BRAD NELSON
69 Bolton Street BOBCAYGEON, ON K0M1A0
Mobile: 705-738-2110 Email BRAD

What to consider when selling


 

“What every home owner needs to know

 

 

when selling their home”

 

 

 


Why Are You Selling?

The first question you should ask yourself is "Why am I selling?"

Are you selling because you want a bigger home, or smaller home? Are you being transferred by your job, looking for a better neighbourhood or community? Perhaps you’ve come into some financial trouble and have to sell right away. Or, you want to get your equity out of your house now and buy something else.

Determining your motivation for selling will also help determine the amount of time you have to accomplish that. And, when putting your house on the market, timing is everything. One important factor to keep in mind is that no matter what your situation, you want to price your house right.

4 features that determine highest price

  • Location – The value of a house not only varies on the desirability of a city, but also what neighbourhood it is in, and what amenities are located nearby. (shopping, transportation, school, quality of waterfront, views, privacy etc.).

  • Features – Upgrades and special features of a house add value as well. Things like a pool, spa, bay window, view, bedrooms, square footage, remodelling, etc. all affect the highest possible price.

  • Condition – Overall condition has a great impact of what the "perceived" value is. The better maintained a house appears to be, the more confident a Buyer will feel offering full value because it gives the impression that you have taken very good care of not only things that are obvious, but also things that are not.

  • Market timing – Is it a Buyer’s market or Seller’s market? Knowing the current market conditions will impact what the highest possible price for your house can be. Also, what cycle is the economy in? Prosperity or recession?


CMA- what is your house worth?

A Comparative Market Analysis, or commonly known as a CMA, is report generated from recent real estate activity in your neighbourhood. Your home is compared with similar homes in your neighbourhood in three levels.

The first is properties that are currently for sale. These are properties you want to consider carefully because not only are they "actively" your competition, but, they give you a good idea of what other sellers in your neighbourhood are anticipating to sell their house for.

The next level is properties that are "pending" close of sale. This means that the property is sold and pending closing. Although these give a good indication of what type of properties are moving in the market, with regard to price it doesn’t determine what it actually sold for because price is usually not released until the close of escrow.

The third level is properties that have already "sold," meaning successfully completed sales. This is probably the most important to consider of all three because it plainly lets you know what buyers are paying for homes like yours.

Benefits of Proper Pricing

· Faster Sale: The proper price gets a faster sale, which means you save on mortgage payments, real estate taxes, insurance, and other carrying costs.

· Less Inconvenience: As you may know, it takes a lot of time and energy to prepare your home for showings, keep the property clean, make arrangements for children and pets, and generally alter your lifestyle. Proper pricing shortens market time.

· Increased Salesperson Response: When salespeople are excited about a property and its price, they make special efforts to contact all their potential buyers and show the property whenever possible.

· Exposure To More Prospects: Pricing at market value will open your home up to more people who can afford it.

· Better Response From Advertising: Buyer inquiry calls are more readily converted into showing appointments when the price is not a deterrent.

· Higher Offers: When a property is priced right, buyers are much less likely to make a low offer, for fear of losing out on a great value.

· More Money to Sellers: When a property is priced right, the excitement of the market produces a higher sales price in less time. You NET more due to the higher sales price and lower carrying costs.

Drawbacks of Overpricing

· Reduces Activity: Agents won’t show the property if they feel it is priced too high.

· Lower Advertising Response: Buyer excitement will be with other properties that offer better value.

· Loss of Interested Buyers: The property will seem inferior in amenities to other properties in the same price range that are correctly priced.

· Attracts The Wrong Prospects: Serious buyers will feel that they should be getting more for their money.

· Helps The Competition: The high price makes the others look like a good deal.

· Eliminates Offers: Since a fair priced offer will be lower than asking price and may insult the seller, many buyers will just move on to another property.

· Causes Appraisal Problems: Appraisers must base their value on what comparable properties have sold for.

Lower Net Proceeds: Most of the time an overpriced property will eventually end up selling for less than if it had been properly priced to begin with, not to mention the extra carrying costs.

 

PRICE is the #1 most important factor in the sale of your home.

 

Pricing guidelines

· What you paid for your property does not effect its value.

· The amount of money you need to get out of the sale of your property does not effect its value.

· What you think it should be worth has no effect on value.

· What another real estate agent says your property is worth does not affect its value.

· An appraisal does not always indicate what your property is worth on the open market.


 

The value of your property is determined by what a ready willing and able buyer will pay for it in the open market, which will be based upon the value of other recent closed sales. BUYERS DETERMINE VALUE!!

 

DO NOT automatically list with the agent that gives you the highest price.

