment. At best, that’s a 15% guaranteed loss on your money.

Recent improvements can help your house make a buyer’s short list, but to first catch the buyer’s attention and then to be the one the buyer ultimately chooses, pricing matters most.

So, be sure to speak to your agent about what features matter before you do anymore repairs to your house

All of the text and video for this post was originally created and published by Keller Williams Realty

A Tip for Sellers

Another informative video brought to you by:
Keller Williams Realty

To sell, your house has to prove its value to three people: the buyer’s agent, whose job it is to scout for the best homes in the buyer’s price range, the buyer, who selects from these homes, and the lender, who decides whether the home is actually worth the price.

Your real estate professional will take all this into consideration when helping you set the list price. To do this, your agent will create what is commonly referred to as a Comparative Market Analysis, or CMA.

A comparative market analysis allows your agent to analyze your most up-to-date local market conditions by factoring in those houses that have recently sold; houses that have recently been placed on the market, or “listed”; houses that have expired or have been withdrawn from sale, and houses that are under contract — or “pending.”

Let’s look at each:

Active Listings: these are listings that are currently on the market. Some sellers make the mistake of looking strictly at active listings as a basis for setting their list price. The problem with this strategy is that the only thing we know about active listings is that they have not sold. So while knowing what your competition is selling for is part of the puzzle, it’s not the only piece.

Withdrawn and expired listings are much like active listings. These homes haven’t sold either after being on the market for some time and, in some cases, even going through several price reductions. Usually, these homes were overpriced or had major issues that deterred buyers.

By analyzing the records of withdrawn and expired listings, your agent can determine where those pricing strategies went wrong. That information can help you see the power of getting the price right at the outset.

Your agent will also analyze sold and pending listings. Unlike actives, expired, and withdrawn listings, sold and pending listings can show what prices are attracting buyers and getting offers.

Your agent’s comparative market analysis will help you to determine where the market has been, where it is going, and where it’s not. To be a successful seller, you’ll need this knowledge to know where to set your price.

All of the text and video for this post was originally created and published by Keller Williams Realty

A Tip for Sellers

Another informative video brought to you by:
Keller Williams Realty

So how do you know if your home is in the market or out of it? It’s really as simple as showings and offers.

If you think you’ve priced your house right, and you haven’t had any showings, the market is telling you that you’re “out” of the market.

But what if you’ve priced it so that you’re getting showings, but no offers. Statistics show that if your house has been listed for two weeks with showings but no offers, you’re in this area: no buyers’ land.

It’s in this area that you’re attracting the attention of buyers, but you’re only helping to sell the house down the street. What’s more — Research shows buyer interest in properties generally declines sharply after the first several weeks. That means that showings without offers in the first two weeks are not only selling the competition—they mean you are going to lose buyer attention quickly in the very time when you need it most. Your goal is to get an acceptable offer early.

So … if you’ve got no showings and no offers in two weeks, you’re probably out of the market. If you’ve got showings but no offers, you’re closer, and maybe “on” the market, but not close enough to be “in” the market.

Once you’ve got your house “in” the market, all the tools your real estate professional has can be used to get you the most amount of money, in the least amount of time, with the least amount of hassle.

All of the text and video for this post was originally created and published by Keller Williams Realty

A Tip for Sellers

Another informative video brought to you by:
Keller Williams Realty

Just being ON the market is not the same as being IN the market.

To get a sense of this, let’s look at a graph of houses on the market at any point in time. Here we have two criteria, price and condition. Taken together, price and condition equal value. The level of value determines where the house can be found in the graph.

Let’s look at the price. Houses at the top of this line are priced above market value.

At the bottom are the houses that are the most aggressively priced. Discounted properties like foreclosures and short sales can be found in this area of the graph.

The other criterion is condition. On the right hand side, you have those homes that need the most work. They are in the least competitive condition and they haven’t been staged well.

As you move to the center, you’ve got those homes that are in pristine condition. Think brand new homes — or homes that don’t need any work.

Buyers looking for homes in a certain area, in a certain price range will get updates from their real estate agent about which houses are available right now.

And you can be sure that buyers pretty quickly determine which houses are “in” the market, and which are “out” of the market.

In 2005, the market had expanded so that the market of houses that were “in” the market was much larger. Buyers would consider purchasing properties inside this whole area. And the houses in this area were attracting offers — and they were selling.

In a buyer’s market, this area contracts. A relative flood of foreclosures and short sale properties have shifted the picture in many markets, creating powerful price competition. This means a house that was in the market just several years ago is now out of the market.

All of the text and video for this post was originally created and published by Keller Williams Realty

A Tip for Sellers

Another informative video brought to you by:
Keller Williams Realty

Even the best houses on the market still face the issue of getting buyers’ attention to show them that it’s better. And that comes down to price, because that’s how buyers search for homes.

Today almost 90% of buyers use the internet to search for homes. And the majority of agents use the internet to notify their clients of the best homes.

Let’s consider how a typical online home search is conducted and you’ll immediately see why it’s important to price your home correctly.

The average home buyer enters in just a few search criteria: price first, and then number of bedrooms and bathrooms. And from those three items, a typical MLS will display hundreds, maybe even thousands of homes that meet the buyer’s needs. From that list, the buyer and their agent quickly scroll through to find the few homes that they want to visit in person.

Search results group homes in price “brackets” or ranges—which may be ten thousand dollar or twenty-five thousand dollar increments. It varies. But the fact that these brackets exist and drive what buyers and their agents see is critical in pricing right.

When you price your home out of its optimal price bracket, a buyer sees homes in the next price bracket, which may be larger and have more features and amenities in comparison to your home.

Effectively what you’re doing is ensuring that people who search in the higher price bracket will find your home among hundreds of other homes that may be newer, bigger, and perhaps have more amenities.

And keep in mind that the buyer and the buyer’s agent are eliminating choices immediately without ever setting foot in the home — based only on online descriptions that put your home at a disadvantage. By pricing your home in the next price bracket, your home could be eliminated, without ever being seen by the right buyer.

What’s worse, the right buyers — those searching for a home just like yours, and all that your house has to offer, may not even see your home in their search results and wouldn’t have the opportunity to make it one of the few they tour in person.

To compete and win, your house has to offer the most room and amenities for the best possible price compared to competing sellers’ houses.

All of the text and video for this post was originally created and published by Keller Williams Realty

A Tip for Sellers

Another informative video brought to you by:
Keller Williams Realty

Real estate markets change all the time. You want to make sure that you’re pricing the house ahead of the curve — no matter what the market.

Let’s look at a real world example. A house priced $100,000 is for sale in an area that is seeing price declines of 5% every three months. And it takes about 3 months for a house priced at $100,000 to sell.

That means the same house might be listed three months from now for $95,000.  To price the house right, a real estate professional might recommend a list price of $95,000 now, to ensure that the house remains competitive with new listings.

All of the text and video for this post was originally created and published by Keller Williams Realty