Are you a home seller in agony because your home has festered on the Salt Lake City market week after week with few to no showings? Here are six culprits that may be keeping buyers away from purchasing your home.
#1 - Your home is overpriced
Optimistic home sellers love to parrot the old adage, "There's a buyer for every home." But they often leave off the qualifier: "at the buyer's price."
The fact is that buyers, not sellers, ultimately determine the market value of a home. You can ask for the moon and set your listing price well above comparable properties in your neighborhood, but at some point it will be up to you, the seller, to accept what the buyer thinks your home is worth. Overpricing is the most common reason homes don't sell. When you ask an unrealistic price, it sets in motion a process that often works against you. Here's why:
Most real estate agents, and their qualified buyers, will see your new listing within 30 days. If it is overpriced by as little as 5%, it will be duly noted and interest in your property will diminish, especially if you show no intention of coming off your asking price. You likely already priced out buyers who might have qualified for financing at a more reasonable price. Even if you manage to find an emotional buyer at your inflated asking price, the property may not appraise at that figure and the financing will fall apart.
Your real estate agent may have approved or even suggested the inflated asking price to secure your listing. Conversely, other agents often use overpriced properties like yours to help sell their own listings.
Is your Draper home priced at $369,000, but should be listed for $300,000? If so, you are trying to compete against homes that are really worth close to $400,000 and your home will NOT compete well. You want to compete with other homes similar to yours.
If your home remains on the market for too long, agents and buyers may begin to wonder if there are other, more serious, reasons why it isn't selling. It becomes shopworn, the same as a new shirt hanging in the store week after week. People are aware that it has been on the market a long time and agents stop showing it. Even if you finally reduce your price, the initial excitement for your Sandy home, Holladay estate, Salt Lake City Luxury home will have waned. Pricing your home right, in the beginning, is the most crucial step to selling your home.
#2 - Your home doesn't 'show' well
Your South Jordan home is competing against shiny new houses in those pristine subdivisions out in the Herriman suburbs with their attractive prices, incentives and community amenities.
Face it: Even the best old house needs a little makeover if it hopes to attract a qualified buyer.
The good news is most of the work will be cosmetic and relatively inexpensive: a new coat of paint, a new front door or a few attractive window boxes, a thorough cleaning of floors and carpets. Voila! The place may look good enough to reconsider.
A good real estate agent can advise you on where your time and money are best spent.
Price and condition are two things that the seller can do something about. Paint is probably a seller's best friend because it makes things smell fresh and look fresh. If it's time to paint, it's time to paint. It offers the best return on investment.
#3 - Location, Location, Location... and you're in a bad one.
Nothing has a greater effect on your home's value than its location. Your humble abode might be worth a king's ransom were it located on Walker Lane, Cottonwood Lane or the Harvard/Yale area in Sugarhouse. It might even jump thousands in value just two streets over in the next (and far superior) school district.
Location rules in real estate. Period.
If your home's location is less than desirable, your options are somewhat limited. A good real estate agent will do her best to help you accentuate the positive and eliminate the negative of your circumstances, say by using foliage to screen off offensive adjoining properties or dampen traffic noise but, the best way to compensate for a poor location is to reduce your asking price or offer attractive incentives such as seller financing or a lease option.
#4 - You have a not-so-great agent or a "non-existent" agent
Yes, they exist: Real estate agents who mislead, misfire and misbehave.
Their bad advice can cost you plenty in time and money, not to mention the sheer hassle of keeping the place show-ready 24/7.
The not-so-great agent will allow you to overprice your home ("Here's what I can get for you if you list with me!"), not market it properly, fail to screen for qualified buyers, not answer their phones promptly, be unresponsive to interest from other agents (if they sell their own listing, they don't have to split the commission) and keep you totally in the dark throughout the process by offering little to no feedback.
What's more, if your agent is abrasive, arrogant or otherwise difficult to work with, other agents may not want the hassle of showing any of their listings to prospective buyers.
The "non-existent" agent is someone you've paid a flat fee to simply place your home on the Wasatch Front Multiple Listing Service. This is ALL you're getting. No advertising, no marketing of any kind, no professional advice or guidance, no representation of any kind should you receive an offer. This situation could also be a big deterrant to most good realtors, as it typically means double the work for the selling agent to deal with "non-existent" listing agents. Paying a smaller flat listing fee may sound like a great idea at first, but when your over-priced home has sat on the MLS for months (in this buyers market) with little to no exposure, you've simply wasted time, energy and money. Let a good realtor work hard for you and, in the end, will help draw a better sales price because of their expertise.
#5 - You are battling competition or market conditions
We've all heard the terms "buyer's market" and "seller's market." In real estate, market conditions are affected by any number of external forces, some of them predictable (the weather, sort of), some of them unpredictable (the local economy, interest rates, public optimism or pessimism).
In a "hot" or seller's market, homes go fast. Inventory (homes on the market) may be low, meaning less competition for you. Chances are better that you will get your asking price in a hot market; in fact, it is not uncommon to even be offered more than your listing price.
But in a "flat," "cold," "slow" or buyer's market, sales slow to a trickle, inventories grow and buyers can find bargains, especially when they know the seller is motivated (i.e., paying on two mortgages). Or, when there are a plethora of short sales and foreclosures surrounding your area.
If you're trying to sell in a flat market, you're not only competing against all that vacant new construction, but distressed homes and against rentals as well. In this case, be prepared to settle for less than top dollar, or wait to sell until the pendulum swings once again in your favor.
#6 - You have ineffective marketing
Gone are the days when an agent could simply place your listing with the Wasatch Front multiple listing service, hold a halfhearted open house and wait for another agent to bring forth a buyer. Today's top performers launch a multi-level marketing plan that includes open houses, listing fliers, home tours, local real estate publications and top internet marketing.
Computers and the Internet have changed the face of real estate. According to the National Association of Realtors, today more than one-third of all home buyers use the Internet for house hunting. The best Utah real estate agents are computer-savvy. They have your listing in full color tours available on innumerable top-ranking websites and communicate frequently via e-mail, a particular boon when working with out-of-town buyers.
Suffice it to say that if your real estate agent isn't listing your home online through the company Web site as well as with the local MLS and multiple other top ranked websites, you may not be getting the exposure necessary to find a buyer.
There are those who just put the listing on the MLS and pray it will sell and those that put a lot of effort into marketing their listings. Unfortunately, with this weird system of compensation we have, they all get paid the same, whether they know nothing or have many years of experience. Again, it doesn't cost any more to use the best!