How To Sell A House Without A REALTOR in Massachusetts

The thought of saving a real estate commission when selling a home in Massachusetts can certainly be a tempting one. And make you wonder how to sell a house without a Realtor in Massachusetts. With list-side commissions of 2-4% on a median house price of around $560,000 in Massachusetts that could mean a saving of $11,200 to $22,000 in just the list-side commission.

How to sell a home without a Massachusetts Realtor

So can I sell a house without a REALTOR in Massachusetts?

The easy answer is use you certainly don’t have to use a REALTOR to sell your home. You can certainly go it alone as a For Sale By Owner (FSBO).

A bigger question to ask yourself is do you want to put in the time, energy and effort to sell your home without a Massachusetts REALTOR?

What Does It Take To Sell Your Home Without A REALTOR In Massachusetts

When selling your home as a For Sale By Owner you think you are saving thousands on a real estate commission. But, rather than thinking you are saving on a real estate commission, you are actually earning it.

You need to have a lot of time and a certain amount of knowledge to get your house sold as a Massachusetts FSBO.

Before deciding to sell your house without a REALTOR in Massachusetts, determine your goals and what you expect from the final outcome to be by foregoing using a Massachusetts real estate agent to list your home.

FSBO Statistics

The National Association of REALTORS annually provides different statistics for REALTORS and the general public.

  • For 2020 roughly 10% of home sales were private sales, this includes FSBO, transfers between families and other private transfers.
  • The average FSBO sold for $225,000 whereas the average agent-assisted sale sold for $330,000.

Now before you go off the deep end, there are several reasons why the For Sale By Owner sold for less. First, you have to remember there are a certain amount of sales between family members and third parties that are discounted. The goal of these sales is not necessarily to achieve top dollar.

But a Massachusetts FSBO will often sell for 10-15% less than a sale where a REALTOR is used. The most common reasons are lack of knowledge, not able to put enough time into the sale, and lack of exposure.

A Real-Life Example of A FSBO vs a REALTOR in Massachusetts

A while back I had the opportunity to list a stand-alone condominium alongside another Massachusetts real estate agent and an owner trying to sell on their own.

The units were essentially identical and should have sold within several thousand dollars of each other. The results were:

  • My unit sold for $360,000 in 45 days.
  • The other agent sold their unit for $345,000 in 106 days.
  • The FSBO sold their unit for $323,000 while on the market for almost a year.

I almost listed the FSBO after talking to the owner. They were tired, they were upset and they were about to give up when they accepted the offer of $323,000.

In retrospect did the FSBO save money? I think when you look at the time and effort expended and the actual sale price they would have been far better off hiring a REALTOR to list their home.

My point is not to discourage you from selling your home alone. If you decide to sell your Massachusetts home without a REALTOR realize you will earn every penny and maybe saving on all or portion of a real estate commission doesn’t mean you save money.

Rather than focusing on what the commission is that you are paying, focus on how much money you will net when the sale is done.

National Association of REALTORS statistics on FSBOs selling a home with out a Massachusetts REALTOR

4 Key Phases Of Selling Your Home Without a REALTOR

There are four distinct phases in the home sale process. Those four major phases are preparing the home, pricing the home, presenting the home and closing on the home.

For a successful Massachusetts home sale, each phase of the sale needs attention. Normally your listing agent would help and guide you with each of these phases. But, as a FSBO you need to go it alone.

Preparing Your Home

Preparing your home is the critical first step to a successful sale. This means everything from a deep clean, a thorough decluttering and staging your home to appeal to today’s home buyers.

Getting your home ready for the market may also include improving your home’s curb appeal, small repairs and even some minor renovations.

Your local REALTOR in Massachusetts will know where to spend your time energy and efforts to maximize the return on your home. As a FSBO it will fall on you to figure out what needs to be done.

Often times a seller will start the process before meeting with an agent. And, will find they may be focusing time and money in areas of the home that are not important.

Pricing Your Massachusetts Home

After deciding what you should or are willing to do to prepare your home for the Massachusetts real estate market, it is now time to price your home.

Pricing a home is part art and part science and sometimes can be a difficult task. A real estate agent has the Massachusetts Multiple Listing Service as a tool to research similar properties that are on the market, under agreement, recently sold or expired unsold.

When you hire a REALTOR to list your home they will provide a comprehensive report called a Comparative Market Analysis or CMA.

A FSBO must realize their house is competing with similar homes in the market. The basis of the CMA is to find comparable homes that have recently sold in the same neighborhood. A REALTOR will have an understanding of the appraisal process and where to make adjustments for certain amenities.

As a For-Sale-By-Owner it will be your job to find comparable homes and set the proper prices.

A home’s listing price can make or break you. List even ten thousand too high and your home can make languish on the market.

Presentation

Once you have prepared your home and have it priced properly it is time to present your home to the buying public. The biggest hurdle a FSBO has when it comes time to sell their home on their own is marketing.

The key to getting the best price for your home is exposure. You want to give your home the broadest appeal possible and get it in front of as many eyes as possible. Your home may be awesome but if buyers don’t know it’s on the market they can’t buy it.

The internet plays a large role in exposing your home to the right buyers. The biggest tool an agent has is the MLS. The Massachusetts MLS has around 30,000 members that share listings and feed the latest Massachusetts homes for sale to a large pool of buyers.

I strongly suggest getting your home into the MLS by using a company that does entry-only listings. An entry-only listing is where you pay a brokerage to enter a listing into the MLS but they do not represent you in the sale of your home.

Remember your house will be competing with homes that have been professionally staged, have had professional real estate photos, floorplans, 3d models, aerial photography and more.

An experienced REALTOR in MA will include all of these services in their listing commission and as a FSBO you should consider paying for the same services so your house can compete on the same level.

A top-notch Massachusetts REALTOR listing your home will also have a strong internet presence and will be able to push your home out onto the internet through many channels including social media.

Closing

There are many aspects to getting a home closed on time. Much of it revolves around paperwork.

It is strongly recommended you work with a real estate attorney to help you with the flow of documents and keep the sale legal.

As a seller, you need to provide: a new deed, a Municipal lien certificate, Title V certification (if you have a septic system), a 6D certificate if you are selling a condo and a Certificate of Compliance for your smoke and carbon monoxide detectors.

This Is Just The Tip Of The Iceberg

The major phases of selling a home as a Massachusetts homeowner has been spelled out in a quick overview. But, each phase has many steps that need to be taken.

Missing or overlooking a step can have serious legal or financial ramifications. And it is important to have the right real estate attorney looking over your shoulder.

Selling A Home Without A REALTOR in Massachusetts Might Be Right For You If:

You Already Have A Buyer

Sometimes as you prepare your house for sale and let your family, neighbors and friends know you will be selling, a buyer will come out of the woodwork.

If you have a ready, willing and able buyer to purchase your home at a price you are comfortable with, heck, save the commission.

You Want To Save on The Real Estate Commission

Many homeowners try to go it alone and sell their homes without a REALTOR. Their number one goal is saving big dollars on a commission.

Savvy FSBOs still offer the buy-side commission to drastically improve the buying pool for their home.

You Are In A Seller’s Market

A hot seller’s market like we have been in for the past few years makes it easier to forgo a listing agent. Buyers are desperate with low inventories and competitive bidding wars. They will leave no stone unturned.

As the market cools down and becomes a buyer’s market more market and buyer insight and marketing and negotiating skills will be needed that a Realtor in Massachusetts will have.

Selling A Home Without A REALTOR in Massachusetts Might Not Be Right For You If:

You Have Never Sold a Massachusetts Home Before

There are a lot of moving parts to sell a home. An experienced REALTOR knows exactly what needs to be done and has a proven process to get your home sold.

The worst part of trying to buy or sell a home on your own is you don’t know what you don’t know. And, it’s what you don’t know that gets you in trouble.

Without experiencing a sale of a home previously, you may not have a full understanding of some of the critical steps. Because of this reason, it may be wise to hire a REALTOR to sell your Massachusetts home.

No Time

As pointed out earlier while you can pocket thousands of dollars in real estate commissions that aren’t paid out, you will probably earn every penny.

You will need the time to research the process, figure out how to best prepare your home, coordinate paperwork, coordinate showings, etc….

A listing agent can spend as little as 10 hours and as many as 80 hours bringing a home to market and then to a smooth closing. And unfortunately, much of that time is not dictated by you, but by interested parties in your home. You must strike while the iron is hot.

Do you really have the time to sell your home on your own?

The Savings May Only Be A Matter of Perception

Statistics show that FSBOs sell for less than homes that are sold by real estate agents. The reasons can vary.

But, there are several that might stand out. A FSBO may not have the knowledge and market savvy that a real estate agent has. They also lack the marketing channels that are at a real estate agents fingertips.

It is all about exposing the home to as many buyers as possible and finding the right buyer. And on top of it, you will have to spend money that an agent would to market the property.

Several Things A REALTOR in Massachusetts Can Provide A Home Seller

Market and Buyer Insight

Full-time real estate agents are immersed in real estate every day. We know how to interpret the market. We know what most buyers want in a home.

If you never worked a shifting market or run around with home buyers how are you going to be able to make informed decisions?

True Story, Swear To God

Years ago, I showed a entry-only for a FSBO listing, to a couple I was working with to buy a home. From the moment we walked thru the door to the moment we left, the seller was obsessed with how much money he spent soundproofing his basement….. He basically followed us around the house telling us about it.

So first, it was so distracting we probably didn’t pay attention to what really would interest my buyers. Secondly, I have never had a buyer list a soundproofed basement on their wants and needs list.

And third, ewww that’s creepy. Why do you need a soundproofed basement? My buyers were freaked out!! And, couldn’t get away fast enough.

The point is the seller missed the mark about what is important to the buyers of his home. Plus to my next point, for whatever reason, he was highly emotional. It is important to know what buyers are looking for in a home.

Negotiating Expertise

As a real estate agent, a large part of any day is filled with negotiating. Whether it is an offer on a home, home inspection repairs, or a myriad of other issues that arise during a closing, a portion of any day is spent negotiating.

Negotiating techniques have been developed and specifically an understanding of generally how a buyer or seller will react. This can be an invaluable skill a REALTOR in Massachusetts can bring to any client.

