Buying or selling a home is one of the largest financial transactions that a person will conduct in their life. A daunting experience to many, some home sellers make unnecessary and easily avoidable rookie mistakes when selling a home for the first time.
Selling a property has the possibility of yielding large financial returns if the vendor is sales-savvy, but small mistakes in the run-up to putting your house on the market and during the marketing and selling process could eat into these profits and leave sellers unsatisfied and unhappy once the home is sold.
If you are selling your home for the first time, take care to not make these five common mistakes.
1. Trying to sell too quickly
Selling a house can take quite some time, and home sellers should not be anxious to sell too quickly, especially considering the slight housing downturn that certain cities in Australia are currently experiencing. The property market isn’t stagnant – rather, it is always in flux, and despite their best predictions, even the experts find it difficult to gauge how the property market will perform in the near future. It makes sense that the state of the property market at the time of selling will influence both the days a property spends on market, as well as the price that it fetches when it is ultimately sold.
Aside from what the property market looks like and of whether you are operating within a buyer’s or a seller’s market at any given time, an array of other factors may also influence how long it takes for a particular property to sell. The type of property you are looking to sell and the condition of the property at the time of going on market will certainly have a role to play in the time it spends on market, as will the number of comparable properties that it is competing with at a particular time.
How sought-after the suburb is that the property is located in will most definitely influence the timeline between putting a property on the market and the eventual sale thereof, and its proximity to social amenities, schools, the central business district, entertainment venues, universities and the coast are additional factors that sellers should consider when they start worrying that their property is not selling fast enough – and we haven’t even figured in the influence that the weather may have on property sales!
A good real estate agent will be able to lay out statistics that should set sellers’ hearts at ease. Real estate agents are familiar with the housing market in the area that they do business in, and will be able to say what the average days on market in a particular suburb or city are. When choosing a real estate agent, make sure to check their know-how of the market that they are operating in by finding out how many properties they have sold in the past two years or so, and asking how they’ve seen market conditions change in the last year. This should give you an immediate idea of whether they understand the intricate workings of the local property market.
To conclude: home sellers should not worry too much if their property takes a little longer to sell than they expected, especially during a time when the housing market is undergoing significant changes. Even so, a house that is on market for too long (that is to say, much longer than the average days that a comparable property spends on market in a specific suburb or city) home sellers should take the issue up with their real estate agent, and discuss the option of employing a new marketing strategy to advertise the property.
2. Not marketing widely enough
Marketing your property as widely as possible is the best way to reach the largest possible pool of potential buyers. While the database of buyers that your real estate agent has access to is a great start to get the ball rolling in terms of the marketing of your property, it won’t be enough to create a buzz around your specific listing, especially if many similar properties are up for sale at the same time as yours.
Take note that marketing and advertising often comes at an extra cost, separate from the agent’s commission – confirm the marketing and advertising fee with the candidates you are considering to use when initially interviewing real estate agents. Many home sellers are not aware that they will still be held liable for the marketing and advertising costs associated with the property (even if the property does not sell) if it is specified that way in the sales authority. However, sellers can request that a “no sale, no fee” clause is written into the sales authority, to avoid having to pay what could be a significant amount to market a property that does not sell, or that sells for an amount that is much smaller than what you were hoping to get.
Discuss a multi-pronged marketing strategy with your real estate agent when you speak to them about the marketing of your property, and have them draw up a written schedule that outlines advertising and other expenses. These fees are negotiable, and sellers are encouraged to take the opportunity to discuss the fees at length with their real estate agent.
As the name states, a multi-pronged marketing approach entails employing marketing strategies across a range of different channels and media, in the hope of reaching as many potential buyers as possible. In the modern era, traditional media like newspapers are still is still useful ways of marketing real estate, albeit to a much smaller extent than in the past. Remember this when marketing your property to potential buyers.
Your marketing strategy should also very much be engineered around the target market that you are looking to sell to, or that is most likely to be interested in the property. If your property is located in an up-and-coming neighbourhood close to the central business district of the city that you live in, one can make the assumption that young professionals would be a good target market to focus on. If the property is close to schools and amenities, it might appeal to young families. Quieter suburbs may draw the attention of older buyers or people that are looking to retire, while trendy suburbs with good access to entertainment could potentially appeal to a great many different types of buyers. Ask your real estate agent to give you advise on which target group you should try to centre your marketing strategy on, and tailor the way in which you market to very specifically target that demographic.
