How to Compete With Foreclosures When Selling Your Home
You’ve probably heard a lot about foreclosures and short sales over the last couple of years. Lots of advice has been handed out to those who need to sell in a distressed situation. But what if you are not behind on your mortgage payments, but for one reason or another it’s time for you to sell your home? How do you compete with the flood of bank-owned properties on the market?
Chances are there is a home for sale near you that is bank-owned which is affecting the value of your home. And depending on where you live, it may even be that most of the recently sold properties in the area came from distressed sales. If that’s the case you have a problem. If you want to sell your home you need to learn how to compete with the pricing of those foreclosures and short sales.
Do not get too discouraged. Remember that since your home is a straightforward sale, you have distinct advantages over distressed sales. Here are two key things to remember:
Position Yourself Properly With Marketing
How does a company like Nordstrom stay in business when competing with places like Walmart or Target? The answer is simple; they have a different target market. They market a different quality of product to a different group of buyers. The same principle can be used in real estate. Distressed properties generally draw in buyers who aren’t concerned about the home's condition; those people are called investors or rehabbers. These buyers aren’t interested in living in the property; they will simply fix everything with the intention of reselling it later.
But if you’re interested in attracting a high quality homebuyer you must offer a high quality product. Most buyers are shocked when they realize the condition of the majority of the foreclosed properties on the market. Abandoned homes often come with critical problems like ripped out plumbing, water damage, mold, broken windows, busted walls, and much more. It isn’t hard to compete with conditions like that. You have a distinct advantage if you are selling a home that is livable. Home buyers feel more comfortable when they know something about the person(s) from whom they are purchasing a property. Buyers have more confidence that there will be no title issues when they are purchasing from a long-term owner who is in good standing with their lender.
Make sure your home is clean, fresh, de-cluttered, light and bright, neutral, and all the necessary updates have been made to the walls, flooring and kitchen/bathroom fixtures. Making these improvements won’t increase the price you get, but it will help you sell for what your home is really worth.
Select the Best Real Estate Agent for Your Needs
Not all real estate agents are created equal. It has never been more important to list your home with a qualified and experienced real estate agent. A good agent will know how to navigate through the rough waters of the current real estate market. You should interview several agents and make sure that the person you select has an understanding and appreciation for the selling points of your home.
Be willing to accept hard-to-hear advice and remember that everything is negotiable – including the listing agent’s commission. There are agents who are willing to reduce or even eliminate their listing commission as a way to help you lower your asking price to a level that is on par with the prices of the distressed sales in the area. Do not be afraid to ask for such an arrangement with your agent.
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