A Voice Of Reason

Buying or selling a home can be highly emotional for some. You could be overly proud of your home and the effort you put into it. Or, you can be very nostalgic because you raised your family in your and there are many fond memories.

But emotions can get you to make poor decisions.

A real estate agent can provide an objective perspective to the decision-making process. They will keep you on track with your goals.

An Experienced REALTOR in Massachusetts Has A Track to Run On

After 20 years in of buying and selling real estate in Massachusetts, I have a process to sell your home.

From preparing your home to sell, pricing your home, marketing and showing your home to managing the paperwork and bringing you to a smooth closing there is a proven plan to get the job done.

Real estate is also dynamic. What I did 10 years ago or even 3 years ago is different than what I do today. That plan is always being tweaked to benefit my home sellers.

What A Massachusetts Home Seller Needs To Be Aware Of

There are several areas that a For Sale By Owner Needs to be aware of to avoid legal issues.

Property Disclosure

Often a brokerage will ask a seller to fill out a Seller’s Statement of Property Condition or SSPC. It is the opportunity for a seller to disclose various aspects of the property.

Massachusetts is one of the few states that is what is called a caveat emptor state or basically buyers beware. It is not required for a seller to disclose anything about a property except whether a home does or does not have lead paint and whether the home is served by a septic system.

A property without an SSPC may be suspect to potential buyers and many questions will ensue. While you are not obligated to disclose anything upfront you do need to answer any questions truthfully.

Accuracy

Whether you are answering a question from a buyer or you are filling out specs on a home, accuracy is important.

Square footage, lot size, and room dimensions, etc…. should be accurately stated and verified. Anything in writing, like a listing description of your home’s specifications, can be a potential liability down the road.

Be as accurate as possible. If you don’t know don’t assume.

Fair Housing Laws

When selling your home on your own you are not exempt from Massachusetts Fair Housing Laws. It is your responsibility to understand Fair Housing Laws.

Massachusetts and Federal law prohibit discrimination in the sale of a home by owners, landlords, property managers, mortgage lenders, and real estate agents. These fair housing laws make it unlawful to discriminate based on: race, color, national origin, gender, gender identity, sexual orientation, disability, ancestry, genetic information, marital status, veteran or active military status, age, familial status (i.e., children), and source of income.

It’s The Benign Statement That Can Get You In Trouble

A Massachusetts Realtor spends time every year staying up on fair housing laws and usually knows what to steer away from.

For example, it is a violation in a listing description to say “family neighborhood”. Or you could be in violation by saying it is a “short walk” to the school.

By mentioning “family neighborhood”, you could be discriminating against buyers who are not a family. A “short walk” can be viewed as discriminating against someone with disabilities.

Review the protected classes and avoid making any discriminatory remarks. In general, keep your conversation about the property and not about the people.

The Four Biggest Hurdles To Overcome By Foregoing a REALTOR In Massachusetts

There are going to be several hurdles you need to overcome to sell your Massachusetts home on your own.

Understanding The Market

Often a buyer or seller is often running on older market data. But markets can turn on a dime as 2022 real estate market is a prime example. You need to current data and what is happening with current market conditions and be able to interrupt them to make decisions moving forward.

For example, if you try to price a house like sellers were in April of 2022 you will probably find your home languishing on the market and chasing the market down.

Know How To Set A Listing Price

Your home’s listing price is a fickle thing. Even appraisers and real estate agents can struggle with certain houses in some markets. Never mind, being a FSBO and not understanding all the principles that go into pricing a home.

The proper asking price on your home is about 60% of the sale of your home. List even 2% to 3% over fair market value can be a certain death for the sale of your home.

Don’t think you can ask 10% over asking and the buyers will just make offers. Or tack on another 5% for negotiations.

Choose valid comparable homes, understand your comps, make adjustments and set the proper asking price for your home.

Marketing Exposure

A big hurdle for a FSBO is exposing their home to the majority of potential home buyers that might consider their home.

A Massachusetts Realtor only has to upload your listing into the MLS and it will immediately be sent to thousands of potential buyers within 24 hours. But on top of that agents have other means of syndicating your home on hundreds if not thousands of real estate websites immediately.

Not only does an agent have multiple sources of advertising your home they know how to do it properly. In this day and age taking a few out-of-focus, dark pictures and posting them on the internet is no longer suitable. Professionally staged homes that are professionally photographed are the norm for homes that are listed in 2022.

Sticking a sign in the lawn and telling the neighbors is not going to provide the exposure you need.

Paperwork and Legality

Selling a Massachusetts Home is a complex legal transaction.

It is important to keep the transaction on track and legal. A missed date, having the wrong people sign a purchase and sale contract ( and it happens more than your think) not having the proper paperwork for the closing can all throw a monkey wrench into the works.

Another True Story

Years ago there was a FSBO who signed two contracts to sell their home. In all the excitement and emotion they signed a contract with one buyer then immediately received a higher offer and signed that one as well thinking they could easily pull out of the first contract.

Not so easy and very sticky. The legal aspect went on for years and the original seller lost the home to foreclosure as the battle went on in the courts.

Have a full understanding of the contracts and paperwork that will be needed for the sale of your home. Contracts are legal and binding. They are not easily broken.

Hurdles that a for sale by owner must overcome

Summary

It is certainly possible to sell your home without a REALTOR in Massachusetts. The question remains is it the right decision for you.

There are a lot of moving parts to sell a home and as a FSBO you need to be prepared for the task. To successfully sell a home on your own you will have to put in a lot of time and effort. It goes beyond slapping a sign in the yard. You will have to have an understanding of the legal aspects, necessary contracts, the process and how to market your property to the right buyers.

Weigh your options carefully and decide if it is the right choice for you.

Other Real EstatateResources

  • As a home seller, this article has discussed whether a seller should use a REALTOR or not. Luke Skar discusses where a buyer should use a REALTOR when buying a home. There are many advantages to having a REALTOR in your corner when you buy a home.
  • As real estate markets across the country slow down we are hearing about contingencies in a real estate contract again. In hot markets, a contingency in a contract meant you weren’t getting a home. Vicki Moore discusses the use of contingencies when buying a home.
  • If your selling your home without a REALTOR there is a lot to know. Paul Sian shares some tips when selling your home on your own.

How To Sell A House Without A REALTOR in Massachusetts is provided by Kevin Vitali of EXIT Realty. If you would like to sell or buy a home, give me a call at 978-360-0422 and let’s get the process started.

REALTOR Services in the following areas: Northeast Massachusetts, Merrimack Valley, Northshore and Metrowest. Including the following communities and the surrounding areas- Amesbury, Andover, Billerica, Burlington, Chelmsford, Dracut, Groveland, Haverhill, Lowell, Melrose, Merrimac, Methuen, Middleton, North Andover, North Reading, Reading, Stoneham, Tewksbury, Tyngsborough, Wakefield, Wilmington, Westford

Things You Should Never Say or Do In Your Real Estate Listing

10 Things you should never say or do in your real estate listingOnce you list your home the most important marketing tool you have is your listing. 

Your listing is your public facing information. 

It includes photographs, description and basic statistics of your home.  Your homes listing data will be the same across the board whether it is a real estate agents website, Zillow, Realtor.com or any other real estate portal  found on the internet. 

But there are things you should never say or do in your real estate listing of your home.

Your real estate listing should be compelling and inviting and make your target buyers want to see your house.

Where Does Your Real Estate Listing Information Come From?

First lets look at where your homes stats and images come from and then look at how it get to the other public real estate portals out there.

Your homes photographs and information are going to come from several sources.

  1. The seller.  You, the seller are going to provide basic information on your home as you know it.  Basic stats, what you know about the homes maintenance, renovations etc…
  2. Public information.  Some of the information like tax assessment, zoning, lot, easement data and so on…. will be gathered from various town and county sites.
  3. Your listing agent.  Will verify and assess what information is correct and what should be used in your home’s listing.  Often they are relying on you for accurate information.  They will also provide services like a real estate photographer to help complete your listing.

From There Your Listing Is Uploaded

Once all the data is compiled, descriptions are written, all the data along with your homes professional real estate photography is uploaded into your agent’s local Multiple Listing Service.  The multiple listing service is a mechanism for which almost every real estate agents belong to and allows them to share inventory from a large database on a local level.

When your homes listing data is uploaded to the MLS literally thousands of public facing real estate portals take the information and package it to fit the format of their site, using some or all of the information provided.

Your Real Estate Listing Is Your Most Important Marketing Effort

When you list you home there is nothing more important than how your listing presents itself online or what I call web appeal.  

Over 85% of the buyers who may be interested in your home will have their first exposure to your home from the real estate listing as it is presented online.   If you don’t capture their attention online you lost them for good.

If your listing doesn’t present well or it presents wrong, you may find a long road ahead of you.  It is important your data and listing is complete and accurate from the get go.  New listings are exciting and can gain a lot of attention.  As a home sits on the market they lose their “new” polish and shine

The goal of marketing your property is to interest the broadest range of buyers that would truly consider your home.

What Things Should You Never Say Or Do When Marketing Your Home Online?

#1 Use Bad Real Estate Photography

Past the price of your home, the bedroom count and the bathroom count, nothing is more important than your homes photographs.  Based on a recent study.  The average home buyer spends 93 seconds looking at a listing.  60% of that is spent looking at the photographs alone. With almost 25% of that time looking at the front photo alone!

It is now common practice for many agents to use a professional real estate photographer.  If your photos are blurry, poorly lit, crooked etc… you will lose interest from buyers before they truly get a good look at your home.

The photos below are the same listing.  The verticals were taken for a prior listing that expired.  The second were taken by me after repackaging the listing.  Almost the exact same shots, different quality.

things to never say or do in a real estate listing

#2 Selling As-Is

For most sellers, advertising your home for sale as-is, will be a big mistake.  Yes there is a time and place to sell your house as-is.  But for the average home, in livable shape, you are creating a perception for the buyers.  A bad perception.

Advertising your home as-is creates two red flags in a home buyer’s mind.

First and foremost it leaves the buying public thinking there is something so wrong with your house.  As-is is usually a term that home buyers connect with houses that are in such dire repair a bank will not finance them and are reserved for cash deals.

It also screams to the buyer, I am totally inflexible, it is my way or the highway. 

You will turn away buyers by using the term sold as-is in your real estate listing, that could be potentially good buyers for your home.