Consumer Reports, July 1990 stated…

“Expect the agent to suggest a price range, but don’t let that frame you in. Be aware that some devious agents will, at first, suggest a very handsome price. Then, after they have the listing and the house hasn’t sold, they’ll come back with a pitch to lower the price.”

The pricing triangle represents all of the potential buyers in the market for a given home. The higher your asking price is on the triangle, the lower the percentage of buyers who will be interested in purchasing it.

As the asking price increases toward the peak of the triangle, the number of potential buyers who are willing to pay a premium price for the home declines, until the buying public perceives that the price is so high that no prospects are attracted at all. As the price declines toward the base of the triangle, the home is perceived to be a “bargain”, and the number of potential buyers increases.

Ideally, you should price your home in the range of actual fair market value. Your sales associate can help you determine this range with a Comparative Market Analysis. Setting a fair asking price helps you obtain the maximum selling price for your home.

How will I know if my home is priced right?

You will know right away. Real estate agents are working with buyers right now who might be interested in buying your home. When a new listing appears in the MLS, agents want to be the first to show their client the home, if it meets the client's criteria. You should have a flurry of activity during the first 10 days. If you don't, let's talk!

Sales agents are constantly on the alert for new properties to show to their active, qualified buyers. As a result, the majority of showings by sales agents on a new listing occur when the house is first placed on the market. Once this group of agents and buyers has seen the property, showing activity decreases to only those buyers new to the market. Therefore, it is important to position your home at the best price during the first market exposure.

Many sellers think that an overpriced property simply can be reduced if it doesn’t sell. The danger with this approach is that by the time the property is finally reduced to its market value, it may have been on the market so long that buyers perceive it to be a tainted property. Buyers then question how long the home has been on the market and why it hasn’t sold. Their offer to purchase, based on that knowledge, may be below its actual value.

As real estate professionals, we use market research to arrive at an initial price that is both realistic and fair to you as the seller but also attractive to buyers. This pricing process, takes into account a number of key factors, which include property location and condition, as well as the market history and current activity, reason for selling and market timing. For detailed information and pricing strategies for your property call Brad Nelson.

Beware of agents "Buying the listing"

When you have agents come over to provide a market analysis of your house, generally they will all be giving you the same price range. Sometimes, this price range will be less than you had hoped to sell your house for.

Then, there might be one agent that, regardless what the comparables are showing your house should sell for, will agree to list your house at the higher price you want. Then as time passes, and the house has not sold, they will periodically reduce the price and eventually will be at the price the other agents were stating that it should sell at. Or worse, it could sell for less because now time has passed, and you really need to sell the house quicker. But, by this time your house has been exposed to the market for some time and is no longer a "new" listing. The longer a house is on the market, the more suspicious Buyers and Agents are of why it hasn’t already sold.

This practice is called "Buying the listing." It is unethical and a disservice to the client. Some agents in the industry use it to just get more listings. Be careful you don’t fall into this. If more than one agent is telling you the same general price range your house should sell for, whether you like it or not, it’s better to list at the suggested price range and save yourself from the anguish and frustration of an agent that bought your listing.

Selling your house "as-is".

Selling you house "as-is" means that you are selling the house in its current physical condition. If you don’t want to bother with doing too much work to the house to make it ready for the Buyer, then this may be something to consider. However, this does not exempt you from disclosing everything you know about the property.

When selling your house "as-is" consider that you will have to price accordingly. If a house down the street is selling for the price you want, but that house has upgrades, different features and is in better condition, you can’t very well expect to get the same price.

When you’ve sold your house, the Buyer will usually have a home inspection performed on the house, if not by a hired professional, then by himself or herself. Whatever the results of that report, there are always issues that concern the buyer. These issues will be addressed in the form of a list of repairs you will be requested to complete. At that point, the buyer and seller will need to reach mutual agreement on these repairs to continue towards a firm sale. However, if selling a house in "as-is" condition, there is rarely much the buyer should ask for.

Make your "home" a "house"

The first step to getting your house ready for sale is to "depersonalize" it. This means you’ve got to put your emotions aside, detach any sentimental value you hold with the house, and put away all personal items. Your "home" will now become a "house" for sale. You want to start calling your property a house, and you want the buyer to call it home. In order to achieve this, you should take a good look around your house and get rid of things that mark it as your home. Family pictures, personalized plaques, trophies, and toys.

When a buyer walks through your house, you want them to make an emotional connection. They should be able to envision their own children playing in the yard, or see their own family pictures and paintings hanging on the walls. If you have your house full of your own personal items (and this includes knickknacks), the buyer will feel like they’re imposing on your "home," looking at family pictures, rather looking at their own potential home. Buyers buy a home based on emotion. They fall in love with a property because they can see it as their "home," you want to play into that as much as possible.

