In this week's article I wanted to discuss a few topics that seem to either be misunderstood by many or are common in other states or countries. While some of these topics likely vary from state to state, for our purposes we will be discussing these regarding Oregon-specific practices. So, while your uncle in another state may suggest something that they have done themselves, it may be state specific and either not common or not allowed at all.
Setting a high list price
One of the first "myths" I would like to discuss is setting the list price above comparable sales, so that you have some room to negotiate, or in the hopes that "it only takes one buyer(s) to really like it." The reality is that homes that are overpriced don't get as many showings, so they sit for longer periods of time, forcing the seller to reduce their price anyway, while also leading to below-market offers due to the number of days the home was listed for sale. When putting a property up for sale you want to have as many showings as possible as early in the process to create some urgency for buyers. After a few weeks of being on the market the likelihood of a full-priced offer is very, very low. Many agents, myself included, will review homes with buyers that have sat on the market for 45 to 60 days, looking for opportunities to "get a deal" or "lowballing" a home that has been sitting on the market without offers.
Foregoing the buyer's agent
The next misconception I have come across is folks thinking if they forego their own buyer's agent, they can get a "discount" off the purchase price. The logic behind this fallacy makes sense, which is why it seems to be somewhat common. However, it is hardly true. The reality is that any home that is listed for sale by a broker has a listing agreement to go with it. This agreement lays out the terms of the contract (which can vary) but typically the seller signs a contract that stipulates the listing brokerage is to be paid a percentage of the sale price, which is then split with the buyer's agent's brokerage. The point of this is that going without an agent does not change the terms of the seller's listing agreement! I am not implying that one cannot purchase a home/property without a buyer's agent, but unless you are very proficient in the timelines, nuances and negotiations involved in a transaction, it is likely best left to a professional.
The myth of the turnkey home
Contrary to popular belief your home does not need to be turnkey to sell, but it needs to be neat and tidy. There are plenty of buyers out there looking to put their own sweat equity into a property and truly make it their own. Oftentimes it doesn't make financial sense for a seller to replace the flooring or repaint the interior of a home as the new buyers have their own plans anyway. If the property needs some updates, the biggest things you can do at very little cost are to, first, have the place be clean. Hire a professional if needed, but cleanliness goes a long way. The next major factor is price. If the place needs some updates, that needs to be factored into the list price to be as attractive as possible.
Hopefully this helped clear some things up for those of you in our community. Like always, feel free to reach out to me with your real-estate-related questions and I will do my best to answer them! [email protected].