#3 Asking Price is Firm

By announcing your asking price is firm, again you are telling potential buyer’s you are completely inflexible.    Yes I get it, you don’t want to play games and haggle. 

But announcing it up front, turns away many buyers.   You want buyers submitting offers.  Its a starting point for negotiations.

I can’t tell you how many times I have negotiated a low ball offer into an offer a home seller finds acceptable.  Not every offer may work but at least it is an opportunity.

Remember home buying is emotional.  In many cases, you need a home buyer to fall in love with your house.  Let them fall in love with your house first.  Prior to an actual visit to your home, a home buyer will be more likely to approach your home transactionally and with no or little emotion.

If you are firm on your listing price, tell them after they submit an offer, thank you for your offer but we are looking for full price.  They are emotionally involved at that point.

#4 Home Buyers Must Be Pre-Approved

I have been in the business a long time.  And, yes many buyer’s are pre-approved when they call me. 

But others are not.  The minute they call, I  and many other agents get them started on the pre-approval process immediately.

All it takes sometimes is that one house for a casual buyer to get excited and run out and get pre-approved immediately and in turn become a serious buyer.  Insisting every buyer who comes through the door must provide evidence they are pre-approved could turn some of the best buyers away.

Otherwise, the perfect buyer for your home could be sitting there, loving your house online, but thinking oh this house will be gone before I can get pre-approved.

Insist on a pre-approval prior to negotiating an offer, not when it hits the internet.

#5 Over Exaggerating The Description Of Your Home

Your home is what it is.  A buyer will quickly know that you exaggerated the description as soon as they walk through the door.  Don’t try to make your house into something it isn’t.

And, I will say it again you want to market your home to the right buyers. 

For example:

A home with a 17 year old kitchen, is not a home with a recent kitchen remodel.  For many kitchens, styling trends can make a kitchen remodel outdated after 10 years.

A home needing a new roof, new furnace, window upgrades is not a home in pristine condition, leaving nothing to be done.

Focus on the true features and benefits of your home and don’t make you home something it is not in your real estate listing.

#6 Counting Rooms As Bedrooms That Are Not True Bedrooms

This is a biggy.  Don’t state that a room is a bedroom unless it is truly a legal bedroom. 

What makes a bedroom legal? A bedroom must have certain egresses, be heated and have sewer/septic capacity . 

The biggest problem is basement bedrooms.  They don’t have safe egresses in case of a fire.  Many buyers will not count a basement bedroom as a bedroom, primarily because it does not meet fire codes.

Many buyers have specific minimum bedroom requirements.  They will also have certain expectations like a closet, where it is located in the home, etc….   Nothing is a bigger turn off to a buyer to find out your 4 bedroom home is really a 3 bedroom home. 

#7 Falsely Stating The Square Footage Of Your Home

Calculating your homes square footage or living area is pretty cut and dry.  The standard is set by FannieMae and what appraisers are and are not allowed to use when appraising a home.

Simply put its the outside foundation dimension of any above grade area that is heated.  A homes living area should never include any unheated areas like 3 season rooms, breezeways or unheated attic rooms.  Nor should it include any below grade living areas in a basement. 

It is certainly alright to identify and show the benefit of these areas but do not include it in the square footage.

It is frustrating for a buyer to see a house listed as 2400 square feet and than get there to find out half of it is a basement remodel. 

#8 Making Subjective Statements

Be very careful making subjective statements that a buyer can not assess about your house at the time of a showing.  Two words that pop into mind on homes I see all the time are “safe” and “quiet”

Both are very subjective to the individual, but more importantly can lead to liability issues.  If a buyer should buy based on your assessment of “safe” or “quiet” but finds it not so, after they move in, it can lead to a law suit.

#9 Repeating The Obvious In Your Homes Description

Just about every front facing real estate listing’s first view of a home. is a picture of the front of the home, along with the price, bedroom count, bathroom count and size of the home.

Do not repeat the obvious in the real estate description in your listing.  The buyers are already aware.  The description is meant to highlight features of your home that are not obvious.  Why is your large lot unique?  One of the bedrooms is an incredible master suite, or your kitchen is remodeled with the most current styling.

Restating the already obvious is a big mistake in your real estate listing.  YOu have limited space to tell your homes story, don’t waste it.

#10 Violate Fair Housing Laws

Every state will have a different set of Fair Housing Laws.  Fair Housing laws prevent you from discriminating against a class of people.

One phrase you see occasionally pop up in a real estate listing is “family neighborhood”.  In Massachusetts, this can be construed to be in violation of two protected classes of people.  Age and marital status are both protected classes of people in which that statement could be construed as being exclusionary towards.

Also, in Massachusetts, Handicapped people are a protected class.  You could be found in violation of fair housing laws to say your home is in “walking distance” of…..  You are now excluding handicapped (who can’t walk) people from buying your home.

Violating Fair Housing Laws carries some steep fines and can open you up to law suits.

A good rule of thumb is don’t talk about people talk about the property.  And, always double check to make sure you aren’t excluding a protected class with your language or trying or trying to steer a protected class to your property. 

#10 Seller Is Motivated

You may be a motivated seller and that is all right. 

By announcing it to the world you won’t gain a damn thing, accept invite obnoxious offers.  The buyer’s perception will be you are desperate and they will try and take advantage of the situation.

You can be motivated and price your home to sell and accomplish the same thing without announcing to the world take advantage of me!

Remember These Final Thoughts

  1. Real Estate Photography is THE first exposure your buyers have to your home.  Make sure it captures there attention and want to look into your home.
  2. Don’t turn buyers away before ever coming though the door with lots of no’s or negatives.  Let them come and fall in love with your house.  Showings = Offers. 
  3. Don’t make your home into something it isn’t.  Focus on the features and benefits of your home.  A home needs to stand on its own merit at a given price to sell. 

The good news is an experienced listing agent can help you with all of this.  Providing real estate photography, floor plans, compiling and verifying data and presenting your home in it’s best light.

Home Marketing Resources:

This article, Things You Should Never Say or Do In Your Real Estate Listing, was provided by Kevin Vitali of EXIT Group One Real Estate. I have helped 100’s of home buyers and sellers over the years and am confident my experience and skills can make purchasing your next home a pleasant experience. Please feel free to reach me at 978-360-0422 to discuss your upcoming purchase.

What Not To Say Or Do In Your Real Estate Listing

 

Top Mistakes When Hiring A Listing Agent

Top Mistakes When Hiring A Listing Agent When listing a home much of the success lies with the real estate agent you choose. Avoid the top mistakes when hiring a listing agent to list and sell your home.

Hire the right listing agent and things will go relatively smoothly, but hire the wrong listing agent and you will end up disappointed in the end. Take the time to interview several agents so you have a full understanding of what is ahead of you. 

You will be in a contract with your listing agent for a period of time which will be difficult break.  Make sure you are hiring a great listing agent who does the right things to sell your home.

Top Mistakes When Hiring A Listing Agent

Often mistakes made when hiring a listing agent has to do with your preconceived notions or emotions about your own home.  Go into interviewing listing agents with an open mind and carefully listen to what they have to say. 

I can tell you I have been in the business almost 18 years and selling a home today is very different than in 2007, which was very different than selling a home in 2002.  You may have sold a home 15 years ago but how you sell a home is very different and you need to understand how real estate is sold today so you don’t make mistakes when hiring your listing agent.

Hiring The Agent That Gives You The Highest Price

There is a term used in the real estate industry.  Its called buying a listing.

“Buying a listing” is when an agent gives a seller an overinflated price for your home.  And, of course as a seller you want to believe it.  They are the expert who are you to argue.

The unscrupulous agent is playing on your emotions.  Many sellers will hire an agent based solely on the list price given by the agent, only to be thoroughly frustrated and disappointed down the road.  They “buy your listing” knowing full well they can’t sell your house for that price.

The agent who buys your listing knows once your in a contract with them, there is nothing you can do to break the contract.  Your stuck with them for the life of the contract. 

And, they will immediately start badgering you for a price reduction the first couple weeks after being so confident they can sell your house for that initial price they gave you.

60-70% of selling your home is about pricing it correctly to begin with.  There is no single aspect more critical than how you price your home.

While pricing a home correctly can require a little finesse, it is all about data.  A listing agent should be able to back up a list price with data and not tell you how to price your house but show you similar homes to yours that have recently sold.

Common mistakes home sellers make when hiring a listing agent to sell their homeHiring the Yes Man

The Yes Man or Woman is adept and hearing you out and telling you what you want to hear. They will agree with you about pricing, agree you don’t have to do any repairs, tell you your home is wonderful, etc… 

Of course you have already formed opinions about what you should and shouldn’t be doing and what your house is worth.  And, would it be great to find an agent that is completely on board with what you what to happen?

But you don’t want a yes man to list your home.  You need someone that will tell you the truth and give you the cold hard facts, whether it agrees with what you think or not. 

Much of what revolves around listing a home is based on data.  A lot of what an agent is telling you can be backed up with data.  Always be leery of an agent who tells you a lot but shows you nothing.

Hiring A Family Member or Friend

Hiring an agent that is a family member of friend can certainly lead to trouble. Don’t automatically go and hire the first friend or family member you can think of that is a real estate agent.

The first things to consider when contemplating hiring a family member or friend is……  do you want them all up in your business? And, if things go bad between the two of you can your relationship survive?

Christmas at grandmas can get very uncomfortable if one of you is unhappy with the business relationship.

If you can get past those two considerations don’t hire them just because you know them. 

You have too much at stake, have them interview and work for you listing just like every other agent.  Just because someone holds a real estate agent does not mean they have the experience to sell your home. 

Not all agents are created equal.  Are they equally qualified to sell your home as other agents you interviewed?

Maybe they are and that is fine.  But do your homework.

Only Interviewing One Agent

Most people only sell a home once or twice in a lifetime. There is a lot of moving pieces to selling a home and it behooves a home seller to learn as much about it as possible. 

You may just love that first agent you interviewed but do yourself a favor and interview more than one to make comparisons between each. 

I encourage a home seller to interview three or four agents.  Make sure you discuss market conditions, proper pricing of your home, marketing and what you can do to enhance your homes saleability. 

Obviously look for an agent that is compatible and communicates effectively who backs up what they say with data and finally who has a strong marketing plan.

