Fall is known among real estate professionals as the second-best season of the year to sell homes. The reason is the second-largest numbers of prospective buyers are in the house and condo purchase market from now until Thanksgiving.
2005 might prove to be an especially good year to sell your home, if you want top dollar, because many prospective buyers realize they should buy before mortgage interest rates rise further.
Purchase Bob Bruss reports online.
Just in case you are wondering, spring is the best season for home sales because that is when there are the most prospective buyers in the market. But with home sales volume and median sales prices still at record nationwide levels, according to the National Association of Realtors, this fall promises to be a robust home sales season in most communities.
HOW TO TAKE ADVANTAGE OF TODAY’S HOME SALES MARKET. If you are thinking of selling your house or condo, now is the time to act. The first step is to be sure you really want to sell and have a strong motivation for doing so.
The second step is to get your home prepared for sale. Look at it critically, through a prospective buyer’s eyes. Painting (inside and outside), repairing and cleaning will usually pay off in thousands of extra profit dollars. Pay special attention to the kitchen and bathrooms, but don’t go overboard with major renovation.
If you can’t afford minor fix-up, then sell your home “as is” but with the knowledge you probably won’t get top dollar. Most home buyers want to turn the key in the door and move in. If your home needs considerable work, many prospective buyers won’t be interested, except at a heavily discounted price.
The third step is to interview at least three successful realty agents who sell homes in your vicinity. Even if you think you want to become a “for sale by owner” (known as a FSBO or fizz-bo), the agents you interview won’t mind. The reason is they know most do-it-yourself home sellers give up after 30 to 60 days, usually listing with an already-interviewed realty agent.
KEY QUESTIONS TO ASK THE THREE PROFESSIONAL AGENTS. After your home is ready for sale, it’s time to interview the three successful agents you select. The reason to interview at least three agents is to compare their pros and cons. Then you won’t be misled by a charismatic agent.
1. HOW MUCH CAN YOU GET FOR MY HOME? Be blunt. Notice the question is not: “How much do you think my home is worth?” As a savvy home seller, you want each agent’s expert opinion how much he or she can get for your home.
To justify his/her answer, each agent should prepare for you a written CMA (comparative market analysis). The CMA form shows (a) recent sales prices of comparable nearby homes, (b) current asking prices of neighborhood homes listed for sale (your competition), and (c) asking prices of recently expired comparable listings that didn’t sell (usually because they were overpriced).
Don’t feel you are being unreasonable insisting each agent give you his/her CMA to study. Thanks to computers, competent agents can often prepare their CMA within an hour, including photos of the comparable homes.
If an agent refuses to leave the CMA with you, that agent doesn’t trust you. To prevent an agent from misleading you into listing too high (called “buying the listing”) or too low (low balling), smart sellers compare the CMAs of the three or more agents interviewed.
2. HOW LONG HAVE YOU BEEN SELLING HOMES IN THIS AREA? ARE YOU A FULL-TIME AGENT? WHAT PROFESSIONAL COURSES AND DESIGNATIONS HAVE YOU COMPLETED? The best agents will anticipate these key questions either in their listing presentation or by handing you their professional brochure.
Don’t necessarily dismiss a motivated new agent if he or she works full-time and has adequate managerial supervision in a highly respected local brokerage. If a new agent has only a few listings, that could be better than listing with an “old pro” agent who has too many listings to adequately handle yours.
Incidentally, don’t be overly impressed by a well-known name on the broker’s door; you’re hiring an individual agent, not the firm.
3. WHAT IS YOUR MINIMUM LISTING TERM? This question is very important. The correct answer is 90 days.
If an agent attempts to get a 120- or 180-day listing, unless you have a unique or very expensive home with a limited market, your reply should be, “Don’t you think you can get my home sold in 90 days?”
Watch out for a favorite tactic of agents who want long listings. They say, “Well, the average days on the market for homes in this area is 110 days.” Don’t be fooled. Your reply should be, “Well, I don’t want just an average listing agent.”
However, you can safely make an exception if the agent insists on a 180-day listing but includes in the listing a written clause “Seller may cancel this listing after 90 days without reason or cost.” If the agent is doing a good job, but your home is unsold after 90 days, you probably won’t cancel.
4. WHAT SALES COMMISSION RATE DO YOU CHARGE? Most realty agents will tell you their “standard commission” rate is 6 percent or 7 percent. However, you should know, real estate commissions are negotiable.
According to a recent nationwide survey by Real Trends, the average real estate sales commission is now 5.1 percent of the home’s gross sales price.
