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Common Mistakes Homeowners Make When Selling Their Home

By Wallace Hobbs

Education & Training

March 05, 2009 05:30 AM

Ok we all know that most people believe they know everything there is to know about selling their house. They sign a contract with an agent, hold an open house, and wait for those multiple offers. But some common misconceptions about the whole process could be hurting their odds of receiving an offer. Improve your own odds with a bit of knowledge.

Myth: People are buying your house, not your furniture. You might be selling only four walls and a roof, but most people looking at your house see beyond the basic structure. They are buying a lifestyle. Potential buyers will be looking at the square footage and the solidness of the structure, but they will also notice the battered sofa, the wrinkled bed sheets, and the imposing dining room set. A house might be in pristine condition, but if the furniture is threadbare and tired it will make the entire house seem run-down. Improve your furniture, and improve your chances of selling your house.

Myth: The selling price of your house increases with every upgrade. While some upgrades can increase the selling price of your home, improving your home too much can price you out of the market. To set your renovation budget, research homes in your neighborhood

to find out their final sale prices. Your original purchase price and renovation budget together cannot exceed the sale prices of other homes. If you decide to overspend to create a customized dream home, you may never see a return on that investment. But adding square footage to your home, through an addition or a finished basement, may pay off. Book an appointment with your real estate agent before starting any major construction to ensure that you are not overspending.

Myth: An open house is the best way to sell a home. Only 5 percent of homes sell through an open house. The Internet, particularly the Multiple Listing Service, has become the fastest and most convenient way to view homes. Potential buyers see all the properties for sale in their area and compare the features of each, all without leaving their own home. Buyers can view hundreds of properties in a day using MLS, but only a handful of homes through open houses. Instead of holding an open house each weekend, try extensive advertising on the Internet and in local newspapers. And if a potential buyer wants a private viewing at an inconvenient hour, allow it. People at your open house might be curious, but someone who has requested a private viewing is interested in buying your home.

Myth: Base your price on potential profit.
The price of your home needs to be based on fair market value, otherwise you will never see an offer. You might need the profits from the sale to finance the purchase of a new home, or to pay off debt. Still, you can never raise your asking price to satisfy your own needs. Buyers will comparison shop. They will compare your house to other homes in your neighborhood, and if every feature but the price is equal, you will lose a sale. Remember that an asking price is not static. Considering market conditions, you may have to reduce your price to see that offer.

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