Hiring A Part Time Agent

It took me a good five years and over 100 deals working full time to feel confident as a real estate agent.  Every deal is so drastically different in real estate.

Experience matters when it comes to real estate.  Understanding the market, buyer psychology, negotiating is not something you can get a handle on over night.

Not only that if they have a full time job they cannot fully dedicate the time needed to get your house sold.  Much of real estate has to be performed in a timely manner and there are just times you can’t wait 8 hours to get a contract signed or to return a phone call.

Hire an agent that is full time in the business and is experienced.

Hiring The Agent With The Lowest Commission

Some home owners think hiring the agent with the lowest commission is going to net them more money.  There is nothing that can be more wrong than that mentality. 

Here is a real life scenario from a stand alone condo I listed years ago with two others being on the market at the same time.  All of this units were identical and should have sold with in $5,000 of each other.

  Condo 1 Condo 2 Condo 3
  Listed by Me Listed By Other Agent Listed by Owner
Sales Price $360,000 $345,000 $323,000
DOM 45 105 1 year
Commission $18,000 $17,250 $0
Net after Commission $342,000 $327,500 $323,000

 

The For Sale By Owner that was trying to save a commission was the big loser netting less than if I sold the property at a 5% commission.  The For Sale By Owner left $19,000 on the table.  What could you do with $19,000 in your pocket?

Take Condo 2 and charge only a 4% commission while I charged 5%…. I still netted the seller $11,800. Furthermore, I still could have charged a 7% commission and netted the seller $3,000 more. 

Why?  Services, I offer more and do more to market a property than the other two. While yes, if all things are equal, hire the agent with the lower commission. 

But usually this is not the case, there is a reason why one agent charges more of a commission than the next.  Look at the agents entire presentation before you make a decision to hire based on the lowest commission charged.

Do not assume a lower commission will net you more money.

Hiring A Real Estate Company Instead of the Agent

Many sellers think that if they use an agent from the largest company that is the route they should go.  But at the end of the day, it is the agent that ultimately gets your home sold not the company.

The the individual agent’s market knowledge, marketing and negotiating skills is what gets the job done, not the company.

The single important thing you should look at is an agent’s marketing plan…. or what they are going to do to sell your home.  Pay close attention to the details and the differences between agents this is what separates a good agent from a great agent.

Hiring The Agent Who Promises The Most Open Houses

Some agents promise open houses because it is has results that can easily be seen.  Showing the seller, my agent is here for hours, every weekend, trying to sell my house.

Yet statistics show that less than 2-3% of homes are sold as a direct result of an open house.  That is a whole lot of work for very poor results.  While yes, there is a time and a place for open houses it is only a small part of an over all marketing plan.

If the agent drops the ball in other areas, like providing professional quality real estate photography and leveraging the high quality images of your home over the internet, no amount of open houses will sell your home.

What sellers fail to realize is open houses open up their home to anyone.  The only qualifier is the attendee can make it through the front door.  You need to ask, how many of your open house attendees are prepared to close on your home in the next 60 days…. shockingly very few.  So who is showing up at your open house?

There are far more important aspects of marketing a home than having open houses every weekend.  Like everything these much of selling a home is about the internet or what I call web appeal.  Can your agent deliver web appeal of your home?

So Who Should I Hire to List My Home?

As your interviewing agents you should look for the following:

  • An agent with a clearly spelled out marketing plan on how and why they do the things to market your home.  An agents marketing plan is probably the single most important differential among agents.  A good listing agent will have a clearly defined process.
  • An agent that educates you on the process of selling your home from A-Z.  There are many moving parts to selling your home and it is important you understand each aspect.
  • An agent that educates you about current market conditions as well as where it has recently been and where it is headed.  Current market conditions dictate so much of what is happening in real estate.  Often a buyer or sellers perception of the market is 6 to 12 months behind what it currently is.
  • An agent who provides you with data to choose the proper list price for your home.  Understanding the proper pricing of your home and how long it will take to sell your home, as well as current conditions is dictated by data.  That data is past sales history.
  • An agent who has experience and can provide references. from recently closed satisfied clients.
  • An agent that will give advice on how to prepare your home for sale.  There are three critical pieces to selling your home.  Preparation, pricing and presentation.  And, certainly a little preparation can go a long way.
  • An agent that is not afraid to give you some hard truths when needed.  You need to count on your agent giving you the truth.  Sugar coating or avoiding the truth just leads to your disappointment.
  • An agent that communicates well.  Selling a home is a collaborative effort and you and your listing agent must communicate effectively.
  • An agent you are comfortable working with.  You are going to be in a relationship with your listing agent and you need to hire someone that you are comfortable with.

Avoid mistakes when hiring a Tewksbury MA listing agent and find the success you want in the sale of your home.

This post, Top Mistakes When Hiring A Listing Agent was provided by Kevin Vitali of EXIT Group One Real Estate.  Kevin Vitali is a Tewksbury MA REALTOR® that services northern Middlesex county as well as Essex county in Massachusetts.  Are you thinking of listing your Tewksbury MA home or a home in the surrounding communities call Kevin at 978-360-0422

Turning the American Dream Into A Nightmare

14 Common Home Buying MistakesBuying a home is a big deal.  There are many aspects and phases of buying a home that legal and financial ramifications while going through the home buying process as well as long after you have closed on your home.  Good decisions need to be made.  Avoid these common home buying mistakes that can turn the American Dream into a nightmare.

14 Common Home Buying Mistakes

Failing to Get Pre-Approved

Getting a mortgage pre-approval letter is the first step of the home buying process. And one that should not be skipped.  When it comes to financing a home don’t assume anything.  Get pre-approved early so you know exactly what a house will cost you and you head off any problems at the beginning of the process.

Getting pre-approved before you look at houses will end up saving you time and money as well as lessen the stress of home buying.

Not Knowing What You Don’t Know

Buying a home can be a complex process financially, legally and procedurally.  But many buyer’s get caught up in the excitement and the pace of buying a home with out seeking out the proper help they need.  

It is important to realize you don’t know what you don’t know when it comes to buying a home. It is equally important to seek out the proper help.  There are plenty of people who do know like real estate agents, real estate attorneys, home inspectors, etc… than can help guide you thru certain aspects of the home buying process.

Missing a vital step or not understanding part of the process can easily cost you money.

Not Understanding the Money Involved in Buying a Home

Usually most people go into buying a home knowing they have to put down a down payment. Often a buyer may overlook the other costs associated with buying a home. 

On top of you down payment you will have closing costs, pre-funded escrow accounts, home inspection fees, moving costs and more….  Again, a reason to get pre-approved early so you do understand all of the costs associated with getting a loan in the way of closing costs, escrows and prepaids.

Your real estate agent can help you plan on additional costs outside getting a mortgage.

Not Understanding How Your Agent Works for You

Real estate agency is the law behind the capacity in which an agent works for you.  Laws vary from state to state but it is critical to understand the relationship you have with your agent.  It can make or break you.

Not all agents work for you.  And this is what trips up many home buyers, who work with an agent they think is acting in their best interest, but in fact is acting in the sellers best interest by a legal agreement. 

Not Using A Buyers Agent

Here in Massachusetts a Buyer’s Agent is the only agency relationship where the agent works for the buyer and owes them a fiduciary responsibility (in most states).  A buyer’s agents job is to counsel a buyer through each step of the process to the buyer’s benefit.

Buying a House With A Dual Agent

Dual Agency is a very complicated form of agency where an agent represents both buyer and seller in the same transaction.  Unfortunately you give up many of the rights you would have in a single family situation.  Unfortunately in the haste to get a property under agreement the buyer and seller don’t take the time to fully understand what they are giving up.

Personally, I and many of my counterparts feel that dual agency should be banned as it does not benefit either party and it is a very confusing form of agency.

Buying A House Directly From The Listing Agent

Either by niavity, or because a buyer thinks they will get an inside deal, buyers will go directly to the listing agent to buy a house.  Yet, the listing agent is supposed to give the seller every advantage they legally can along the way, often at your expense.  

How an agent works for you may never come into play, but when there is a conflict between buyers and sellers how an agent works for you definitely can definitely make a difference in the outcome.

Falling in Love with The Eye Candy and Not Paying Attention To What is Important

Did you ever hear the phrase “pig with lipstick”?  Often it is easy for us to get get all googly eyed over granite, stainlles appliances, new laminate floors, etc….  But at the end of the day you need a house with good bones and no significant repairs like a roof looming around the corner. 

You can live with an outdated bath or hardwood floor that needs to be finished but you can’t live with a broken furnace or a leaky roof.  Analyze the soundness of the structure and systems before getting caught up in the bling.

Buying a Home Strictly on Emotion

I have had buyers fall in love with the wrong home and buy for all the wrong reasons.  Some will even admit they are.  But try and remove the emotion and make sure your house is satisfying your needs on all the important levels. 

Don’t fall in love with a home because you love the backyard with a pool, if the house is absolutely wrong for your family.  Or some other reason.  Compromises do need to be made when you are buying a home but make sure they are practical compromises.

Over Spending on a Home

Just because the bank can approve you for more money doesn’t mean you can afford it.  Only you can determine that for yourself.  Create a budget and run your numbers and make sure your mortgage payments work for your individual circumstances.

It is human nature to want more than what your budget allows. But after your purchase you will want extra money to live life and improve the house the way you want it and not scrape by every month to pay the mortgage.

Not Having A Home Inspection

The home you may be buying may look to be in terrific shape.  And in a hot real estate market it may be tempting to remove your home inspection contingency to strengthen your offer.

The whole purpose of a home inspection is for a trained and licensed professional to go over your purchase with a fine tooth comb and identify potential latent issues that could result in significant repairs in the near term.

As good as a a home may look, you don’t want to get saddled with tens of thousands of dollars worth of repairs shortly after moving in.  There are certainly repairs that just cannot be put off and require immediate attention.

14 Common Home Buying Mistakes

Not Paying Attention To Your Home Inspection Results

It one thing to have a home inspection because you think you should.  But often a home buyer uses the home inspection to check out the house and see where the furniture will go.  Instead you should show up and be engaged with the home inspector.

