If you haven’t sold a house in the past decade, brace yourself. Today’s buyers are demanding. They’re savvier about market dynamics and data and want to see houses on their own schedule, says Redfin’s chief economist, Nela Richardson. “We’re finding that buyers want access to your house when it works for them,” she says. “They don’t want to wait for the open house.” Baking cookies won’t cut it anymore.
Some things in your favor: Low interest rates are your friend too. Buyers know that rock-bottom mortgages can’t last forever. If interest rates start to tick up, there could well be a rush to buy. On the other hand, if rates go up too far, that will almost certainly dampen prices. “As a buyer’s monthly payment goes up with rising rates, something’s got to give—and that’s likely your home price,” says Keith Gumbinger, vice president of HSH, https://www.hsh.com/a mortgage information provider. In other words, sellers: If you snooze, you may well lose.
Your Action Plan
Sell first, then buy. The dilemma most sellers face is whether to buy a new place at the same time. In general, it’s smarter to sell before you buy—there’s nothing worse than having to carry two mortgages at once. You may be able to rent your house from the buyer for a few months, or at least find a short-term rental elsewhere. The one thing you don’t want to do is try to buy a new place with the contingency that you have to sell your old place first. Nothing kills a deal faster, especially if you’re up against other bidders.
Don’t just list your home—market it. Gorgeous photographs, video walk-throughs, perfect floor plans—buyers want it all. You need an agent who can develop a full-blown marketing plan, including social media. “People are doing so much more research ahead of time, going through listings online, and weeding out properties before they see them,” says Benjamin Beaver, an agent with Coldwell Banker in San Angelo, Texas. That’s especially true of millennial first-time buyers, who have grown up with information on demand.
Don’t “test” the market. Pricing right is an art these days. The last thing you want to do is accidentally list too high out of the gate. Not only does it require cutting the price—in many cases to less than the estimated value—but it also means more time on the market. “It’s not like the old days where you put in a 10% buffer,” says Jacquie Sebulsky, a broker with Cascade Sotheby’s International in Bend, Ore. “People are savvier, and many agents won’t even show a house if it’s overpriced.” According to Zillow Talk: The New Rules of Real Estate, a house that is priced right will sell in about half the time of one that is overpriced.
Another reason to price right: traffic. In the first week a listing goes on the market, it gets four times as many visits as a month later, Redfin found. Moreover, if you do end up dropping your price, says Richardson, it sends a signal to buyers that you’ll come down more. “One agent described it to me as ‘blood in the water,’ ” she says.
Fix what’s broken. Paul Reid, a Redfin agent in Southern California, recommends getting a home inspection and fixing any problems before you list the house, despite the out-of-pocket costs. “First-time homebuyers, in particular, don’t want to come in and do a ton of work,” he says. “They’re making a huge financial commitment and don’t want a money pit. I’ve seen it time and again where a buyer will get in escrow, have the inspection, and back out because the list is overwhelming.”
Go clean. Ten years ago it was mostly upper-end sellers (and maybe desperate ones) who went to the trouble to “stage” their home. Now, the idea that you need to clean out your closets, clear off the counters, take down your photos, and pare down the furniture and accessories is Real Estate 101. That said, you don’t need to hire anyone (though you may need to find someplace to store all your junk). Two areas not to forget: the entrance (that expression about not getting a second chance to make a good first impression is true) and the bathrooms. “I like to say that big, fluffy, white towels can add $10,000 to the price of a house,” says Sebulsky.