Hey, you’re going to be moving soon. Might as well start packing by starting with the personal stuff. After that, start packing the "clutter."
If you would like professional advice regarding what you should and shouldn’t keep out, call us today for a free consultation. We’re Realtors, Real Estate is our job.

Remove the clutter

The next thing you’ll want to do is go through every cupboard, closet, underneath beds, attics, crawlspace, garage, nook and cranny. Anywhere you might have started a collection of "stuff." Evaluate some of that stuff that’s been sitting there, untouched, for years. Do you really "need" to keep it? If so, put it in a box and send it off to storage. If not, then it’s time to throw it away, donate it, or sell it.

There are two good reasons you want to do this. First, the less stuff you have crammed into closets and cupboards, the more space the house shows to have. You want the house to appear as if there’s plenty of storage space for the Buyer’s own stuff. If the Buyer happens to open up a closet, and stuff is falling out, that gives the impression that perhaps there isn’t enough space in the house, like they would like to have. Plus, it might also give the impression that you’re not very tidy, and that can concern the Buyer as to what kind of condition you’ve kept the house in.
Besides, starting early with packing a lot of the "clutter" will it make much easier to pack the rest of your house once you’ve sold it.

If you would like professional advice regarding "clutter," call us today for a free consultation. We’re Realtors, Real Estate is our job.

A house should look Open and Spacious

One thing Buyers always look for is an "open and spacious" floor plan. This can easily be achieved no matter what the square footage of you house.

Along with packing up the clutter and personal items, take a good look around your house and determine if there is any furniture you can pack up and put in storage as well. Or, perhaps just rearrange it, so it gives an "illusion" of more openness to your house. Calling a Realtor to see your house can help. We can consult with you as to what you should do with your furniture to maximize the appearance of your house. Next to "curb appeal," this is the next most important thing you want done well to maximize the Buyer’s first impressions of the house.

Curb Appeal

The first thing that Buyers see as they pull up to your house is the exterior, for many Buyers, this is a deciding factor alone of whether they even want to go inside. This is what we call "curb appeal." Does the exterior of your house look inviting enough that, even if the interior isn’t all that great, the Buyer might still consider buying the house?

There are a few inexpensive things you can do to spruce up the exterior. First, take a good look around the outside of the house. Are there any cracks that need filling? Does the house need touch up stucco, paint, or siding? Walk across the street to take a good look at your house, and compare it to the neighbour’s house. If it’s looking a little faded, maybe a paint job is order. Remember, you’re moving out of this house, so don’t choose an outrageous colour. Keep it neutral, if you live in a tract development, look around and choose the most common colour being used.

Also, a nice and neat yard is always appealing. Keep the lawn watered and neatly manicured. Sometimes planting some flowers can really spruce up a front yard. Buy some inexpensive, matured, potted plants to put by the front door. You want to avoid planting anything like seeds or bulbs because not only will they take too long to bloom, but also when buyers come to your front door all they’ll see is dirt.

What repairs should I do?

Paint

Painting the interior is inexpensive and can really justify value to your house. Make sure you keep the colour neutral. Using an off-white colour will brighten up the walls and make them look new and clean. Avoid using any favourite colours that match your furniture and your own colour scheme. Remember, your moving out of this house, so don’t "personalize" it.

Carpet

Should it be replaced? Many sellers agonize over this issue. Take a good look around and inspect the condition of the carpet. Sometimes, just calling in a professional carpet cleaner can really make a difference. However, if you have a certain colour of carpet (like burgundy or green), and it’s faded, you may want to consider offering a "carpet allowance." A carpet allowance is usually better to offer than replacing it yourself. A carpet allowance means you take what you would have spent replacing it yourself and offer it the buyer. This is sometimes better for a few reasons. First the buyer sees it as an incentive, and second, it gives the buyer a little joy knowing that they get to pick out their own carpet (much like buying a brand new home). Plus, you really are better off letting the buyer handle the carpet replacement because, even if the colour is right, they could still complain about the quality.

Windows and Screens

Be very careful to look over windows and screens. If a window is cracked, replace it. Is there a torn window screen? Replace it. The buyer will have their home inspector go through the property to look for things like this, and more than likely they will want these things fixed anyway. So rather than trying to get it done when you are doing many other things, like packing and looking for your next home), you will already have that done.

Fixtures

If there is anything attached to the house that you want to take with you (like a chandelier that’s been in your family for years) make sure you take it down before buyers start coming through. According to the purchase agreement, fixtures are included unless you make it very clear from the beginning that they are not. Even then, it may cause miscommunication problems. So, it’s best to avoid them from the beginning.