Ask questions, many home inspectors can be a valuable resource on long term maintenance as well as important issues that need immediate attention.  When the home inspection is complete thoroughly review the inspection report and if you don’t understand something…. ask!

Your home inspection is the last line of defense in buying a home that is structurally sound with all major systems working properly while providing a healthy environment to live in. 

Not Doing Your Due Diligence

Ok, you found the perfect home.  But don’t forget to do your due diligence while in the home inspection period.  Has the house had significant work where permits should have been pulled? Is your 3 family really zoned as a three family?  How is the neighborhood? Is there anything surrounding your home that would impact your enjoyment of your new home?

I once had a neighbor buy a house next to me.  Little did they realize their property abutted the railroad tracks they were shocked and not to happy.  But a quick drive around the neighboring streets would have revealed that down the embankment behind the trees was an active railway!!

Taking the time to do some due diligence would have prevented the problem.

Buying a House That Requires Too Much Work

Often a home buyer will think if they buy a fixxer upper they will save money.  There is a couple problems with this thinking.

First, a home buyer will fail to think ahead and figure on where the money is going to come from to do the repairs and renovations, often leaving much of the work undone.  Secondly they fail to assess their own skills in completing the work in a craftsmen like manner leaving any of the work undone sub par.

While you can save money buying a fixxer upper it is certainly not for every homeowner.

 

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Turning the American Dream Into A Nightmare is written by Kevin Vitali of EXIT Group One Real Estate. If you would like to sell your home or buy a new home give me a call at 978-360-0422 and let’s get the process started.

Real Estate Services in the following areas: Northeast Massachusetts, Merrimack Valley, North Shore and Metrowest. Including the following communities and the surrounding area- Amesbury, Andover, Billerica, Burlington, Chelmsford, Dracut, Groveland, Haverhill, Lowell, Melrose, Merrimac, Methuen, Middleton, North Andover, North Reading, Reading, Stoneham, Tewksbury, Tyngsborough, Wakefield, Wilmington, Westford

9 Mistakes Home Buyers Make in a Hot Seller’s Market

9 Mistakes Home Buyers Make in a Hot Seller's MarketIn my little part of the real estate world the real estate market is hot. Open houses are flooded with 40 – 50 buyers in an afternoon, with multiple offers that Monday or Tuesday. It is certainly a red hot seller’s market.

I also hear from many of my counterparts across the country and hear similar news.  The real estate market is a hot seller’s market in many markets across the country.

Unfortunately its not all that fun to be a buyer in a hot seller’s market.

But for most home buyer’s there are factors that make it the right time to buy.   It could be expanding family, looking for the stability of owning a home, find it costs the same as renting, etc…  Whatever reason the timing is right to either move up, downsize or become a first time home owner.

A hot seller’s market definitely presents challenges for home buyers and there are things that home buyers do that can hinder their own home buying success.

9 Mistakes Home Buyers Make in a Hot Seller’s Market

Not Fully Understanding the Market You Are In

Understanding current market conditions is very important, irregardless of what market you are in.  Many buyers enter the market and find a house they like and ask how much of a discount can they expect during negotiations.

My response will be to slap them across the face and ask them if they are mad!!

Just kidding.  But have you not been paying attention?  We were tripping over 30 people in the house during our showing and I sent you market stats, did you not review them?

Sit down with your agent and review market statistics so you can get an understanding of what the current conditions are for your local real estate market.

In the Massachusetts MLS there were about 9000 single family homes on the market in the past year.  Even in the peak of the market in 2005 there were over 15,000 homes.  Inventory is very, very low.

Furthermore, in one of my local markets of Tewksbury MA homes are selling at 100% of the original list price as opposed to 2009 homes were selling for 92% of list price.

The underlying fact is we are seeing a market we have never seen before.  Buyers are forced to compete hard for houses.

Market conditions will dictate how you look for homes, what you pay for a home and how you negotiate a contract and home inspections of a home.  Get an overview of of how current conditions affect your purchase.

Not getting into properties right away

If you are serious about buying a home in this market you need to get in the home within a day or two of it coming on the market.  When you are in a seller’s market the average days a home spends on the market is very low.  Don’t call on a Monday, expecting a showing for Saturday.  It will most likely be sold already.

Find a way to get into the home immediately, don’t wait.  If you can’t, hopefully your buyer’s agent can preview a home for you and let you know if it is worth dropping everything to see or not.

In this current market, time is of the essence.  Getting in right away allows you to make a decision and do any of your due diligence on the home.

Not Writing Offers

Write offers on homes you like.

Just because you may be competing with other buyers with multiple offers, does not mean you shouldn’t try.  Determine your numbers and stick to it.  Not every home that has multiple offers goes over asking.

The reality is if you want to buy a house your going to lose some.  I have worked with some buyers where it took 12 offer before they purchased a home.  But know, it is like this for every other buyer in this sellers market.

I can guarantee you if you never write an offer there’s a 100 percent chance you won’t buy a home.  Take that chance, write an offer and put your best foot forward.  Remember some one is going to buy a house, it might as well be you.

The biggest reason I hear for not wanting to put in an offer is that the home buyer is afraid of over paying.  But let me put this in perspective for you.

If a home has multiple offers a group of buyers have stood up and said I want this home!  You know you can turn it around and sell it for pretty much what you paid for it.  There is already a demand for your house.

Does it make you feel better to negotiate $12,000 off of a home that no one else is bidding on, or wants, that has been sitting on the market for 4 months?

Waiting to Buy a Home

Some home buyers think waiting is going to change something for the better.  But it most circumstances there can’t be anything farther from the truth.

I watched home buyers in the early 2000’s “wait” and they missed their opportunity.  The same will happen again.

There are three reasons home buyers think waiting is going to help.

The market will turn around and prices will drop

Let me address the market turn around first.  While yes real estate markets go up and down, I don’t think we will see a catastrophic crash causing prices to drop drastically.  What I think we will see is the market will become more balanced and homes will only appreciate slightly every year.  But still prices will rise at a far more moderate rate.

Waiting for the market to turn around and prices to fall is called market timing.  And market timing is not an easy thing to do and rarely works out well for anyone.

They will save more money so they can buy what they want or they will wait till something better comes along

Home appreciation varies from town to town but it is not unusual to see many towns around me seeing homes appreciating at 7% a year.

Take a $400,000 home.  Next year if prices appreciate accordingly, those $400,000 homes, that weren’t acceptable to you, will now be selling for $428,000.  And, now a year later you will be looking at what were homes in the $375k range now selling for around 400k.

On top of it you want to jump up into a better home by saving more money.  Can you truly save $50,000 in one year?  First you just have to cover the appreciation of the home and than save at least a minimum of 5% to get into another class of home.

Compound that with interest rates rising.  It is predicted interest rates are going to rise about a half of a percent in the near term.  Every 1/8 of a point in interest rate translates to $8 per 100,000 borrowed.  a 400,000 home today will cost you $128 a more a month in mortgage payment.

So to buy the same 400,000 home you can buy today, will essentially cost you $428,000 and you will be paying. If interest rates your rise a half of percent your buying power a year later is essentially $355,000.

Every month that goes by you lose buying power.

9 Mistakes Home Buyers Make in a Hot Seller's Market

Not Being Realistic

Searching for that home that doesn’t exist or what I call chasing unicorns,  will just cause frustration and waste valuable time.  What your sister bought two years ago or what you friend bought a year ago probably doesn’t exist.

A quick search sold homes in the past year will help you find where your reality lies.

For example, I had a woman who wanted a condo with 2 bedrooms and 1.5 baths in certain communities… basically a huge section between Boston and the NH border.  There was one undesirable condo that she didn’t want.  I told her she needed to adjust her expectations.  She said she would just wait.  I checked back a year in the sold history and told her that only 3 such properties had sold and that the chances of one coming up again was probably not a reality.  She still did not want to accept her reality.

Deal with the inventory that is in front of you.  That is your reality.  If you see 10 -15 houses in a certain price range, in a given community, this gives you a great indication of what is available.

Hesitating

In a seller’s market you don’t have the luxury of mulling over a property for a week, going back another one or two times and bringing mom and dad to see.  The market is just moving too fast.

You need to be ready to pull the trigger the minute the right house comes up.  Even sleeping on a house over night can cost you the home you want.

Being Too Focused on Price

In no means am I telling you to run out and overpay for a house.  But in a seller’s market, it is not unusual for homes to sell at or over asking.

In the past 3 months, 41 single family homes sold in Tewksbury MA.  23 of those 41 sold at asking or over asking.  While most were no more than $5,000 over the list price, some went as high as $50,000 over.  Another 7 sold for with in $5,000 of asking price.

Remember fair market value is a range it is not one number.  In a seller’s market you will be paying towards the top end of the range.  Have your agent run numbers and see what that range is for a given home.

What is $5-10,000 at the end of the day…. $25-50 a month in payment.

Not Working With A Seasoned Professional

Align yourself with a seasoned buyer’s agent who will represent your best interest.   A seasoned buyer’s agent knows the market but more importantly knows how to handle the market.

They can impart the wisdom of 100’s of transaction into your home purchase.  Different negotiations styles need to be used in different real estate markets but also on different properties.  A buyer’s agent will help you formulate a plan that gets you into a home you like.

Not Putting Your Best Foot Forward

Many buyers think they should negotiate like it is 2009…..  start your offer price way below asking and meet in the middle.  For most homes in a seller’s market this is a huge mistake.  You will be writing offer after offer with no results.

First, you have to remember, you are competing with other buyers.  You don’t have the luxury of time on your side and you can’t drag out negotiations for days.  Another buyer will come along and best you.

Also, when it comes to multiple offers buyers are of the mind set a seller will come back and ask for final and best. But that is not true, a seller can handle multiple offers any way they want.  They can just pick the best one, decide to negotiate with a few, ask for final and best, etc….

If you like a home put your best foot forward right away.  Show the seller your serious and get the house under contract.

Final Thoughts

For whatever reason you find yourself buying in a seller’s market and the timing is right for you.  It is not easy for a buyer in a seller’s market.  You need to be diligent and focused if you want to buy a home.

The alternative is stay put or to pay ultra high rents.

Do you want to keep paying your landlords mortgage or start down the path of paying your own mortgage and building equity for yourself.

The good news if you are selling to purchase another home you will reap the benefits of a hot sellers market on the selling side.

