You know, everyone seems to love first time home buyers. Real estate agents, mortgage brokers, banks, lawyers, the whole bunch. Everywhere you look online you’ll find someone mentioning how much they love first time home buyers or how they’re a specialist for first time buyers, OR an infinite number of guides for buying your first home.
Let me begin by saying, this article is not meant to scare you. These are all manageable situations. This is also not meant to criticise or put down sellers who may have done any of these in the past. The goal here is to prepare you for selling your first home!
But what about first time home sellers? When it is your first time selling a home it is arguably a more complicated process than buying a home, why does no one show a little love to the first time home sellers? Well rejoice, first timer, I wanted to compile a list of common mistakes and miscalculations I see made by first time home sellers. These range in timelines from before you list, to the during the time your home is listed, and even after the home has sold. So here are 8 common mistakes first time home sellers make and ways to avoid them to ensure a seamless transition to your next home.
1) Buying and Building Your Next Home First
Perhaps you’re in a scenario where your family has outgrown your current home and now it is time to move up to something larger. This is a very exciting time, and often growing families may look to purchase a new construction home to get the features, floorplan, and space they may need. Hell, this option may even make the most sense for a lot of people, and many go this route. However it’s very easy to paint yourself into a corner.
It’s easy to fall into the trap of thinking that “well this new home won’t be built for 8-12 months, we have plenty of time to sell our current one”. The reality however can be much different. Now the purpose of this blog is not to criticize your decision making process, you ultimately need to move, and more importantly this scenario is very manageable. HOWEVER, I just want to make sure you take time to take a step back and make a plan.
If you’re going to purchase a new construction home before selling your current one, make sure you plan for the worst case scenario. It is generally better to err on the side of caution and list your home too soon versus too late.
Perhaps you’re thinking what if my current home sells too quick? To that I say that is a great problem to have, especially in the current market. I know moving twice sucks, BUT, having to rent or stay with relatives for a short time is likely better than carrying two mortgages at the same time.
Scenario two is; budget for a few months of carrying two mortgages if need be. This situation isn’t ideal for everyone but if you can afford to carry both, selling your current home after you’ve moved out is often easier for everyone involved. Even better, if you owe very little on your current home feel free to take as long as you need. If you can afford to hold out for a better price on your current home after moving into your new one, all the better.
2) Thinking That The Comparables Don’t Apply to Your Home
So if you’re a first time home seller, well, that means this is your first home we’re talking about here! No doubt you have some incredibly special memories with this home that you will take with your for the rest of your life… BUT we do need to approach your home’s price with as objective of a frame as possible.
Despite the heartwarming notes above about your current home, the best advice I can give you as a first time seller is; buyer’s don’t exactly care. It is challenging as a seller to be completely objective about your home, however, I can tell you that a buyer will be looking at your home with an entirely clean slate and be as close to 100% objective as humanly possible.
Know that in our current market in Edmonton buyers have a lot of options, you will be competing with all the homes in the area as well as similar newly constructed ones. Also get to know the area around you and how it may have changed. Perhaps if you bought a new home as your first time the area has since been built out and your location is more desirable. Know how new subdivisions close by may be affecting your price, or how new commercial developments in your general area may make your home and neighbourhood more or less desirable.
The best route is to get a home valuation(s) and know where your home stands in the current market. Take the time to know the homes that are currently for sale as for what has sold, take a good look at them and ask yourself; “how does this truly compare to my home?”.
3) Not Getting More Than One Valuation and Exploring Your Options
As a smart consumer I’m going to say it is likely safe to assume you will explore more than one option for listing your house, which likely means interviewing more than one agent. Part of most agent interviews is a valuation of your home. As there is a human aspect to this process, the numbers will vary a little and it is good to get a few different takes on price to see where you stand.
Furthermore, it is good to explore the options out there and the different agents who you can work with. See what everyone has to offer and who perhaps is good at working with first time sellers such as yourself and ensuring you understand the process.
I’d hate to start turning this article into a pitch but just know that at my company I have several options for selling your home that fit your needs and take a modern approach to marketing, you can get some more info on that at the end of this article.
Further to the previous point about comparables, there is a chance some of the upgrades, features, and finishes in your home are more common than you think. Conversely, you may not be entirely aware of some of the features or aspects of your home that might make it attractive. Ensure not only that your home is being priced appropriately but that you are working with an agent who will do the marketing to show off all the best things your home has to offer.
4) Not looking into staging (cheaper than you think!)
Professional staging can be a great way to make your home stand out from the crowd. Staging also doesn’t necessarily mean bringing in thousands of dollars worth of new furniture and totally redoing the home. More often than not a good home stager can work with much of the furniture in your home and improve the look of it.
