Having a hard time selling your house?

Now that we have returned to a much more normal market after a brief period of utter craziness, it’s time for a refresher course on what to do if your house didn’t immediately sell.

Real estate has always been about price, location and condition. All three of these must be in balance for a house to sell. Since you can’t change the location of a house, all you can control is the condition and price.

Here is what over 17 years of experience in good, bad, terrible, average, great and crazy markets have taught me:

When you get lots of showing but no offers

This usually means that buyers think the price is realistic based on what they see online so they schedule a showing and come check out your house. If you don’t get any offers, that means their expectation did not match the reality of the house. Sometimes this can be caused by having pictures that make the house appear to be in better condition than it is, bad curb appeal of the surrounding properties, or some negative thing omitted from the listing that buyers won’t discover until they get there. 99% of the time it is just because the house didn’t “Wow” the buyers in person as much as it did online.

An old school rule of thumb is that when you have had 10 showings and no offers, it is time to reduce the price. Sometimes if the feedback from showings is all the same, you can keep your old price and improve whatever negative thing buyers mentioned. I usually prefer a price reduction because often you can spend money correcting that one big negative only to have subsequent buyers find the next big negative. There is nothing more frustrating than spending money solving a problem only to later discover you’ve got another one to solve.

When you are not getting any showings at all

Usually when this happens it is because buyers know the price is way too high and don’t even bother to come see the house. Occasionally buyers can overlook your house if the presentation of the listing was terrible but I don’t see that happen often. Sometimes it can be because you’ve got too much junk all over the house and the pictures, while good, just show a cluttered mess. The thing to do here is reduce the price to be competitive with similar houses buyers may also be considering. Something that is hard for sellers to understand is that buyers are looking at more houses than just their home. To a seller, their home is all they are thinking about. To a buyer, it is just one of several homes they can buy. Buyers have options now. You’ve got to make your house become their first choice if you want to sell.

Over the past 17 years, I have seen sellers refuse to reduce their price or do anything to make their home more appealing to buyers. They usually think the issue is with their realtor…..if only the realtor would do more open houses, if only the realtor would advertise the house, if only the realtor had glossy brochures inside the house for buyers to take home. These sellers usually let the listing expire then pick a new realtor. It is at this time that the new realtor suggest dropping the price. It is also at this time that the seller cooperates. And guess what, with a lower price, the house sells.

Selling a house is not rocket science. All you are trying to do is make your house a buyer’s first choice. Back in 2009-2011 when the market was the worst ever, I would sell houses the first day on the market and have multiple offers. Many people thought I had a magic wand back then. I put the same effort in all my listings. It wasn’t me. It was my sellers. They were realistic and took my advice.

Best way to get top dollar for your house

I don’t really know how to say this without upsetting some of my realtor friends, but most of the current marketing trends are just hype.

Many agents are doing weekday open houses.  Like a Tuesday or Thursday from 5-7.  Often the house sells before the open house……and if the listing had hit the market that day, that is the exact time buyers would be scheduling their showing anyway.

Many agents are doing these “Coming Soon” listings.  After making everybody wait to see it, the house sells the first day on the market for full price.  Imagine that.  Just like every other new listing that is priced appropriately.

Some say that these are the best ways to expose the listing to a market that is already hungry for new listings, and at a time when there is a shortage of houses for sale.

Here is what I say is the absolute positively BEST way to know you got top dollar:

You put the house on the market late on a Friday.  Why?  So the listing gets fed to zillow and all the other real estate sites in enough time to get on every buyer’s radar but is too late to be shown that night.  Why again?  Because more people are available to look at a house on the weekend than they are during the week.  Why do you want that?  Because you want every buyer to not only see your house, but to also see every other buyer flocking to your house.  Nothing motivates a buyer more than seeing people coming and going during their viewing.

You show the house all weekend.

And this is where the rubber meets the road.  You tell all the agents that the seller is not making a decision until Sunday evening and to submit their client’s highest and best offer.  That gives time for the house to be seen by every interested buyer.  More interested buyers means more offers.  More offers means a better price and/or terms.

 

 

Why I let my sellers stay home 2-4 on Sundays

The house across the street from me recently sold.  There had been open houses almost every week that it was listed.  It had tons of people come see it.

Sounds great, right?

Doing a little research, there had been 82 sales of houses priced $50k less and $50k more than this house’s list price.  That is 82 sales all year.  In ALL of Lexington. And there had probably been about half that many people come to the open houses.  I know because I was home every Sunday between 2 and 4, usually washing my cars.  Could it be that there were half as many buyers out there looking as we have had sales all year?  Doubtful.  I bet most of those people are just out on a Sunday between 2 and 4 for entertainment.

Which gets me to my point.  No offense at all to the agent who had this house listed.  The agent did a great job.  The pictures looked great.  Great marketing too.  I just don’t think open houses really help sell a house.  In the internet age, exposure is never the problem.  I think they are one of the few tasks an agent can do that a seller can see.  It makes a seller feel good.

Selling a house is a lot like fishing.  You bait the hook with quality pictures and an attractive price, drop it in the water we call the internet, and wait for a bite.  Sellers don’t like that.  Sellers want action.  An open house is something they can see.  Even if at 4:05 when you are pulling the open house sign out of the yard and telling the seller the house didn’t sell, they are happier because they saw you do something.

I often have sellers ask about doing an open house.  I guess I could do one and make them feel happy, but I normally tell them how it really works.

I tell them that open houses are the 8 track player of the real estate world.  They hark back to the days when there were no pictures except maybe a black and white thumbnail of the front of the house in the newspaper.  An open house was the only chance a buyer had to see the inside.  Now we have multiple quality pictures, inside and out, and some even have pictures to show you what the house looks like to passing airplanes.

I tell them that most people that come to an open house are either just beginning their search and not ready to pull the trigger, or are neighbors, or bored, or even thieves.

I tell them that to believe the house will sell due to an open house means that we have to believe there is a buyer out there who wants to buy the house but is too afraid to call their own agent or the listing agent to schedule a time to see it.  And in this market, doesn’t mind the risk that it will sell before the open house.

I tell them I know all this because I use to do open houses all the time until I realized all I was doing was kicking them out of their home in the middle of one of their days off work.

And they always tell me they didn’t realize all that and to skip the open house.

In my opinion, the best thing you can do when your house hasn’t sold is to listen to the market.  If you get feedback from showings and most of the buyer’s thought the price was high, the house needed paint, or there was some other negative, you should fix the issues or reduce the price.  Remember my fishing analogy?  Not responding to the negatives is like fishing with the wrong bait.  Inviting all the fish to come see your bait will get you an audience, but they won’t bite if they don’t like it.

Oh, about that house across the street.  How did the buyer see the house?  They scheduled a private showing with their own agent.