Other Home Buying Resources:

9 Mistakes Home Buyers Make in a Hot Seller’s Market is written by Kevin Vitali of EXIT Group One Real Estate.

If you would like to sell your home or buy a new home give me a call at 978-360-0422 and let’s get the process started.

Real Estate Services in the following areas: Northeast Massachusetts, Merrimack Valley, North Shore and Metrowest. Including the following communities and the surrounding area- Amesbury, Andover, Billerica, Burlington, Chelmsford, Dracut, Groveland, Haverhill, Lowell, Melrose, Merrimac, Methuen, Middleton, North Andover, North Reading, Reading, Stoneham, Tewksbury, Tyngsborough, Wakefield, Wilmington, Westford

Dual Agency- Welcome to the Dark Side of Real Estate

what is dual agencyMost home buyers and sellers have some concept of single agency when it comes to real estate.  Agency is the relationship between a home buyer or home seller and their real estate agent.  Agency determines who the agent works for in the relationship and what level of service they can provide you.

You have the listing agent or seller’s agent that work for a seller and owes the seller a fiduciary responsibility.  Or, you have the buyer’s agent who represents the buyer and owes them a fiduciary responsibility.

When you are involved in a transaction, understanding your agency relationship is extremely important.  Especially as a home buyer an agent can work with you, not necessarily for you, in several ways.

What is Dual Agency?

Dual Agency is when an agent represents both the buyer and seller.

 An agency relationship implies there is a fiduciary responsibility.  A fiduciary responsibility is the highest level of care a buyer or seller can receive.  In many definitions of fiduciary duty it often says the fiduciary has to put the clients needs before their own or any other.

Your going to ask “Kevin, how is that possible to represent both the buyer and seller at the same time?”

My response is “It is not”

Dual Agency is the dark side of real estate.  Dual agency puts an agent in conflict over their fiduciary responsibilities.

Yet, Dual Agency is perfectly legal in the state of Massachusetts and other states across the county.  As far as the government and real estate law is concerned there is nothing wrong with it.  Though, it is important to check state laws as it can vary greatly from state to state.

Many agents will practice dual agency when the opportunity arises. Yet, there are others who won’t practice dual agency because they have an ethical problem with it.

I fall in the camp of I have a problem with dual agency. 

Dual Agency Must Be Disclosed

As you read this article.  One thing to remember is Dual Agency must be disclosed to both the buyer or seller before a showing can occur.  This means that the both parties must agree to dual agency. 

The problem is in how it is explained to both buyer and seller.  If you are fully informed of what rights you are giving up and you are comfortable with it, by all means consider dual agency. 

But inherently there is some problems with dual agency, which we will discuss  in this article.

When Could Dual Agency Occur?

I am going to simplify this because there are some finer points of real estate agency.  So there are two scenarios that could trigger a dual agency situation.

First, is a buyer comes to an open house and wants to be represented by a buyer’s agent and wants to put an offer in directly with the listing agent.  The listing agent agrees to represent the buyer as well as the seller.  This would trigger disclosing both parties that the agent is working as a dual agent.

Second, is an agent or another agent in the same office has a buyer already.  As a buyer client they come to a listing of that agent or one from the same office.  Remember agency falls back to the broker of record and the agents are acting under the umbrella of the broker.

The only way the parties can proceed as is, is to agree to dual agency.  If a buyer or seller does not agree one party has to be referred out to another agent or agency where than both parties can be fully represented by their own

What is Wrong with Dual Agency?

A Dual Agent Can’t Fully Represent You

Lets look at what happens, you find an agent you are happy with and you decide to have them represent you to either sell your home or help you buy a new home.

Represent you.  This ultimately means your needs, as a client, must come before anything and everything else. The full fiduciary responsibility of an agent working for a buyer or seller is obedience, loyalty, disclosure, confidentiality, accountability and reasonable care.  Just about everyone of the responsibilities is in conflict in a dual agency situation.

Dual Agency bypasses the fiduciary duty to fully represent you.  Your agent now really becomes a more of a facilitator or a paper pusher.  They can not favor one party over the other and cannot not perform any duties that would give one party and advantage over another.

This can be very hard to stay completely neutral.

Now how disappointing is it to find an agent you want to represent you and to have them tell you they are in a dual agency situation and cannot provide the counsel they promised you. 

What Can’t a Dual Agent Do that a Single Agent Can?

Home Sellers- Dual Agents can’t and shouldn’t:

  • negotiate an offer on your behalf
  • give opinion of offer and it’s strength and weaknesses
  • counsel you on whether you should accept an or not accept an offer
  • recommend specific service providers like an attorney
  • negotiate concessions or repairs after the buyers home inspection.

Home Buyers- Dual Agents can’t and shouldn’t:

  • give opinion of value
  • help structure an offer beneficial to the buyer
  • negotiate your offer on the buyers behalf
  • recommend their preferred service providers like home inspectors and attorneys
  • make negotiation recommendations after the home inspection and negotiate the repairs or concessions.

In either case, your agent in a dual agency situation, cannot provide you the counsel you were expecting when you hired them as your buyer’s or seller’s agent. 

Who Does Dual Agency Benefit

Quite frankly dual agency doesn’t really benefit the home buyer and home seller in any way.  The client is giving up some of the rights that they would have in single agency situation where the agent (or agency) represents one party only in the transaction.

So who benefits? The agent/agency…. it is there chance to get the full commission without sharing it with another agent.  If a seller agent becomes a dual agent they are getting both the list side commission and the sell side commission.  It is a double pay day.

The One Explaining Dual Agency Has a Vested Interest

If your agent approaches you about dual agency, remember that agent has a vested interest as I explained above. 

This is where the problem lies.  Are they explaining dual agency without glossing over the finer points of what you are giving up?  Or are they fully explaining they cannot fully perform the duties as they outlined when you hired them.

I recently had an open house and a buyer wanted to write an offer.  I said sure meet me at the office after the open house but be aware I work for the seller and owe them a fiduciary responsibility.  They said fine.

We meet at the office and they started asking me to help them get the best price for the house, what was the sellers bottom line, could I give them an idea what the house was worth, they would want a recommendation for a good home inspector, etc…  Now these are all tasks a Massachuesetts buyer’s agent can perform in a single agency situation, but one a dual agent should not perform.

I can certainly write an offer for a buyer as a sellers agent with the understanding from the buyer that I am merely facilitating the offer and I represent the seller’s best interest.  They are on their own.  In no way am I representing them. 

 But these buyers wanted, and quite frankly, needed the full services a buyer’s agent can provide.

I will not generally work as a dual agent.  Why?  I feel the seller or buyer has hired me to represent them a certain way and I owe them that.  I also believe that dual agency is very difficult to practice properly.  It opens up liability for me and for my seller.

After I explained agency in full, we both decided it was best if I referred them out to another agency to be represented.  Yes, I gave up half the commission, but it was the right thing to do.

Liability of Dual Agency

This is especially important to a seller, more so than a buyer in a dual agency transaction.  Your agent is an extension of you and you are ultimately responsible for your agents actions.  It is called vicarious liability.

With that said most real estate law suits come about over agency and/or property disclosure.  When you have your listing agent and the buyer has a buyer’s agent there is a line between the two and provides you with the least amount of liability. 

As a dual agent that line gets very, very grey.  Is your agent practicing dual agency the way they are supposed to?  Are they presenting any liability issues for you?

So What Should I Do If I Am Presented with Dual Agency?

Dual agency must be disclosed to both parties prior to even a showing.  Both parties have the option of rejecting dual agency.  I would say for the majority of home buyer’s and seller’s reject dual agency, you are giving up to many services that a single agency relationship provides you.

Agents that practice dual agency have several reasons that they throw around for it being a benefit.

Smoother Transaction-  There may be some truth to that but in most cases there is much co-operation between the seller and the buyer’s agent.  Both agents are working diligently to get the job done.  Generally, if a deal is difficult it is not because there is another agent involved. 

Savings- There is the thought that a buyer can save money by buying directly thru the list agent.  Me personally and many agents I know…. not going to happen.  Its twice the work and I am under contract for the same commission either way.

The only time I would even consider dual agency for a buyer and seller is if they are both savvy real estate buyers and sellers.  For example if the buyer is an investor that has bought and sold a number of properties and a seller that has sold several properties. 

But if this is your first or second time around the block, reject dual agency it is does not benefit you and you are giving up too many services from the agent who is supposed to represent you.

what is dual agency

Summary of Dual Agency

Please, please take the time to understand real estate agency.  I can’t tell you how misinformed real estate consumers, especially buyers, are on how an agent represents them.  I have run into buyers, who are shocked to find out their agent doesn’t work for them or they are in a dual agency situation. 

Dual Agency is a choice and you can choose to participate or not to participate.  In the story above, that same buyer did go on to buy my sellers home and both parties were fully represented by agents. 

Most of my buyers and sellers hire me partly because they are seeking quality advice, reassurance and guidance.  I can’t always give you that in a dual agency situation.  You are going to be on your own on a lot of the decisions that need to be made that a typical client would be looking for input on from their agent.

Personally I would not do it as a buyer or seller.  There is absolutely no benefit to you in most cases. 

As a last thought, I tell home buyers and sellers, you don’t know what you don’t know. 

What My Counter Parts Have to Say About Dual Agency

What Other Sites Have to Say About Dual Agency

Dual Agency- Welcome to the Dark Side of Real Estate is provided by Kevin Vitali a Massachusetts REALTOR located in Tewksbury MA. If you would like to sell your home or buy a new home give me a call at 978-360-0422 and let’s get the process started.

Real Estate Services in the following areas: Northeast Massachusetts, Merrimack Valley, North Shore and Metrowest. Including the following communities and the surrounding area- Amesbury, Andover, Billerica, Burlington, Chelmsford, Dracut, Groveland, Haverhill, Lowell, Melrose, Merrimac, Methuen, Middleton, North Andover, North Reading, Reading, Stoneham, Tewksbury, Tyngsborough, Wakefield, Wilmington, Westford

Reading Between the Lines of Your Home Buyer’s Feedback

Home Buyer's Feedback It is so much work to get your house ready to sell.  You take weeks even months preparing your home, the showings start and you are so anxious to get feedback from each home buyer, hoping this is the one.  Sometimes the home buyer’s feedback is straight forward other times it needs to be put in context with other home buyers feedback to get a full understanding of what is going on.

