This is Al Filippone’s third installment on critical home selling mistakes. For part 1 go here, for part 2 go here.
Re-Financing Appraisal:
An appraisal is an opinion of value for a certain purpose. If the lender wants to lend you money, they may estimate a slightly inflated value for your home in order to justify their equity position. The appraiser may ignore foreclosure or distress sales in order to substantiate a higher value. However, real buyers in the real world will not. These homes are your competitors when you try to sell. Don’t make the mistake of thinking that the value you were told when you refinanced is what a real buyer would pay for your home today.
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Failure To Adjust The Price When The Market Resists It
One opinion of value may have more validity and sound reasoning behind it than another, nontheless a market analysis is nothing more than a hypothesis, an intelligent estimate based on empirical data. The bottom line is that a homeowner, appraisor or Realtor have marginal control over what a home will sell for. The market will determine the price, and your home will sell for what someone is willing to pay for it. My advice regarding price adjustments, if your home doesn’t sell within the first thirty days at most, is to do the following:
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- Frequent showings but no offers – A 5% adjustment.
- Very few showings – A 10% adjustment.
Using The “Hard Sell” During Showings
The most beneficial thing that you can do when your home is being shown is to get as far away as possible. Buying a home is an emotional decision. Buyers like to ”try on” a home to see if it feels comfortable to them. It is akward doing that when the homeowner is present. In fact it often has the opposite effect by making the buyers feel that they are intruding on your private space. If you make yourself scarce, it will impede the buyer from asking questions and involve discussion that may not be in your best interest.
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