Traditional media’s days aren’t over as far as marketing real estate goes, but if you decide to market your property to millennials, you should definitely also ensure that your online marketing campaign blows them away. Young people spend a large part of their lives online, and social media marketing is a good way to attract the attention of a young demographic, but it certainly isn’t the only way.
It goes without saying that you should definitely list the property on online real estate portals and in this regard, you should make sure that the photos of your property are taken professionally, and that they focus on the highlights of your property.
Don’t underestimate the value that good photos can add to your marketing strategy, as this is ultimately the first glimpse that people get of the home you are selling. If you don’t hook potential buyers with clear and beautiful photos immediately, they probably won’t be interested to go to a viewing of the property to see for themselves.
The copy that you use in your online listing is also extremely important, and should highlight the strong suits of your property. Again, you should definitely keep your target demographic in mind when devising the wording used in your online ad. Your real estate agent will be able to assist here, and will know the buzzwords that appeal to specific buyers.
The real estate industry is increasingly incorporating innovative new ways of marketing properties into their advertising strategies. One example of using newly developed technologies in the marketing of real estate is the introduction of 3D tours and virtual staging of properties. This hasn’t yet become mainstream enough to not still be rather pricy, but if you are hunting for a high selling price, you’d do well to discuss this with your real estate agent as an alternative way of marketing your property. Especially if you are targeting millennial or international buyers, who prefer browsing for real estate online without having the ability to do so due to the distance, or who rather browse online as opposed to going to viewings of the property, 3D tours can prove a very effective way of marketing your home. Virtual staging further provides potential buyers with the opportunity to see what the property could potentially look like, or see different colour or décor options, giving them a sense of what it would be like to actually live in the property.
Another strategy that is gaining traction globally is what seems to be the counter-intuitive approach of using experiential marketing as a tactic to create buzz in the online sphere. Experiential marketing entails organising an event that centres on whatever it is that you are marketing. When marketing real estate, agents may, for instance, decide to organise a historical tour or a tour of the highlights of the suburb in addition to the traditional open house experience. Experiential marketing doesn’t only give potential buyers the usual viewing of the property that is being advertised, but also accentuates those aspects of the suburb that make it a worthwhile place to stay. Experiential marketing could also inadvertently create secondary marketing opportunities if people who come to view the property share their experience online. In a recent study, the Event Marketing Institute found that 98% of consumers capture content capture videos and photos when attending live events, and that 100% of consumers that do, tend to share it on social media. The result is that experiential marketing is very likely to yield free advertising opportunities through online “word-of-mouth” marketing.
Speaking of word-of-mouth marketing: don’t disregard the value that telling people that you’re selling your house could have. Getting the word of an imminent sale out to friends and acquaintances could unexpectedly bear interested buyers without you having to spend a cent. Of course, the grapevine won’t be an effective marketing strategy if it is used in isolation, nor would any of the other marketing strategies mentioned. Ideally, your real estate agent will suggest a combination of various marketing methods – both traditional (“For Sale” signs aren’t dead!) and new – to ensure that the greatest possible audience is reached.
3. Asking for a price that is simply too high
It should not surprise anyone to find out that a price that is too high will prolong the time a property spends on the market, and may even see it not selling at all. The fact of the matter is that property listings need to meet the market price at a specific time, as a home is always only worth as much as buyers are willing to pay for it.
Home sellers are often subjective about the price they’d like their property to fetch, factoring in a fair amount of sentimental value, together with the actual dollar-value of their property. This is unwise and unrealistic, and will not yield good returns. Prices that are higher than they should be discourage would-be buyers and – contrary to popular belief – leaving room for buyers to negotiate only goes so far.
Your real estate agent will be able to help you determine an asking price that is fair and allows you to make a profit, but is not too high to discourage potential buyers. If buyers get the sense that acquiring a property is going to take too much effort on their behalf (keeping in mind that buying property already comes with metres of red tape anyway) they’d rather steer clear from having to try and convince a seller to bring the price of a property down, and this is especially true if there are numerous other comparable properties on the market at the same time.
