Five Tips for Selling a Home, Fast.
So, when after a mere four months my suburban Minneapolis home received an offer from buyers eager to take possession in an ambitious three weeks, I held my breath, hoping nothing would crop up to thwart the sale.
After all, I had heard the talk of how a newly adopted "code" for lenders is essentially an appraisal logjam, and my buyers' financing was contingent upon "satisfactory appraisal of the subject property," as their mortgage broker's letter read. How could I not worry?
I envisioned packing frantically and moving in just two and a half weeks, only to have the sale blow up, leaving me on the hook for two properties.
But lo' and behold, the closing happened on time -- not a single postponement, despite the havoc many say the new Home Valuation Code of Conduct wreaks. Just how did we do it? There are buyer and seller lessons here for every homeowner or wannabe.
If we assume the standard must-haves for a home sale are already in place -- the home is de-cluttered, clean, and in good condition -- then all you'll need are these five tips to help you achieve a quick sale.
1. Get your loan to underwriting before you even make an offer. My buyers, Dan and Kirstin Schultz, were not just pre-approved, they had been processed by underwriting before even making an offer on my 5-bedroom, 4-bath home on a pond (pictured). That's a step their mortgage broker, Brad Ganzer of Summit Mortgage in Maple Grove, MN, says more home buyers should take if they hope to reduce the growing number of home-closing delays creeping up in the wake of the May 2009 Home Valuation Code of Conduct, a set of lender guidelines meant to prevent collusion between lenders, appraisers and mortgage brokers.
With the buyers approved as a "sure thing," the main worry left is: Will the house past muster on price?
2. Focus on home "sold" prices. Don't spend too much time analyzing list prices -- after all, sellers can drop them dramatically overnight. Instead, study the "sold" prices so that you have a better grasp on the real market rate for the home before you get to the negotiation table. This should reduce your chances of multiple appraiser reviews before the lender approves the deal-or worse, nix it.
Many websites, such as Realtor sites and Zillow, let you view sold prices, but my personal favorite is Listingbook.com. (You'll need a real estate agent to set you up with an account.) Listingbook churns data out in near-real time. You can see that a house went under-contract yesterday, for example, as well as sold prices by the percentage of list price, or price per square foot.
I also studied weekly statistics on my particular suburb put out for by the Minneapolis Area Association of Realtors. Many major metro areas will have a Realtor association that publicizes this information.
3. Frequent open houses. Comparison shop by actually getting out of your home and into ones for sale. Yes, it's convenient to view listings on your computer or Blackberry, but once you've narrowed down the choices, view as many of them as you can in person, even if you are the seller. The best way to gauge the competition is to see it for yourself. Remember, marketing materials are just that. A listing agent is not likely to highlight the crack in the ceiling or the bent door frame.
4. Personalize the home's marketing for the Internet-savvy buyer. In addition to the information put out by my real estate agent, Pam Roderick, I also created a blog about my home and left a note on the dining room table directing people to the site. OnMapleGrovePond.com included helpful articles about features of my home that made it easier for prospective buyers to compare it to others. Granted, it helps that I'm a writer, but in these days where almost everyone and their dog has a blog, any seller could easily produce such a site. I predict that this will be the future of home marketing -- but be careful if you choose the do-it-yourself route, as you could also unwittingly offend a buyer or highlight a flaw rather than a selling point about the home.
5. Educate the appraiser about the home and neighborhood. Thanks to the new appraisals codes, which mandate the use of an appraisal management company, there is a good chance the appraiser will not be as familiar with the subject area as you are. "The problem today is you can't assume an appraiser knows the neighborhood or has access to all of the neighborhood transaction details in the MLS database, especially if they're from out of the area," says Walt Molony, spokesperson for the National Association of Realtors.
Owners should detail all improvements made to their home and how it may compare with the neighborhood norm. For example, I made sure that the appraiser knew that my home was one of a only handful that had upgraded from aluminum to fiber cement after a 2005 hail storm, whereas many neighbors had downgraded to vinyl.
"Any known recent neighborhood sales that were foreclosures or were in poor conditions also should be provided, along with valid comps," Molony told HousingWatch. Then compare that to the differences between traditional home values and distressed sale values and how the owner's home historically compares.
Share with us your ideas for a quick-turnaround on a home sale.