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Why Use a Realtor When Selling Your Home
Selling a house can be a complex process. A Realtor can help you at every stage, from setting a price to marketing the property to closing the sale.
Setting the Price
The selling process generally begins with a determination of a reasonable asking price. Your real estate agent or Realtor can give you up-to-date information on what is happening in your local marketplace, as well as the price, financing, terms and condition of competing properties. These are key factors in marketing your home and selling it at the best price. Often, your agent can recommend repairs or cosmetic work that will significantly enhance the salability of the property.
The next step is a marketing plan. Marketing exposes your property to the public as well as to other real estate agents through a Multiple Listing Service, other cooperative marketing networks, open houses for agents, and so on. In many markets, a substantial portion of real estate sales are cooperative sales; that is, a real estate agent other than yours brings in the buyer. The Realtor Code of Ethics requires Realtors to use these cooperative relationships when they benefit clients.
An agent will also know when, where and how to advertise — which medium, format and frequency will work best for your home and your market. Though advertising can be valuable, the notion that advertising sells real estate is a misconception. National Association of Realtors studies show that 82 percent of real estate sales are the result of agent contacts from previous clients, referrals, friends, family and personal contacts.
When a property is marketed with an agent’s help, you do not have to allow strangers into your home. Agents will generally prescreen and accompany qualified prospects through your property.
Your agent can help you objectively evaluate every buyer’s proposal without compromising your marketing position. This initial agreement is only the beginning of a process of appraisals, inspections and financing — a lot of possible pitfalls. Your agent can help you write a legally binding, win-win agreement that will be more likely to make it through the process.
Monitoring, Renegotiating and Closing
Between the initial sales agreement and the closing (or settlement), questions may arise. For example, there are unexpected repairs that require the buyer to obtain financing, or a cloud in the title is discovered. The required paperwork alone is overwhelming for most sellers. Your agent is the best person to objectively help you resolve these issues and move the transaction to closing.
Getting the Realtor Guarantee
All real estate licensees are not the same. Only real estate agents who are members of the National Association of Realtors are called Realtors. They proudly display the Realtor logo on their business card, website, and marketing. Realtors subscribe to a strict code of ethics and are expected to maintain a higher level of knowledge of the process of buying and selling real estate. Realtors are committed to treating all parties to a transaction honestly. An independent survey reports that almost 85 percent of home buyers would use the same Realtor again.
Getting Expert Assistance
Finally, consider the scale of your transaction. Selling your home is one of the biggest financial decisions you’ll make. Transactions today usually exceed $100,000. If you had a $100,000 income tax problem, would you attempt to solve it without the help of a CPA? If you had a $100,000 legal question, would you deal with it without the help of an attorney? Considering the relatively small cost of hiring a Realtor and the large potential risk of not hiring one, it’s smart to find a professional to sell your home.
Ron Schmeadick wrote this article.
Selling your home? Call your REALTOR®
- Your REALTOR® can guide you through the closing process and make sure everything flows together smoothly.
- When selling your home, your REALTOR® can give you up-to-date information on what is happening in the marketplace and the price, financing, terms and condition of competing properties. These are key factors in getting your property sold at the best price, quickly and with minimum hassle.
- Your REALTOR® markets your property to other real estate agents and the public. Often, your REALTOR® can recommend repairs or cosmetic work that will significantly enhance the salability of your property. Your REALTOR® markets your property to other real estate agents and the public. In many markets across the country, over 50% of real estate sales are cooperative sales; that is, a real estate agent other than yours brings in the buyer. Your REALTOR® acts as the marketing coordinator, disbursing information about your property to other real estate agents through a Multiple Listing Service or other cooperative marketing networks, open houses for agents, etc. The REALTOR® Code of Ethics requires REALTORS® to utilize these cooperative relationships when they benefit their clients.
- Your REALTOR® will know when, where and how to advertise your property. There is a misconception that advertising sells real estate. The National Association of REALTORS® studies show that 82% of real estate sales are the result of agent contacts through previous clients, referrals, friends, family and personal contacts. When a property is marketed with the help of your REALTOR®, you do not have to allow strangers into your home. Your REALTOR® will generally prescreen and accompany qualified prospects through your property.
- Your REALTOR® can help you objectively evaluate every buyer’s proposal without compromising your marketing position. This initial agreement is only the beginning of a process of appraisals, inspections and financing — a lot of possible pitfalls. Your REALTOR® can help you write a legally binding, win-win agreement that will be more likely to make it through the process.
- Your REALTOR® can help close the sale of your home. Between the initial sales agreement and closing (or settlement), questions may arise. For example, unexpected repairs are required to obtain financing or a cloud in the title is discovered. The required paperwork alone is overwhelming for most sellers. Your REALTOR® is the best person to objectively help you resolve these issues and move the transaction to closing (or settlement).
