(CHEROKEE LAKE REALTY WRITES A WEEKLY COLUMN FOR THE GRAINGER COUNTY JOURNAL NEWSPAPER. THIS WAS A RECENT QUESTION ASKED BY A READER.)
When a home has been on the market for a few months and it has not sold, folks think there is something wrong with your home. So, they quit looking at it and views drop. Is that fair? No. But it is what it is. I’ve had experienced real estate agents call and ask what’s wrong with the home and why hasn’t it sold. The answer could be as simple as the clients have had multiple low offers and they have chosen not to take them. There is nothing wrong with the home, they are simply set on what price they want. But, as they say, sometimes perception becomes reality.
Besides a seller rejecting a low offer, there could be actual reasons why a home is not selling. Marketing, location, condition, economy, current status of the real estate market, and pricing. These need to be analyzed by you and your real estate agent. Some you can control, some you can’t. So, I will begin answering your question this week and continue in next week’s column. I will start with Marketing.
Has enough been done by the agent representing you to market the house? Has there been enough advertising done? If folks don’t know your home is for sale, nationally, then the magic won’t happen. Your real estate agent should make sure your home is being advertised adequately. Also, a good complete description of your home in all ads is important. You don’t know what will appeal to a buyer, so you want to tell us much about your property as possible. What’s appealing to one buyer may not be as attractive to the next. So cast a wide net, have your agent write as much about the property as they can. Perhaps one of the features in the ad will strike a chord with a buyer. Oftentimes all I see in an ad is… 3 bedrooms, two baths, nice view, half an acre, and a sentence or two. Come on now. Is that going to make them feel warm and fuzzy and motivate them to go see your home? Your real estate agent should pay for all advertising. And I realize a full-page ad in a magazine will cost them more than an ad the size of a thumb with one small photo. But it’s the cost of doing business. If that is what it takes to sell your property, then it needs to be done.
Is your agent always present to feature/benefit your home? In doing this the agent is showing and demonstrating to a potential buyer all the positive aspects of your property. Why this is the home they need to purchase. A home can’t talk and tell you how great it is. The buyers and their agent know nothing about your home. Lockboxes containing a key to your residence have become common. The potential buyers and their agent show up, gain access through the lockbox, and look around, without your agent being present. This is the way it is typically done now. All they will see is four walls and the lot, not the special features that need to be explained which will make a lasting impression on the buyers as they go on to the next viewing. Nowadays agents are sometimes showing as many as twenty properties to their client. You want yours to stand out. You want them to remember yours. Your agent can do that with the proper presentation. But if they are not present, that is not possible.
Photographs. We all have fancy cell phones with fancy cameras. I have a set of pliers at my home and if I have a bad tooth, I can pull it out myself. But am I as good as my experienced dentist doing the job that he has been trained to do? No. Leave the photographs to the professionals. Your agent should also pay for professional photos from whatever commission they are receiving. The photographs should show the interior and exterior of the home. Good aerial photos are also important, showing the neighborhood, location, etc. You don’t need to display 50 photos. 24 to 36 are ideal. You don’t need to show toilets, a closeup of a bed or furniture. We all have toilets and you are not selling the furniture. Focus on the photos that highlight your home. Leave a bit of mystery. Make the person seeing your ad want to see more and therefore schedule an appointment. Now, do your part to prepare for the photographs. Don’t have clutter laying around the home. Please make the bed properly, so wrinkles do not show. Don’t have a bunch of items on your bathroom and kitchen sinks. No towels hanging from the shower. You must have the home look it’s best. Show the viewing public that your home is a show home. A messy home will turn buyers off. If at the time when your home should look its best, it doesn’t, folks will think you did not take care of your home and may take it off their wish list.
We have all heard the real estate saying, location, location, location. Let’s face it, if your home is next to a landfill, most buyers won’t find it as attractive as if it’s close to the lake. If your home is in rough condition, even professional photos won’t hide this fact. What about the current state of the economy and the real estate market? When the public is concerned about the economy and its effect on interest rates, jobs, cost of living, and everything it impacts, folks freeze. We wait, hoping that the economic environment will improve. And, of course, this trickles down to buying a home. I’ve had sellers tell me how the home across the street, a much smaller home, sold for a high sales price a couple of years ago. And in less than one month. Their home is much larger, so their logic is that theirs should sell for much more and be gone in one week. Not necessarily. Maybe the economy was booming then. Interest rates were lower, price of goods, just the overall confidence this provides buyers with moving forward on such a big commitment, buying a new home.
So, what to do? How does one offset a poor location, condition of home, and a slower economy and/or real estate market if any of this applies to you? You can’t pick up your home and move it to a new location. Do you spend a hundred thousand dollars to fix it up and hope you can get that back when you sell it? Wait for things to get better? Will this happen a month from now, a year from now? If I knew the answer, I’d play the lottery.
So, analyze how your home is priced. Be realistic about your home. Understand that what was fine with your home, for you and your family, may not be as attractive to a potential buyer. Price the home low enough to compensate for its condition and what may not be perceived as a good location by buyers. Just because your neighbor’s home sold for a great price last year, and you believe your home is superior, doesn’t mean it will bring you more in today’s market. Put a bit of ego aside and price it to reflect the current real estate market. When your home first hits the market, every real estate agent in the area will look at it. Potential buyers that are scanning Zillow will look at it. If the price is not appealing enough to offset the negatives that your home may have, then they will go look at another home. And please be realistic. There is no perfect home. It doesn’t exist. All homes, including mine, have plenty of negatives. And, if your home doesn’t sell right away, and it lingers, and you start dropping the sales price, it starts to give buyers the idea that there is something wrong with your home. It hasn’t sold, and you dropping price adds to this perception. So, here is the moral of the story. Pricing is critical. From the get-go. Nobody wants to underprice the home and leave money on the table. Not you and not the real estate agent that works on a commission percentage of what your home sells for. A bit of packing the price to deal with offers is ok. But do not overprice it. If the price is higher than what the market will currently support, you may never get to the negotiating phase. I’ve heard clients say we don’t really need to sell. Well, if that’s the case and you want more than what the current real estate market will support, then don’t list your home for sale now. Wait until the market turns. It will, it always does. Although, we don’t have a crystal ball and can identify when that will happen. One thing to keep in mind that might ease the pain of selling your home for less than you expected. A lot of sellers did not list their home for sale when the market was booming because then they had to go buy a replacement home and did not want to pay the high prices that the new home would cost them. Well, when the market has slowed, keep in mind that when you sell, you might find yourself a replacement home at a better price than you might have a year ago. So, instead of thinking about location, location, location. Think pricing, pricing, pricing. With the ability that buyers have of viewing homes online, price your home attractively. A Toyota and a Lexus are basically the same car, but more Toyota vehicles get sold than a Lexus. Why? Lower price. You didn’t mention your location, condition, or pricing strategy in your question. Hopefully, my answers will allow you to analyze your situation and revisit all with your real estate agent.
