If you plan to sell your home this spring, you’re in luck. According to Trulia’s latest Inventory and Price Watch report, buyers far exceed the number of available homes for sale. This “seller’s market” environment means you have an incredible opportunity to maximize your home sale for greater profit.
When you sell your home, you often find yourself writing a big check to your realtor and the buyer’s agent. It’s the first time most consumer realize the expense that comes with real estate, when in retrospect, most of the work is done by technology.
There are a couple of ways you should consider saving your profits this season.
Technology has made selling a home so much simpler. More and more buyers are looking online, and they direct home tours. Other than some scheduling work, the listing agent you hire doesn’t do enough to justify a big commission. We consider this model outdated, and so do many others. In fact, the US Department of Justice is seeking to reduce commissions by encouraging brokerage models that save consumers money.
You don’t have to compromise the help of an agent, but you also don’t have to lose to profit to get your home sold. New real estate brokerage and technology models have streamlined contracts and paperwork with secure, cloud-based solutions to make it possible to charge less to list a home than the traditional brokerage. Agents unburdened with time-consuming tasks thanks to technology are able to do far more transactions than the traditional agent, without sacrificing personal service. This means you get more experienced agents (Tip: experience means closed transactions, not years in the business).
Reduced fee yet full service agents are available to you. Under this model, consumers pay less than the typical 3% to get an agent to help support the sale. Technology companies also offer a blend of both options, and that’s where savings back to you really come in. At Redefy for example, agent experts charge only $3000, get your home listed on the local MLS and syndicated on sites like Realtor.com, Zillow and Trulia. Agents are available to help facilitate the right pricing and get you to the closing table without breaking your bank account.
Here’s what you could save in a simple graphic:
Under a traditional brokerage, you can also negotiate with your listing agent to reduce their fee. You’ll have better luck negotiating if you’re working with an independent brokerage or if you have a more expensive property in a fast-moving market like San Francisco, Denver or Austin.
Before you get an agent, you need to prepare your home to sell. An agent may still give you some advice, but despite what you might see on HGTV, staging your home or hefty remodels rarely provide major financial returns.
Don’t hire a stager! There’s so much good advice available on DIY home staging that it’s easy to make your home look professionally staged for very little cost. These are the highlights:
- Focus on cleaning and de-cluttering: have minimal furniture in each room and remove rugs/mats to make the room appear larger.
- Keep surfaces clear and remove all personalized décor/photos. Interior designer Tanya Hembree advises that you have one large (neutral – not a giant stuffed bear!) statement piece in a room instead of a bunch of small knick-knacks. Less is definitely more!
- Freshen up the paint and go as neutral as possible.
- Open the curtains and pull the blinds up to let in the light. If you have a terrible view (i.e. your neighbor’s bathroom), opt for white sheers.
- Maximize curb appeal with neatly trimmed landscaping and clean walkways. Healthy potted flowers at the door are always welcoming.
The latest Cost vs. Value report by Remodeling magazine shows that few home remodeling projects pay you back 100 percent. The consensus is that you should only replace what’s broken, and focus on the exterior (paint, doors, yard) rather than the interior. An agent will be able to tell you what projects are essential for your home.
Skip the Home Warranty
In an aggressive market, you’re likely to have competing offers. You don’t have to offer the costly extras like a home warranty. Since you’re going to have an inspection anyway, the big stuff will already be dealt with. Plus, if your agent carries Errors & Omissions insurance, it can cover some post-closing undetected issues like mold and pest infestation.
Don’t Pay for Expensive Photography, VR or 360 Views
Go with an agent who can take good photos or includes them with their services. Virtual reality, 360-degree views and drone footage is impressive, but only makes a difference for luxury listings.
Do Your Homework to Price Your Home Correctly
It’s tempting to over-price in a competitive market. This won’t always work in your favor. The best strategy is to place your home at or just under the market value. This will get you competition and sometimes above-asking price. Understand that you can’t sell for a price higher than the appraisal unless you have a cash buyer. Review comps from recent closings, not just listings of homes currently on the market.
Don’t fall for “zestimates” or other valuations based on listing prices and irrelevant data. You want to have a home valuation based on recent sold prices of homes comparable to your own in your area. One way to get a home value is by asking Alexa what your home is worth on your Amazon Echo. The most accurate estimate comes from having an agent come to your house and compare the home valuation to your home’s unique features. Agents who consistently close home deals each month are more likely to arrive at the most accurate valuation.