Some fixtures you want to consider replacing or adjusting are faucets, cabinet handles, and door handles, toilets, electrical outlets, doors, etc. These little things are inexpensive and can really spruce up the house throughout. If these items are in good condition, then perhaps a good polishing is in order.

Keeping the house clean and ready to show

When you have your house on the market for sale, you should maintain it a tidy fashion. And, be prepared to show the house within thirty minutes, because, sometimes other agents may be out with their buyers and happen to drive by your house, and would like to show their buyer your home at a moment’s notice.

Also, a clean home shows pride of ownership. A home that shows it has been kept well gives the impression that other things that cannot be seen have been taken care of as well.

Lights and a good smelling house

A light home is a happy home. When someone comes to show your home make sure to turn on all the lights and open all the windows. A dark home will seem smaller, unpleasant, and depressing.

Also while your home is on the market it’s a good idea to us air freshener, potpourri or Plug-ins to keep the house smelling fresh.

What shouuld I do when agents show my house?

When possible, you should temporarily leave the house. However, this isn't always convenient. So, instead step outside in your back yard or in the garage while the house is being shown. One reason is so that the buyer and their agent can freely speak and see the house and feel comfortable. Another reason, is that you don't want the buyer and agent bothering you with questions.

Anything you say can be used against you in an offer they might make.

CONTRACT & NEGOTIATION

When an offer is presented on your home, you will have three basic choices in deciding how to respond.

1. Accept the offer.
2. Reject the offer.
3. Make a counter offer.

Together we will thoroughly analyze the offer, and discuss its strengths and weaknesses. After studying the entire contract, I will give you my recommendation, and then you will decide how to respond.

This is where a competent agent can be worth their weight in gold, because having the right wording or contingency clause in the contract can mean the difference between a smooth transaction and a messy court battle.

Being intricately familiar with real estate contracts, I know how to protect your best interests. My vast experience in contracts and negotiation will benefit you!

Do not be offended by an offer

When a buyer makes an offer that is low, do not be personally offended. It is common place for buyers to start low and try to end up somewhere in the middle. So rather than refusing to negotiate, you should counter their offer and try to find that middle ground that you would both agree on.

Choosing the best offer

When choosing an offer, consider all of the terms, not just the price. Terms such as closing date, conditions, costs a buyer may be asking for, and how strong their financing is. Financing is a major concern because, even if they give you full price with the terms you want, it means nothing if they can't finance the home. We as Realtors will help you assess every offer and we'll help you determine which one is the better offer.

Accepting the offer

Once you have accepted an offer you are committing to sell your property to that buyer. So, be sure that you understand a purchase agreement is a legal binding contract. And that everything in that contract must be fulfilled.


Inspections and results of inspections
Generally home inspections are included as a condition of sale for residential property.

A home inspection, can be done by the buyer, but is usually done by a professional home inspector that the buyer hires. As a result of a home inspection, some things may be discovered that the buyer wants fixed. These things the buyer wants fixed need to be submitted in writing. The repairs that will be done are subject to negotiation.

 

Showing Tips

You want your home to be presented at its best to potential buyers. Here are a few tips for preparing and showing your home.


"Curb appeal" is the first impression a buyer has as they drive up to your home. The yard should be free of weeds, shrubbery/trees pruned, grass mowed, and granite raked. A few seasonal flowers near the entry/walkway brightens up the yard.

  1. If your home needs painting – consider painting it!
  2. If your carpet is in good condition but needs cleaning – clean it!
  3. If you have some deferred maintenance on your home (cracked window, dripping faucets, etc), you might as well fix it now because the buyer will probably ask you for repairs as a condition to buying your home.
  4. A pleasing aroma in the house goes a long way – maybe some potpourri or a drop of vanilla extract on the electric range burner sure smells great.
  5. Clean out or clean up the garage – buyers may actually want to park cars there.
  6. Clean out overstuffed closets.
  7. Too much furniture in your home? Rent a storage unit to temporarily hold excess furniture or closet clutter.
  8. Keep the kitchen and bathrooms neat and clean – clean the oven, remove all the photos and magnets from the refrigerator, put counter-top appliances in cabinets, replace the crusted-over electric range burner bibs.
  9. Give the kids a little extra allowance if they keep their rooms tidy.
  10. Open the drapes/blinds when your home is shown – the brighter, the better!
  11. Turn on all the lights when a buyer is coming to see your home. It sounds silly to turn on the lights during the day but the extra light fills shadows and adds brightness.
  12. Have your homeowner’s association booklets available.
  13. When an agent and buyer show up to see your home, take a walk to the neighbour’s house – it makes the buyer more comfortable as they look through your home.
  14. If you have valuables or guns, take them out of your home while it is for sale – maybe the bank safe deposit box. Most people are honest but you never know!
  15. Secure your prescription medications – yes, thieves sometimes pose as potential buyers. (as important: Medication often suggests that the reason for moving is dire, and that you might be vulnerable to below market offers.)
  16. If the pool is green or brown, instead of blue, take some water samples to the pool store and ask for help.
  17. If you have a scary pet (big dog, snake, tiger, etc.), please be certain they are contained or restrained while a buyer and agent are on your property. A warning sign may also be a good idea. If a real estate agent senses danger, they will not enter your home.

