Real estate can be a funny business. Almost every buyer I speak to will express early in the conversation that “they want a good deal” and will usually follow up with “I don’t want to pay too much.”
Sellers almost always will tell us that they’ve seen the news reports, know what their home is worth and want to get top dollar for their house.
So how do Realtors get buyers “good deals” and yet get sellers “top dollar?”
For buyers, it’s all relative. The conversation has to start with what is happening today. Buyers cannot be fixated on what occurred between 2008 and 2011 because those times are in the distant past, and the market is radically different today.
When sellers are receiving five to 20 offers within days of going on the market, they need to choose what is best for them. Often, that may not be the most money offered, rather the most offered with the best chance of succeeding. They must factor in the buyers’ qualifications, down payment, type of loan and the ability to raise extra cash in the event that the appraisal comes in too low. Good Realtors will also assess the buyer’s agent to see if they are competent enough to complete a complex transaction.
Buyers should understand that the market will not continue at this torrid pace, and should expect appreciation to return to a modest 3 to 4 percent per year. A “good deal” may just be winning the bidding war and becoming a homeowner, without expectation of appreciation in the short term. Buyers should also understand that they might make offers on seven, eight or 10 houses before being selected as the winning bidder. Perseverance will go a long way in a successful home search.
Lastly, buyers today will need to understand that in multiple offer situations, sellers are in control. They may require buyers to remove certain contingencies up front. They will need to decide if the risks of removing certain contingencies are worth the risk, and how badly they want the home.
Sellers need to be realistic about their expectations. The homes that are getting 20 offers and selling for really high numbers are really nice homes in nice neighborhoods. The not-so-nice homes are getting multiple offers as well, but they aren’t getting what you and I might consider to be “top dollar.”
What is the difference? It’s condition and presentation.
If you want top dollar, and have multiple buyers bidding against each other to have your home, you need to prepare the home correctly.
Start with de-cluttering. Remove all clutter, personal photos, stuff on counters, toys on the floor, broken garden tools in the yard, car on blocks, piles of clothes in corners, etc. Think “model home” in everything you do. Furniture should be edited, some removed and the rest rearranged to best create an open and inviting space.
Next is cleaning. Floors should be cleaned, carpets shampooed, counters clear and clean, sinks empty, bathrooms very, very clean, windows and screens cleaned, light fixtures cleaned, walks, patios and driveway power-washed. All appliances should be spotless. Many home sales have been killed because the place simply wasn’t clean.
I recently sold a 2,700 square-foot home that was so cluttered we had to write the contracts on the hood of my car. Another home smelled so bad that we wrote the contracts on the picnic table. Both sold for significantly less than what they could have gotten, had the homes been clean and nice.
De-cluttering and cleaning won’t cost any money. It just requires some time and effort on your part to maximize your sale.
The third element is repairs. If you want “top dollar,” the home should be move-in ready. You may need to repaint a few rooms, repaint the exterior trim or even the whole house. Clean and touch up kitchen cabinets and vanities. Definitely spend $5 and re-caulk around the bathtub, sinks and kitchen counters. Nothing turns buyers off like black, moldy caulk. Replace burnt out light bulbs, missing address numbers, broken windows, broken tile and all the minor little turn-offs that buyers will see. Spend $50 at the garden center and plant colorful flowers in the front yard. Hire a gardener if you have to, and make the front of the home inviting to visitors. Presuming nothing major needs replacing, this entire list will cost less than $1,000, and the difference it will make on the market will be huge.
It’s up to you. Roll up your sleeves and spend a few bucks and you will get “top dollar.” Otherwise, expecting all the money for a less than stellar home is probably unrealistic.
Your Realtor should be able to advise you on everything that needs attention, help you stage the home and introduce you to vendors who can assist you.