Your Home’s First Price Should Be Its Best Price
If you’re putting your home on the market, especially if you live in an area where prices are going up and buyers are competing for homes, you may be tempted to try listing it at a high price just to see if you can get it.
Don’t do it.
Experienced Realtors will tell you that pricing your home appropriately from the beginning is critical to getting it sold quickly and at the best price. Research shows that overpricing your home and then dropping the price several times while it languishes on the market usually leads to selling it at a much lower price than what you originally should have asked for it. The longer a home stays on the market, the deeper the discount is likely to be off the original price.
For example, according to McEnearney Associates, a McLean, VA, real estate company, homes that sold in August 2013 within their first week on the market sold for an average of 2.08 percent above list price. Homes that lingered on the market for four months sold for an average of 11.53 percent below their original price.
How to price your home correctly
Many homeowners want to set their list price based on what they paid for their home, the balance of their mortgage, or on the profit they want to make so they can move into another home. In reality, your home is worth only what the market will bear. If you price your home too high, some potential buyers won’t want to look at it at all, while others will simply walk away without making an offer.
If you’re interviewing several Realtors to choose a listing agent, you may be tempted to pick the sales professional who suggests the highest price for your property. But sellers, like buyers, need to beware. The Realtor who provides the best comparative market analysis and explanation of how your home should be priced will be more likely to sell your home quicker and for a higher price than someone who tells you only what you want to hear.
A comparative market analysis should include sales prices for similar nearby homes that sold in the last month or two. In addition, many Realtors include prices for homes currently on the market that will be your competition, as well as homes taken off the market because they didn’t sell. Other data Realtors can use to suggest a price range include how many days homes were on the market at various price points and the average difference between the list prices and sale prices on homes that have sold.
Your Realtor can help you estimate who might want to buy your house and what else those buyers are looking at so you can measure your price against the competition.
A knowledgeable Realtor can factor in all of these issues in the context of your local market conditions, including whether home prices are rising or falling and whether it’s a buyer’s or seller’s market.
Choose the right professional to help you with your home sale and then listen to your Realtor’s advice and your transaction is more likely to go through quickly and smoothly from the beginning.
Market Your House for Maximum Exposure
Once you’ve made the commitment to sell your home, chosen a REALTOR® to represent you, and established a list price, it’s time to work with your REALTOR® to market your property so it sells as quickly as possible.
Your REALTOR® should share a marketing plan with you, but the more you know about the process of selling your home the easier it is to support your REALTOR®’s efforts.
The day your home goes on the market it should be in prime condition and priced right to attract the most potential buyers. While your REALTOR® can help you determine an appropriate price and can offer suggestions to make your home more appealing, your job is to put in the work to get your home pristine clean and to remove clutter and personalization.
Buyers want to see a home where they can visualize themselves living. If buyers see an overstuffed closet, they’ll assume the home lacks storage space; and if your kitchen counters are cluttered, they’ll think the space is too small.
Provide your REALTOR® with tips about what you love best about your home and community that can be incorporated into your marketing materials.
Your REALTOR® can advise you on what you need to repair before putting your home on the market. You can also visit other homes that are for sale, or even local model homes for ideas on ways to present your home to potential buyers.
What to Expect From Your REALTOR®
Many REALTOR®s have experience staging homes, or they can bring in a stager to rearrange your place. In addition, your REALTOR® should market your home in multiple ways:
- Research the market to identify potential buyers to target for direct mail.
- Reach out to other real estate brokers and agents who work with buyers in your price range.
- Take excellent photos or hire a professional photographer to showcase your home online with attractive pictures.
- List your home on the local Multiple Listing Service and make sure it receives maximum exposure on multiple websites.
- Take a video of your home or produce a virtual tour with numerous photos so your home can be viewed in-depth by buyers looking online.
Once buyers begin visiting your home or contacting your REALTOR®, your agent should respond as quickly as possible to keep the momentum going. Every visitor to your home or their agent should be contacted by your REALTOR® to get feedback on your home and to gauge their interest.
What Your REALTOR® Should Expect From You
While your REALTOR® does the heavy lifting when it comes to marketing, as a seller you need to support your REALTOR® in several ways:
- Keep your home as clean, neat and odor-free as possible while your home is on the market. This may mean that you have to give up cooking your favorite liver-and-onions dish and that you have to bribe your kids to make their beds and take out the trash every day.
- Make your home as available as possible to buyers, no matter how inconvenient it is for you and your family. Your home won’t sell if no one can see it.
- Leave the house when buyers are there, since studies have shown that buyers linger and look more carefully when the homeowners aren’t present.
- Lock up your pets or take them away when buyers are visiting, especially during anopen house when multiple visitors are expected.
- Provide information to buyers about community amenities or neighborhood sports leagues so they can appreciate your home’s location.
If you and your REALTOR® develop a team approach to selling, you’ll benefit from a quicker and more pleasant real estate transaction.