 

What will help me sell my home at the highest price in the least amount of time?

It requires a balance of marketing and home pricing to accomplish both objectives. You need to be careful not to over-price your home (and drive away potential buyers) or under-price your home. Experience tells us that homes that are priced "right" sell at the highest price in the least amount of time.

I don't care what the CMA indicates; I want to sell my home at a much higher price.

Buying and selling homes is really a process of "checks and balances". The seller wants to sell at the highest possible price and the buyer wants to buy at the lowest possible price - the real estate agent is the impartial party to the transaction who advises their client based on the current market conditions. Let's say you want to sell your home at 10% above the market value. Let's look at what needs to happen for you to sell your home at that higher price:

  1. An agent will have to select your home to show to a buyer even though it is priced higher than other homes in the area, AND

  2. The buyer will have to intentionally overbid for your home even though the CMA which the buyer's agent prepared shows the comparable sales and the market value lower, AND

  3. The lender's appraiser will check the comparable sales and will have to intentionally misrepresent the comparable home values, thus producing a fraudulent appraisal on your property (this appraiser is in big trouble).

The odds aren't good that ALL 3 of these scenarios will happen at the same time. The moral of the story: if you set a realistic market price on your home, it will sell.

How will I know if my home is priced right?

You will know right away. Real estate agents are working with buyers right now who might be interested in buying your home. When a new listing appears in the MLS, agents want to be the first to show their client the home, if it meets the client's criteria. You should have a flurry of activity during the first 10 days. If you don't, let's talk!

I just spent $2,000 to have my home painted. Can I add that cost to my list price?

Painting, plumbing repair, carpet replacement, and similar items are routine maintenance activities with any home. The cost of these activities does not contribute one-to-one to the sales price of a home. However, a well maintained home will help you sell your home sooner and justify a high market value because the buyer knows they won't have to spend money to perform the maintenance.


Broker Representation

You have the full knowledge and experience of a real estate brokerage on your side and we will represent you as the seller’s agent. We will maintain absolute confidentiality and perform our duties under your direction and consent.

  1. We will negotiate on your behalf.

  2. We will show your home to financially-qualified potential buyers.

  3. We will book/ confirm all showings as per your instructions.

  4. We will provide our opinion on pricing

  5. We will write purchase offers and contracts

  6. We will evaluate the quality of purchase offers and make recommendations to you

  7. We will provide a financial worksheet showing your sales price, estimated closing costs, and your net proceeds from the sale.

  8. We will ensure all disclosures are provided per the contract and applicable legislation.

  9. We will coordinate closing activities with you, the buyer, the buyer's agent, and lawyers as needed.

  10. We will schedule and coordinate home inspections and appraisals.

  11. We will coordinate the buyer's financing

  12. We will do our absolute best to ensure a timely and stress-free closing.
     

    Announcing Brad Nelson’s
    EASY EXIT LISTING AGREEMENT

     

    What’s your biggest fear when you list your home with a real estate agent? It’s simple. You worry about being locked into a lengthy listing agreement with a less than competent real estate agent, costing your home valuable time and exposure on the market.

    Well, worry no more. Brad Nelson takes the risk and the fear out of listing your home with a real estate agent. How? Through my EASY EXIT Listing Agreement.

    When you list your home through our EASY EXIT Listing Agreement, you can cancel your listing with us at any time. No hassles. It’s easy.

  • You can cancel your listing anytime

  • You can relax, knowing you won’t be locked into a lengthy contract

  • Enjoy the calibre of service confident enough to make this offer
     

    Only one restriction applies…I ask that you voice your concern and give us seven (7) days to try and fix the problem. That seems fair, doesn’t it? If we can’t fix any concerns within the seven-day period, you are free to withdraw your listing.


    I have strong opinions about real estate service. I believe that if you are unhappy with the service you receive, you should have the power to fire your agent.


 

Brad Nelson- Real Estate Broker