Home buyer feedback is one of the best tools we have to monitor what is going on with your listing and make any adjustments as needed, whether it may be a price adjustment or maybe a repair or some little tweeks.

Feedback can actually be a fickle thing and it has taken many years for me to understand some of the subtle nuances in reading between the lines of home buyer’s feedback.

Look at Home Buyer’s Feedback Holistically

One negative comment does not mean the world is ending.  Everyone is different and will have a variety of opinions as well as wants and needs in a home.

What you are looking for is a pattern.  Do you keep receiving the same negative feedback over and over again?  Once you start receiving the same negative comment for a number of your showings, you have a decision to make.

Maybe it is something you can correct, then by all means do so, if practical.

If it is not practical to do so or it is a negative that can’t be corrected the only way to address it is a price change.  When trying to properly price a home there are so many factors that are hard to even put a number on. 

In my neck of the woods, extremely small lots, houses built on slabs, location differences even function and appeal differences are very hard to put an exact number on when it comes time to determine the proper list price of your home.  Remember, fair market value of your home was probably given to you in a pretty wide range.  But, with most home sellers they automatically go to the top of the range and forget where the bottom was.

But eventually your home buyer’s feedback may reveal what is going.

When the feedback has a pattern, it definitely makes it easy to make the necessary adjustment.

Home Buyer Feedback

 

 

When the Home Buyer’s Feedback is Not So Straight Forward

As an agent that has been listing homes for many years, there are two things that can happen that indicate you have overpriced your home.

  1. There is plenty of decent feedback with no offers.  You will have plenty of showings and your feedback will be decent, as matter of a fact there might not be one negative comment at all.  But still no offer.
  2. The feedback is mostly negative but with no pattern.   You will hear the house is too small, the yard is too small, the rooms are choppy, etc….  Yet there will be no clear pattern to sink your teeth into.

In general, for a typical home in a community, 12-15 showings should bring you an acceptable offer on your home.  Once you start hitting 15-20 showings with no offer the buying public is giving you feedback….

Reading between the lines the feedback is we don’t find your home compelling enough to make an offer.

You May Not Get Feedback From Every Home Buyer

Frustrating as it may be, you are not going to get feedback from every buyer and or agent.  Would it be nice, yes, but will it always happen, no. 

Don’t be the seller that calls looking for feedback before the home buyer’s have left the house.  Your agents phone call for feedback is not going to change how the home buyer’s perceived your home or make them write an offer. 

Let’s take it one step further.  If as an agent representing a home buyer we see a home that my buyer’s love more often than not we rush back to the office to get an offer in right away. 

A lack of home buyer feedback and no offer is feedback in itself…. what is it saying?

“No we don’t want to buy your house, it doesn’t suit our needs” Or,

“Your house isn’t compelling enough to make an offer” Or

“We feel we can do better based on what we are seeing”

Home Buyers Are Empowered by the Internet

Understanding today’s home buyer’s will give you some insight. The internet has certainly empowered the home buyer with the amount of information they can get on a home.

A home buyer gets the thought to buy.  Often a home buyer will spend months even up to a year just looking at homes on the internet. 

Finally they may venture out and start doing some drive-bys and open houses.

Then usually they start viewing homes with an agent they have selected to represent them.

All the while they are educating themselves and getting a feel for the market.  The buyers are learning what their money can buy them.  How big? What condition? What amenities? Etc….  They may have a few to even well over a 100 homes under their belt with the internet and actual viewings. They have an idea of what the competition is offering compared to your home.

By the time they view your home many of the home buyers coming through will be very educated about the local real estate market. 

What’s it Mean When You Have Low or No Showing Activity?

No showings or low showings is actually feedback in itself from home buyers.  When you have low or no showings especially when you first market a home that is feedback from home buyer’s in itself.

Home buyers are telling you your home doesn’t come close to standing up to the competing homes on line.  They are telling you have missed the boat by at least 5-10% if not more.  

When you have a lack of or no showings the home buying public is telling you there are much better choices for us out in the marketplace.  Your home is not even piquing interest online.

What Home Buyer Feedback Questions do I ask?

These are the questions I send out for feedback to the showing agents.

  1. What Did Your Client Think of the Price? Broken down into multiple choice 5-10% overpriced or more, over priced, 3-5% overpriced, priced at or near market, great deal.
  2. What Did You as an Agent think of the price?  Broken down into multiple choice 5-10% overpriced or more, over priced, 3-5% overpriced, priced at or near market, great deal.
  3. What did your clients like about the house?
  4. What did your clients dislike about the house?
  5. As an agent do you have any suggestion to make the house more saleable?
  6. Any additional feedback would be welcome.

So I don’t really care what a client thinks about the price, many will just say it is over priced. 

What an agent thinks about the price is 50/50 for me.  I have been in the business for many years and know a lot of the local agents.  I care when certain agents I have a great relationship with give feedback on the price.  Others I don’t know, not so much.

What I really want to know is the answers to questions 3, 4, and 5 as well as any additional feedback.  This can be telling if there is something that a seller needs to address.

Final Thoughts on Home Buyer’s Feedback

Feedback can be a great tool for sellers to monitor and make adjustments to their home.  Your agent will have some insight into what the feedback means if it is not as straightforward as you would like. 

Where feedback is extremely valuable is when there is a pattern of the same negative feedback from a majority of the buyers.  It alerts you to a problem that needs to be addressed. 

Even if there is no pattern consider each negative comment.  Is it something that can be addressed easily?  If so do it. 

For example, there may be a seller I have asked to clean up and de-clutter their home, but they don’t take the time to do it because they don’t feel it is necessary.   Get a comment or two that the house is a mess and we are going to have a conversation. 

At the end of the day feedback will let you know if you need to make some changes or if your home is overpriced.  Pay close attention to the feedback it may just help get your house sold.

Other Resources About Home Buyer Feedback:

Reading Between the Lines of Your Home Buyer’s Feedback is provided by Kevin Vitali of EXIT Group One Real Estate of Tewksbury MA. If you would like to sell your home give me a call at 978-360-0422 and let’s get the process started.

Real Estate Services in the following areas: Northeast Massachusetts, Merrimack Valley, North Shore and Metrowest. Including the following communities and the surrounding area- Amesbury, Andover, Billerica, Burlington, Chelmsford, Dracut, Groveland, Haverhill, Lowell, Melrose, Merrimac, Methuen, Middleton, North Andover, North Reading, Reading, Stoneham, Tewksbury, Tyngsborough, Wakefield, Wilmington, Westford

5 Reasons Not To Hire a Family Member as Your Real Estate Agent

hiring a family member as your real estate agent

So I just arrived back at the office from a showing where I heard, I have a “family member who is a real estate agent” they will be handling the transactions. 

This article discusses five reasons why may not want to hire a family member as your real estate agent.

This woman spent a half an hour on the phone with me saying her and her husband are wanting to downsize their home and they don’t know where to start.  

I layed out the steps for her that made sense for their individual circumstances. 

She was so thankful that I was able to set her down a path to success.  There was one condominium she really wanted to see so I scheduled it…. short notice to boot.

We get there and she informs me that she has a family member that is a part-time real estate agent…. her nephew.  And he would be handling everything. 

She started asking me all these questions about buying and selling and she had specific questions about the unit she was looking at.  This was going to be a complex set of transactions and would require a seasoned real estate agent. 

I said listen you dragged me out here I might as well show you the unit but let your nephew need to earn his keep, you should have called him to show you the unit and he will be able to answer all your questions.

What was her response?

“Well he doesn’t really seem to know what he is doing, he doesn’t do a lot of real estate and he has a really busy job so he couldn’t show me the condo in the next few days.”

Ok, family member as an agent or not there is several red flags in that statement.  A good real estate agent should be able to fully educate you about the transaction ahead as well as be able to find time to show you a property in a reasonable amount of time.

If you are going to hire and inexperienced family member as a real estate agent, let me ask you this one question….

If this family member came to you and asked your for $10,000 or $20,000 would you give it to them?

Most of you will probably say no. 

Well, that is basically what you are doing when you hire a family member to sell your house.

They are going to potentially cost you thousands or even tens of thousands of dollars in the sale and purchase of a new home through there inexperience and lack of knowledge.

5 Reasons Not to Hire a Family Member as Your Real Estate Agent

 

5 reasons not to hire a family member as your real estate agent

Does that family member have the necessary experience to be your real estate agent? 

Experience matters…. big time.  I took me many real estate transactions and 3-5 years of working full time before I felt fully confident in counseling home sellers and home buyers. 

Having a real estate license does not automatically qualify you to be the right real estate agent for a particular transaction

Your relative may have a biased perspective

Is your family member actually familiar with the area you want to do business? 

Bringing in a family member who is a real estate agent from out of the area is just a bad idea.  They are not familiar with the local markets or even some of the specific neighborhoods.  Real estate is very regional. 

Not only are they not familiar with the local real estate market, but they could also limit the time they can give you if they are hours away.  In this hot real estate market getting into homes immediately si vital.

Is your family member a full-time real estate agent? 

This one is two fold.  One I already mentioned… experience. Helping a buyer or listing a home requires experience that is gained thru closing on 100’s of transactions. 

Two, do they have the time to properly service your selling or buying a home?  The real estate market right now is fast. 

If you are not in a good home in a day or two of it being listed, you will lose it.  Can that family member drop what they are doing to get you into a home?

Do you really want a family member knowing your business? 

There is a lot to a real estate transaction and many times real estate agents are involved in some of your close, personal information.  

There could be divorce, financial distress or other financial information involved that you may not want family members to know.

Are you willing to ruin relationships by using family as a real estate agent?

I had a really good friend always tell me… everybody gets funny about money. 

As I get older I realize how true that is. 

I have watched friends and family members get crazy about money, whether it is an inheritance or business matters or borrowed money. 

There is a lot at stake for you and your family member real estate agent could have thousands or tens of thousands of commissions at stake. 

What if it goes wrong?  Not only could you damage a relationship with that family member it could damage relationships with extended family members as well.

Final Thoughts on Hiring A Family Member as your Real Estate Agent

After reading this and you still want to hire a family member as your real estate agent, at least have them compete for your business. 