An experienced and qualified real estate agent will be able to take the many factors that influence the price of a property into account, and make a recommendation about the asking price accordingly. As objective bystanders who would also earn the best possible commission on a sale, real estate agents will be realistic and fair in their estimate.
4. Spending too much on renovations
There is a lot to be said for renovating your home to fetch a higher price when it comes time to sell it, but first-time home sellers often spend far too much money on renovations and improvements that do not add value to the property.
Unless you decide to sell your home as is, there are certain repairs, renovations and improvements that may have a significant return on investment, though. These improvements won’t leave your bank account empty, but will give you a bit of leverage when you are engaging with prospective buyers.
Real estate agents always mention the value that an updated kitchen could add to your home’s value, and despite it sounding like an old wives’ tale, agents will mention how they’ve seen the expected selling price rise after a minor kitchen remodel. Minor renovations to your kitchen are much cheaper than completely redoing this area of the home, but the impression that a beautiful kitchen makes will make up for this expense once your home is sold.
The same can be said for minor bathroom remodels. Together with the kitchen, the bathroom is an area in the home that buyers scrutinise, because they know that repairs to this space could be expensive. However, simple touch-ups like removing and replacing the caulk around the bathtub, toilet, sink and shower and re-grouting the tiles are inexpensive ways to dispel any doubts that buyers may have about the state of the bathroom.
As more and more people become environmentally aware, energy-efficient upgrades are good ways to do your part for Mother Earth, while also impressing potential buyers. Replace incandescent light bulbs in the home with their more energy-efficient fluorescent and LED counterparts. Install solar-powered outdoor, patio and security lights around your property. Replace your old showerhead with a low flow equivalent: it uses up to 75% less water, but doesn’t compromise on a consistent flow rate or high-pressure stream. Take a good look at your windows and doors, and replace the caulking around them to ensure that they seal more efficiently. When you real estate agent brings potential buyers to view your property, make sure that they mention the energy-efficient improvements that have been done. Improvements like these will impress buyers, can save them lots of money in the long run, and it’s sure to make your house stand out among other similar properties when they consider which home to buy.
Other cost-efficient improvements that won’t break the bank are simple improvements that enhance kerb appeal, like a fresh coat of exterior paint and landscaping enhancements. These relatively cheap quick fixes create a lasting first impression, but make sure to also repaint the interior of your home where it is necessary.
Your real estate agent will be able to give good advice about what improvements and renovations are imperative before putting your house on the market, and which ones won’t make any difference to the recommended asking price.
5. Not giving your real estate agent enough power
A real estate agent that is qualified and has experience of doing business in a specific city or suburb is an asset to any first-time home seller. Your real estate agent is the expert you need on your side when traversing what might seem to be a mountain akin to Everest, and once you’ve found an agent that you “click” with, you’ll need to be willing to give some of the power over to them. Of course, you will ultimately make all the decisions, but many people who are selling a home for the first time are wary of letting their real estate agent handle negotiations and viewings on their behalf, fearing that the agent might not be able to get a selling price that is as high as they want, or that the agent might fail to mention the property’s perks and highlights when taking potential buyers to see it. This fear is ludicrous, and considering the fact that you are paying someone to take advantage of their knowledge, letting go and allowing them to handle the task they have been assigned with means that you won’t be wasting your money on commission.
Rest assured: the objectivity and expertise that a good real estate agent brings to the table, combined with a drive to get the highest possible price in order to ensure a decent commission for themselves should be enough reason to trust them with this important financial transaction.
When doing something for the first time, small blunders are inevitable, but first-home sellers that err in this way can be their own worst enemy, and can pay for these mistakes with money that could just as well have been added to the profits earned when selling a property.
First-time home sellers must always remember that it takes time to sell a property, but that this time can be cut to a very large extent if the property is properly marketed to a wide enough audience, specifically focusing on the target market that is identified, in collaboration with a good real estate agent.
A real estate agent that is qualified and experienced will be able to suggest an asking price that is fair to both the buyer and the seller, and can also suggest repairs and improvements that add value to the property. However, home sellers must be willing to hand over some of the negotiating power to their agent to ensure that they get what their paying for in terms of the commission that an agent charges for their services.
For suggestions of good, reputable, qualified and experienced real estate agents that fit your specific criteria, contact Perfect Agent. Our database is filled with agents that can’t wait to help you sell your home for the first time, at a first-rate price.