The higher the market value of your home, the greater the probability the realty agent will discount their commission rate to get your listing. To illustrate, if you are selling a $1 million house, most listing agents will gladly accept a 5 percent commission rather than insisting on a 6 percent commission and not getting your listing.
However, if you are selling a $200,000 home, many agents are very reluctant to cut their commission from 6 percent to 5 percent. The reason is not the $2,000 difference.
The true reason is offering a 3 percent, rather than a 2.5 percent, commission split to a cooperating buyer’s agent is often very important for getting your home sold. If agents representing buyers can show your home with a 2.5 percent commission to the selling agent, or a similar home offering a 3 percent commission, which home is that agent likely to show first?
If you are willing to do some of the work selling your home, such as holding weekend open houses, you might consider local discount brokerages such as Assist2Sell and Help-U-Sell.
However, be sure your listing will be in the local MLS (multiple listing service) and the all-important www.Realtor.com where 70 percent of today’s home buyers begin their home searches.
5. WHAT IS YOUR MARKETING PLAN FOR MY HOME AND WHAT SERVICES WILL YOU PROVIDE? Each agent you interview should have a written marketing plan for your home. At a minimum, these services should include listing your home in the local MLS, on the agent’s individual as well as the brokerage Web site, and on www.realtor.com. Any realty agent who is not Internet savvy today is hurting their sales volume and their home sellers.
In addition, each agent’s marketing plan should include newspaper advertising, weekend open houses, local broker open houses for other agents, and ads in local homes magazines. More expensive homes might justify the broker using brochures and mailers to neighboring home owners who could know prospective buyers.
6. OTHER THAN YOURSELF, WHO IS THE BEST REAL ESTATE AGENT IN THIS AREA? Savvy agents will try to evade answering this question. Then ask what do you think of these other agents I am interviewing. Respect the agents who honestly answer this question. Of course, be sure to verify any negative information.
7. WHAT ARE THE NAMES, ADDRESSES AND PHONE NUMBERS OF YOUR FIVE MOST RECENT HOME SELLERS? Hopefully, each agent you interview will provide this ultra-important information without your asking.
Before signing a listing, take time to phone each agent’s recent home sellers to ask, “Were you in any way unhappy with your agent and would you list your home for sale again with the same agent?” Then, shut up and listen carefully, especially if there is hesitation or a vague answer.
8. WHAT SUGGESTIONS DO YOU HAVE TO BETTER PREPARE MY HOME FOR SALE TO EARN TOP DOLLAR? DO YOU RECOMMEND STAGING IT? Most agents will hesitate to criticize your home until they have your signed listing. But you need to know before signing the listing if the agent wants you to fix up your house or condo before putting it on the market for sale.
Be sure each agent tells you if he or she thinks your home should be “staged.” That means most or all of your furnishings are moved out and a “professional stager” moves in more attractive rented furnishings. Of course, staging costs money the home seller gets to pay. If you are a savvy negotiator, you might get the listing agent to pay for staging if your home will sell for a large commission.
Staging can help sell an otherwise drab house. For example, I recently visited a broker’s open house for an $18 million estate home listed for sale. The broker did a superb job of making a vacant “dated” house look good by having it professionally “staged” by an interior decorator.
9. HOW MANY LISTINGS DO YOU HAVE NOW? IF I LIST WITH YOU, WILL I BE DEALING WITH YOU OR AN ASSISTANT? HOW OFTEN WILL YOU CONTACT ME ABOUT SALES PROGRESS? If an agent has more than 15 to 20 listings, there is no way he or she can personally do a superb job for those home sellers without having one or more personal assistants.
There is nothing wrong with realty agents having assistants, just as dentists and physicians do. However, you need to know you won’t be “just another number” to the listing agent and how you can personally contact the agent if you have questions.
Just between us, many of these “numbers agents” know a certain percentage of their listings will sell, and a percentage won’t sell. If you don’t have confidence in the success record of the agent you interview, and his or her recent seller recommendations, keep looking.
10. SHOULD MY HOME BE SOLD “AS IS?” Sometimes it doesn’t pay to fix up a house or condo before listing it for sale. If the seller doesn’t want the hassles of fixing up and is willing to sell at a below-market price, “handyman special” home sales appeals to the bargain hunters. If your home is in less than tip-top condition, ask each agent you interview if an “as is” sale, with full written disclosure of all known defects, is recommended.
SUMMARY: Home sellers who want to take advantage of today’s excellent home sales market in most communities can’t ask too many questions before listing their residences for sale during the fall “second best” time of the year to sell a home.
(For more information on Bob Bruss publications, visit his
Real Estate Center).
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