Aug 04

Money Matters by Mom2KG

Our regular columnist, Mom2KG, returns to give some practical tips on selling your home in the first of a two part post. Her next post will be on buying a home. Please note that I am a week long blogging vacation. Hope you enjoy today’s post and I’ll see you next week. Enjoy.

I recently bullied my husband into selling our house and buying a new one. One day, he was yelling “We are not buying a new house!” in response to an open-house brochure I proffered, and the next, we were putting an offer in on a fixer-upper. OK, it wasn’t quite from one day to the next, but we did move things along pretty fast. Here are my tips on selling a house. Next post - tips on buying.

Get on the same page. I believe my past posts illustrate how emotional money management can be between spouses. Since homes are often considered a family’s biggest asset and investment, it makes sense that parting with one must be a mutual, happy decision. (I’m a complete hypocrite here. I really did bully him.)

Sell first, buy second. Selling first is the less-risky move, obviously. At worst, you don’t buy and have to move in with your in-laws. But buying and not selling puts you at serious financial risk-you can’t get bridge financing until you sell. In the current housing market, you need to sell first, and determine what you can afford to buy.

Find an agent. I interviewed three agents. None of them thought the house was worth what we thought. TIP: agents would rather sell a house fast than sell for more. It means a lower commission, but less work, which means they can take on more listings for greater revenue. Anyhow, we went with the agent who seemed most willing to listen to us, gave practical advice, and negotiated her commission down.

Do you homework. We had to prove to our agent the house was worth more. The “comparables” were limited at a passing glance, but a more detailed analysis gave us confidence that we were selling something extremely desirable, even though our house is on the “wrong side of the tracks.” We pushed the agent to a higher price point. Worst that happens? You don’t get it and drop the price in a few weeks. On the flip side of that coin, if you are selling a cookie-cutter new build in a neighbourhood full of “for sale” signs, be prepared not to get the top price.

Finish your housework. Take an extremely hard look at your home. What needs to be done? You must finish anything not completed in the way of renovations. Repair cracks, wash crayon off the walls, and clean, clean, clean.

De-personalize. Buyers don’t want to see your family photos. De-clutter, and put away all personal items, as well as kids’ toys, the cat litter box, folded laundry, etc. Buyers need to see themselves living there, which is really hard with Uncle Ron looking at them from the mantle (When we looked for our first home, the owner had oh-so-casually left out pictures of himself with then-President George Bush at a golf tournament. Seriously?)

HIRE A STAGER. Invest the money (and some time) in a home-staging service. This can run into the thousands, but let me assure you: it is worth every penny! Stagers will view your house with an unemotional, critical eye, and help you de-clutter and get your house in viewing shape. Ours had us re-paint in neutral colours, re-arranged furniture and art, provided several accessory items, and even shopped for things we were missing (like lamps). By the time they were done, our home was a showpiece. No one lives like that, but buyers were completely entranced. We sold our home over the asking price, in a bidding war, in three days. We attribute much of that to the home-staging. Just trust me on this one. It feels like a splurge, and it may be a bit of a pain, but it will maximize the selling price.

5 Responses to “Money Matters by Mom2KG”

  1. jack Says:

    find an agent – it sounds like you went with the agent that told you what you wanted to hear..many people over price their house and wonder why it sits on the market, I agree, that a lot of agents just want to sell but dont confuse that with over pricing.

  2. Potato Says:

    “Worst that happens? You don’t get it and drop the price in a few weeks.”

    I don’t know if I’d be so quick to dismiss the worst-case scenario of mispricing. Selling a house is a tricky game with lots of psychology involved in the negotiations. You got lucky and had a bidding war, which is the fastest way to get top dollar, and over your asking price. Bidding wars generally only happen on a fresh listing, so if you put your asking price too high you probably won’t get a bidding war. If you’re so high that you have to drop your price then you’re losing even more negotiating power: now you’ve put into the buyer’s mind the idea that the price is on the way down, plus the listing is stale, which takes away the sense of urgency that helps get people to put in high offers to grab it while it’s hot. On top of that a “new price” sign might tell a buyer not that you mispriced your initial ask, but that you’re a “motivated seller”, leading them to push you even further. On the gripping hand, there is value in selling your place quickly; while probably negligible compared to squeezing just a few more percent out of your house, it is miserable to live in a staged home, having to keep it meticulously clean and ready for a showing at a moment’s notice, for months on end. As you said yourself, “No one lives like that…”

    While in your case you might have been right and the agents wrong, I’d caution anyone going against the advice of three different agents to be very sure of their analysis before shooting the moon with their ask.

  3. Mom2KG Says:

    Thanks for the comments. I think I need to write more on the agent issue.

  4. Sveta Says:

    Well, I totally agree. I am a Home Stager and everything MOM2KG said, I tell my clients as well. I can only speak for myself, but, on average, the houses I staged, sell in 30 days (instead of 70 days local average in the last year) and for between 95% and 98% of the asking price. GOOD JOB!!!!

  5. Thicken My Wallet » Blog Archive » Money Matters by Mom2KG Says:

    [...] my last post, I spoke about tips to sell your home. This follow-up will give you some tips on buying a [...]

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