Most people (myself included) may not be the greatest at identifying the best and most flattering way to arrange furnishings in a room. A simple staging consultation with a professional can often drastically improve the flow of a home and better showcase the space.
Whether working with your existing furniture or if you’re looking to get some more designer items in there, staging is often cheaper than you think. Staged homes do generally sell faster, so even though you may be looking at a bit of a higher monthly cost it is often well worth your investment.
5) Making showings difficult or turning down showings
I’ll be the first to say, I’m empathetic to the fact that you have kids, keeping a home clean is difficult, there may be bedtimes to work around, the whole mix. However, I typically tell my clients that the pain is well worth it. Selling your home is an event and it typically requires extra effort in a few ways. It is best to approach the selling process with as open of a mind as possible and be willing to be flexible.
Often first timers may want strict showing windows and times, but this typically has a negative effect on the listing. Ultimately we’re dealing with the schedule of half dozen people to coordinate just one showing - so keeping things open is the best way to go. Buyers often are viewing other homes in the area and it is unfortunately quite hard to get them to come back at a different time. This also runs the risk of them seeing another property that they like better and never end up seeing yours.
Making your home available at the drop of a hat is challenging and definitely a skill in many ways. Just keep in mind the easier and more frictionless you can make showings on your home - the quicker you can sell. The extra effort is definitely not permanent! You rolling up your sleeves for the duration of your listing will definitely pay off.
6) Over Analyzing Buyer Feedback
Some buyers and/or buyer’s agents who show your home may provide you with some feedback. I can tell you after countless showings - both as a listing agent and a buyer’s agent - buyer’s either like the home or they don’t. When they don’t like it, it is more often for subjective reasons such as floor plan or the direction the home faces, proximity to something, too far from something; in other words - things very much out of your control!
If something is pervasively wrong about your home a prospective buyer and their agent will be courteous enough to let us know. But if there is no further interest, they typically just want to move on and will provide a few minor reasons it just wasn't quite the right fit.
For you the seller I would say, move on as well. That client wasn’t the right fit for your home, if there is a feature they didn’t like about the place don’t spend too much time dwelling on it. Let’s focus on finding the right person for the home you are selling.
7) Getting Mad at Lower Offers
Low offers can happen, plain and simple. Regardless of how an offer looks at first, rejoice! You have a real life person who is at least to some degree interested in buying your home. At the time of writing this most of Canada is arguably in some level of a buyer’s market - especially Alberta and Edmonton - meaning an offer is gold and we should do what we can to work with that party.
Also know what is par for the course; an offer $20,000 below ask on a $150,000 home is a pretty low offer but on a $800,000 home that would be considered a very strong offer! Like all things, it is relative.
The best advice I can give: keep your head up. Don’t take low offers personally. Generally most buyers don’t expect their first offer to be accepted. Also if you’re selling to a first time buyer they may not fully understand our side of the fence, that is, closing costs, payouts, and the works.
8) Not Having a Contingency Plan
Not having a plan B is probably the biggest miscalculation I see a first time seller make. Ultimately plan for all scenarios - the ideal scenario, the most likely, the worst case, and everything in between. Further to the above point, what if your current home takes longer to sell? What if it sells too quick?
Selling too quick is a good problem to have! If your home sells quick but perhaps you haven’t found your dream next home, have a back up plan so you don’t have to rush yourself. Perhaps a short term rental or living with relatives is an option (and yes I know, this may be a pain too!).
It boils down to - be prepared! Hopefully your agent will have this conversation up front with you to ensure you’re ready to sell.
To sum things up; you may have noticed these all sound like fairly manageable problems. The truth is, yes they are! Dealing with these scenarios is a very manageable task. The point here is not to scare you but ensure you are prepared for the task of your first time selling a home. I hope this information is useful to you and you take away the key lesson of: prepare, prepare, and then prepare some more.
Now you can stop reading the article here, BUT I may just have something to say that will be useful to you as a first time home seller.
I’m a real estate agent so I’ll address that I have some level of motive to this article which is to potentially draw in your business one day when you’re ready to sell. I don’t want to go into a heavy sales pitch but you should know that you have options when selling your home.
The company I work for has several home selling options that give you more freedom and choice when you sell. The goal is to both net you more money and save money on real estate commissions when compared to a more traditional fee structure. We have options for selling by owner, a full service lower commission model, and customized marketing plans to fit your specific needs. If you’re looking to sell in the Edmonton area get in touch with me today!
Hi! I'm Thomas and I'm your Low Fee Edmonton Real Estate Professional. Early in my career I realized that the methods of much of the realty industry were extremely dated and charged outrageous commissions. I chose to make a move that allows me to better serve clients at a much more reasonable rate. I am committed to saving every client thousands on fees in every transaction, buy or sell. Get in touch today!
© 2020 Thomas Harrington - REVERE Real Estate
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