Selling a home can be a challenging and overwhelming experience, with various steps involved, and potential pitfalls that could impact your peace of mind and finances. It’s essential to be aware of common mistakes to avoid when selling your house. In this article, we discuss four mistakes to avoid when selling your home.
- Underestimating the Cost of Selling
Many homeowners only think about the agent’s commission when selling their home, which is typically around four to six percent of the total cost. However, there are other costs to consider, such as repairs, closing costs, and other concessions, which can add up to around 25 percent of the total cost. Some homeowners choose to avoid these costs and sell their homes in as-is condition to cash home buyers, for example, https://falcon-homebuyers.com/
If you move into a new place before selling your old one, you may have to pay both mortgages or rent, on top of other costs such as storage fees, taxes, HOA dues, and utilities.
To avoid these costs, selling to an investor can be a wise choice as there are no hidden charges, and you know exactly what it will cost and how much you will profit from the sale.
- Making Costly Renovations or Ignoring Major Repairs
One common mistake that sellers make is focusing on renovations or improvements to up the price of their property. However, these can be costly, and you may not recover the cost within the purchase price. Additionally, buyers may want to personalize the home to meet their needs, so be careful with renovations to add value to the property.
It’s crucial to prioritize glaring issues, especially those that will probably turn up during home inspections. Most buyers require an inspection before closing the deal, and during home assessments, broken items, poor condition areas, and areas that might affect functionality, structure, and safety are often looked for.
- Considering Only the Highest Offer
Although the highest offer may seem like the best option, it’s not always the case. Traditional sales often come with contingencies that must be satisfied before the sale closes, such as inspections and financing options.
It’s essential to be aware of these contingencies because they could impact the sales complexity, certainty, and timeline. For example, a buyer may offer a high price, but it’s contingent on them first selling their current home.
In this scenario, the seller could wait months for the buyer to sell their property while continuing to maintain the property they’re selling. In contrast, a lower offer that doesn’t include that contingency could be a better option.
Another scenario is where one buyer may be more flexible on repairs and offer a lower price, while the other buyer may pay more but want the seller to take care of the repairs. It’s crucial to weigh the pros and cons of each scenario and choose the one that best suits your situation.
- Setting an Unrealistic Price
The market determines prices, so what you want from the property may not align with what the property is worth. Fair Market Value is how the house is valued when the seller and buyer are knowledgeable about the property and aren’t under pressure to buy/sell.
Setting an unrealistic price can result in the house sitting on the market for extended periods or getting less than what could have been received if the Fair Market Value number was hit. It’s challenging to make adjustments yourself, but investment companies use valuation models to compare various features within comparable homes. This means they can make a better offer based on market data and information from the sellers.
Selling a home can be a painless and smooth process with knowledge on what to avoid. Underestimating the cost of selling, making costly renovations or ignoring major repairs, considering only the highest offer, and setting an unrealistic price are common mistakes that sellers make when selling their homes.