The 7 Most Deadly Mistakes People Make When Selling a Home

Each year, many home sellers make the same mistakes over and over again. When you add up these mistakes, they total more than a million dollars each year!

Deadly Mistake #1 “Hard Selling” During Showings

People buy homes on emotion, not logic. Buying a home is always an emotional decision. People like to get a feel for a house to see if it is comfortable for them. It’s difficult for them to get comfortable in a home if you follow them around, telling them all of the things that you’ve done to the house and pointing out every improvement that you’ve made. It may even have the opposite effect that you want to accomplish by making the prospective buyer feel that they are intruding into your private space.

Resist the temptation to talk to the buyer the entire time that they are in your home. Let them discover the home on their own.

Deadly Mistake #2 Mistaking “Lookers” for Buyers

If you’re selling your home yourself, and you open your front door to everyone who walks down the street and sees your sign, you may be spinning your wheels. I recommend that you ask buyers a few questions first to make sure they are qualified before wasting a lot of time with them.>

A qualified buyer is one who is ready, willing and able to purchase your home if it fits his needs. Many people who look at “For Sale by Owners” are curiosity seekers, inquisitive neighbors, and people with poor credit hoping to get you to help them with the financing.

Other buyers may be qualified, but they’re six months to two years away from being ready. They don’t want to bother a real estate agent yet, so they call and look at For Sale by Owner homes to get a feel for what’s available. Many of these folks have a home to sell first, or they need to save money for the down payment, or they may need to work on their credit rating. When everything else is finally in place, that’s when they seriously begin their search for homes working with a real estate agent.

I always “screen” buyers to make sure they are qualified before showing them homes. I won’t show a buyer a home unless I know he can afford the house, how much he has to put down, how good his credit is, how much he can pay each month, and how much money he will realistically walk away with when he sells his present home. Those are just a few of the questions that I recommend that you ask prospects before you show them your home.

Deadly Mistake #3 Pricing Your Home Incorrectly

As a seller, you want to sell your home for the most money possible. Putting too high of a price on your home will often get you less money than you could have realized by putting a fair market value price on your home.

Keep this statistic in mind: On the average, buyers are comparing your home to 15 to 20 other homes. If your house is not priced competitively, people looking at your home may reject your home in favor of superior homes priced comparably.

Overpricing your home usually increases the time on the market, and many buyers are aware of how long homes have been for sale. The longer your home is for sale, the more buyers are inclined to feel that there’s something “wrong” with it, and the lower the offers will be.

Deadly Mistake #4 Failing to Prepare Your Home for the Buyer’s Eye

Buyers look for homes, not houses. They end up buying the home that makes them most comfortable. It’s what I call the “Ah-ha” effect. Often a buyer will walk through the front door, and immediately fall in love with the house.

Owners who fail to make necessary repairs, who don’t spruce up the house inside and out, who don’t do all the little things that make a house show like a million bucks will suffer from lower offers and longer market time.

Deadly Mistake #5 Signing a Long-Term Listing Without a Written, Specific Performance Guarantee

Many times, an agent has good intentions about marketing your house, but circumstances can change. Some real estate agents are taught by their brokers to take any listing for any price, in an effort to begin to “control the inventory.” These agents seem genuine at first, but you never hear from them again.

Always protect yourself by making sure that you receive a written promise stating that you can cancel the listing, without charge, if the broker does not adhere to written performance details.

Sellers who don’t heed this advice sometimes wind up tying their home up for months on end, with absolutely no activity. Always protect yourself by getting a guarantee of specific performance with the right to cancel.

Deadly Mistake #6 Making it Hard for Qualified Buyers to Obtain Information

The 2 marketing tools that consumers think realtors use to sell homes (open houses and classified ads) are actually not very effective at all. Surprisingly, less that 1% of all homes are sold at an open house. As a matter of fact, real estate agents use open houses to attract potential prospects, and very seldom are able to sell the home itself.

Furthermore, dozens of advertising studies show that:
    less than 3% of people purchase their home as a result of calling on classified ads.
    77% of buyers use the internet to search for a home.
    The next largest source of information for buyers is a yard sign, mentioned by 71% of buyers.

When asked where they first learned about the home they actually purchased:

      24% from the internet
      36% from their real estate agent
      15% from yard signs
     25% from other sources.

When marketing your home, don’t just think that a classified ad will find the right buyer. It takes effort and persistence, but effort and persistence usually do not pay off in the long run.

Deadly Mistake #7 Not Using a Written Purchase Agreement

Many sellers think their home is sold, only to find out weeks or even months later that the buyer was not able to obtain a home loan. Other sellers find out too late that dozens of items such as surveys, title insurance contingencies, assessments, tax prorations, pest inspections, structural inspections and a host of other details can come back to haunt them if not properly addressed right at the very beginning. It’s not uncommon to see a buyer willing to terminate a transaction unless the seller agrees to absorb the expense of an item that realistically should have been a buyer’s expense. Had it been written into the purchase agreement to begin with, this would not have been a problem.