Interview at least two other agents and compare services, experience and track record.  In no way am I inferring your family member is not a good agent and as a matter of fact they could be a great agent.   

You should do your homework and hire the best agent for your real estate needs whether they are a relative or not.

Your family member at the end of the day may be the best real estate agent for you.  But hire your relative as your real estate agent because they are the best fit for you, not just because they have a real estate license.

Bottom line is you have too much at stake.  An inexperienced agent can cost you 10’s of thousands of dollars on the sale of your home and/or a purchase of a new home.

Remember, emotions run high during a real estate transaction.  A misunderstanding or expectations not met could but a damper on one or more family relationships. 

Boy, won’t Christmas at Aunt Mary’s be fun this year!!

As one final thought, the same goes for using a friend as your real estate agent for most of the same reasons.

Other real estate resources:

Your First Offer Is The Best Offer…. Fact or Fiction?

your first offer is always you rbest offerYou will often hear real estate agents say…. your first offer is your best offer. 

Now is this a cliche or is it fact?

As a real estate agent, I can tell you this statement is mostly true.  It is not just a cliche and I am going to go into why “your first offer is the best offer” is often correct.

All too often sellers will be very adamant when a listing first comes on the market. 

Activity is good and the home seller is feeling confident. 

Go back to when your agent gave you pricing on your home.  A real estate agent will give a range that a home is worth.  It is just human nature that a home seller only remembers the high side of the range and automatically lists at that price or even a little higher. 

In no way I am suggesting you should accept a low ball offer. 

But, it is important to review your comparable properties and carefully consider all offers. 

A skilled negotiator can many times turn a low ball offer into an acceptable offer. 

First Offer Is The Best Offer… Why is that?

As a home seller, you are most likely are like every other home seller and want top dollar for your home.  As you take the time to prepare your home and get it listed emotions run high. 

It’s stressful.  Y

our home is listed for two weeks, you have had a fair amount of showings. But, no offers.

Then your agent calls and says an offer is coming in! 

It gets sent over to you, but it is $20,000 less than your asking price.  Your heart drops.  You call your agent wanting to reject it outright. 

Then your agent says you should strongly consider countering the offer and follows up with the dreaded “your first offer is usually your best offer”. 

Ugh….. you want to ring your agents neck!  Why are they throwing out a cliché.  Don’t forget that offer is  often negotiated up.

Well it is not a cliché.  It is often true.  As agents, we see sellers reject good offers in the beginning because the seller thinks they can get more.  Then we watch as the house sits on the market and even lower offers come in or price changes are required below the original offer. 

Now it becomes a game of trying to chase the offer you lost!

Let Me Explain Why

There is some actual substance behind “your best offer is often your best offer” it is not just a cliché. I’ll explain. 

There is a pattern we see all the time in either showing activity or online activity of a home as seen in the graph below.

And, these are things that I track for my clients.

Showing activity will usually peak in the first 1-3 weeks a home is on the market.  After that we will often see the activity drop like a lead weight.  Then showings become more and more spotty as time goes on.

After 90 days on the market, you are lucky to see a few showings a month.

This is also the same reason why it is important to sell your home in the first 30 days that you are on the market. 

Buyer Psychology

Let’s get inside the home buyer’s head for a minute.  There is a process many home buyer’s go thru to get to the point of making and negotiating an offer that is acceptable to the home seller as I previously explained. 

Most people in general have a pack mentality, including home buyers.  If others want what they want it validates their decision or desire.  Look at how prevalent name brands are… Polo, Mercedes, Rolex, Coach, etc…  But they are popular and it is human nature to want to belong and be a part of what others are doing. 

Look at the stock market.  So much of the market is people following what others are doing.  It becomes follow the leader.  So much so, that sound principals can be thrown out the window….. if they are wanting or buying it, I should to!

Most home buyers want what other home buyers want.  If they see activity it validates they have picked a good property.  Back to back showings, simultaneous showings, packed open houses, new to the market…. all create an urgency to make a decision and step up and get the home.  This creates competition among buyers.

Alternately, if your home does not sell buyers become suspect. What goes thru their mind is what is wrong with it, why don’t other people want it.

The Home Buyer Cycle

The reason agents see this pattern over and over again is because of the cylce a home buyer goes thru on their search for the perfect home.  A home buyer gets the thought to buy.  They do some homework and get a mortgage pre-approval…. then call an agent and pick out a ton of homes in their price range. 

First Phase of the Home Buying Cycle- Market Testers

Home buyers get the thought to buy.  They spend hours looking for home on the computer.  They will start hitting some open houses and maybe schedule a showing or two with an agent.

Second Phase of the Home Buying Cycle- Just Starting Their Search

They have met with an agent.  They realize they need to get a mortgage pre-approval if they are serious buyers. Time to get serious.  At this point, the inventory they are looking at is the same inventory that has been around for weeks or even months.  It is the old tired inventory other buyers did not immediately snatch up.

How many times do you see feedback from agents saying the buyer just started their search they are not ready to make the decision on any home?  Quite a bit.  But buyers have to start somewhere.

Third Phase of the Home Buying Cycle- Learning The Market

They are nearing the end of all of the inventory that was left by other uninterested buyers. 

Third phase buyers now realize that they need to pay closer attention to the new homes that just came on the market. Good houses in any real estate market go quick!

Realities of the market place or starting to creep up on home sellers at this point.  Missing homes because they did schedule a showing quick enough, losing homes because they have underbid, taking to long to decide to put in an offer and the home is already under contract, maybe a lost home or two over home inspection, passing on homes they thought were overpriced but were snatched up immediately…..

Third phase buyers are learning hard lessons in the marketplace.  One fact that every home buyer needs to learn no matter how experienced they are is the internet has sped up the buying pace. 

Even in slower markets the good homes…. priced at market, in great condition and in good locations are gone in the bat of an eye.  While market times are far lower than we have ever seen, part of it is the market itself but part of it is also the internet and putting homes in buyer hands the minute they are listed.

Fourth Phase of The Home Buying Cycle- Ready to Buy

Your fourth phase buyers are your best buyers.  Showings of your home in the first few weeks will be made up mostly of fourth phase buyers. 

Fourth phase buyers know they need to get into good homes right away.  They have rejected all of the previous inventory and are waiting for the next good house to come on the market.

They have been fully educated about the market and market value of homes and are tired.  They are ready to buy.  The fourth phase buyer will step up and do what they need to do to get the home they want.

 

Why you should sell your home quickly, your first offer is your best offer

What Happens When Your Home Sits on the Market Unsold

If you miss that critical 20-30 days on the market.  You will see showings start to drop off.  Waning off to almost nothing after 60-90 days.  The phone will ring, you’ll get an appointment.  But., more often than not they are home buyers just entering the market.  They need to cycle thru the phases before they are truly ready to step up and buy.

As a home sits on the market, buyers will see the days on market and ask whats wrong with the home?  Excessive days on market make buyers wonder why has this home been rejected by previous buyers. 

Buyers are far more willing to submit low ball offers and have ridiculous home inspection requests when a home has sat on the market for 60-90 or even 120 days. 

There is also a certain segment of the home buying market that wants to find a home that has been sitting around.  These feel they can get a better deal because they don’t have to usually contend with multiple offers.

One Caveat To Your First Offer Is Your Best Offer

One thing that is needed for the first offer being your best offer is market time.  You dont need much market time in the day of internet marketing, but you need 4 or 5 days of marketing time for the majority of buyers for your home to know it is available.

To accept a lower offer on your first day of your home hitting the market may not be prudent.  You should review the comparable from your Compartaive Market Analysis and discuss with your agent if it is wise to accept an offer significantly below your asking price.

Once your home hits 4 to 7 days on the market, most of the true buyers from your home will be aware it is on the market.

Final Thoughts on Your First Offer is The Best Offer

While this is a bit of a generalization it is often how the buying cycle goes.  There is a reason why your first offer may be your best offer. 

I also don’t want home sellers to think I am telling them to take the first offer unilaterally. 

This is a discussion to have with your real estate agent and it is time to review comparable properties again and discuss the health of the real estate market.  Don’t dig in your heels over a few thousand dollars if that is what it comes to early on in the process.   These first home buyers are likely to put in the best offers on your home. 

If you have high buyer interest in the first week this is also when multiple offers can occur.  As a home seller, if you get multiple offers this is the best situation to be in.

This is why you will often hear agents say “your first offer is usually your best offer”.  It is critical to sell your house early in the process to obtain the best price for your home.  Agents know the cycle and they know how a majority of home buyers operate.

Other Real Estate Resources:

This article about Your First Offer Is The Best Offer…. Fact or Fiction? is written by Kevin Vitali of EXIT Realty. Need help buying or selling a home? Give me a call at 978-360-0422 or email me at kevin@kevinvitali.com

Real Estate Services in the following areas: Northeast Massachusetts, Merrimack Valley, North Shore and Metrowest. Including the following communities and the surrounding area- Amesbury, Andover, Billerica, Burlington, Chelmsford, Dracut, Groveland, Haverhill, Lowell, Melrose, Merrimac, Methuen, Middleton, North Andover, North Reading, Reading, Stoneham, Tewksbury, Tyngsborough, Wakefield, Wilmington, Westford

CONTACT ME

Kevin Vitali- Massachusetts Realtor Serving Essex County and Northern Middlesex County Massachusetts

KEVIN VITALI

978-360-0422
kevin@kevinvitali.com

Kevin Vitali- Massachusetts REALTOR
Real Broker MA, LLC
90 Canal Street
Boston, MA 02114
cell phone: (978) 360-0422
office phone: (855) 450-0442

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Massachusetts Real Estate

 

Real Estate Services in the following areas:
Northeast Massachusetts, Merrimack Valley, North Shore and Metrowest including the following communities and the surrounding area including
Amesbury, Andover, Billerica, Burlington, Chelmsford, Dracut. Georgetown, Groveland, Haverhill, Lawrence, Littleton, Lowell, Melrose, Merrimac, Methuen, Middleton, Newbury, Newburyport, North Andover, North Reading, Reading, Salisbury, Stoneham, Tewksbury, Tyngsborough, Wakefield, West Newbury, Westford

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No information on this website is to be construed as legal advice.  The information is either generalized or state-specific. If you are seeking information for legal purposes please consult an attorney.