Houses can sell in any market, but it seems like no matter what market we are in, some homes just sit there until they expire. If that is happened to you, reading these reasons may help you find out why:
1. Finance terms.
If a buyer offers a lot more than the current market value of the property, their lender will refuse to give them a loan, even if they have already been prequalified for that amount. The property is the collateral for the loan and lenders require that collateral to be equal to their investment. Let us hypothetically say that you are a small time lender. Would you loan $1,000 and take a ring as collateral that was appraised at only $800? If they should stop paying, you only get a ring worth $800 and then you have to sell it yourself to get 80% of your money back. Whenever an offer gets accepted and a home goes into escrow, the lender will send an appraiser out to the property. If the appraiser says the house is worth less than the loan amount and down payment combined, they will refuse to provide funds. These deals have to be renegotiated for a lower price, or will fall out of escrow.
2. The price is too high
. This is by far the most common reason a property does not sell. A common truism heard often in the real estate business is, "a house is only worth what buyers are willing to pay." Highly overpriced houses tend to sit on the market until their expiration date. It is true that if a seller has taken good care of their home and fixed it up, it will sell for more than neighboring houses, but not if the price is inflated well above market value. For example: If there were 10 houses selling in an area that all looked similar, but were priced between $190,000-$260,000, all of the lower priced houses would sell, while the most expensive listings would remain on the market. Waiting for the other 8 or 9 houses to sell first so your house will be the next also does not work. There are always new listings coming on the market and if your price is still too high, those new listings will be sold and your over priced house will be passed by. Many home owners have invested years of time, care, and made improvements to their homes and believe it is worth more than the surrounding homes, and maybe it is. An experienced agent can assist finding the right price for a well loved home. The main thing to keep in mind is that when buyers go look at a house, they usually think of two things: 1. How nice it will be for them to live in it, and 2. Can they negotiate a good deal on it.
3. Lazy agents.
One of the simplest and most important things an agent can do is take pictures of the house when they take the listing. In fact, the more pictures the agent takes, the better. Surprisingly, some agents do not even take one photo of the front of the house to put in the MLS. These same agents are also notorious for not filling out much information in the marketing remarks for buyers and other agents to see. There is nothing more unappealing than a listing with no photo and only one sentence of information about the house. If the agent does not take the time to do the simplest tasks, imagine how much effort they will put into the rest of the selling process. Always ask for a print out of the listing your agent creates, so you can make sure it meets your standards.
4. Inexperienced agents.
New agents have some advantages. They can be very motivated and excited to sell a house. However, agents have to know how to price a house right, do open houses, market a property in the right places and to the right people, negotiate with buyer agents, and fill out agreements correctly for in the best interest of the client. Experienced agents usually have buyers they are in contact with who may want to buy your house right away. They know where to advertise, how to stage a property for showing, have experience negotiating the terms of the sale on the behalf of the seller, and much more.
5. Hiring A friend to be your agent.
Many people know someone who has their real estate license, but do not use it unless they happen to trip over a transaction. Selling a house takes experience. Find out if your friend has done both listings and sales before. Having a familiarity with all aspects of the real estate business can make a huge difference in how easily a house will sell. Some home owners give the listings to their friends because they want to do them a favor, but unless you have a friend with a knack for selling, you may be better of working with an experienced agent.
6. Refusing to show the property.
Houses are harder to sell when potential buyers cannot get in to see them. On the other hand, sellers who go out of their way to arrange appointments are much likelier to end up in escrow. If a home owner cannot be available to open up the house during the day, it is a good idea to keep a lock box on the door, so agents can show the property at any time. In addition, sometimes renters are living in the property and will not let anyone in to see the house. It may be worth talking with the renters and trying to come to an agreement where the house can get shown.
Some cleaning, decorating, and basic steps to fix your house up with little or no cost can make it sell better. Rearranging furniture, strategically placing vases, cleaning windows and such are all great ways to capture a buyer's interest. Keeping the front yard manicured will create some great curb appeal, which is of course the first thing buyers notice when seeing your property. Some agents take great pictures of houses, but if the buyers drive up to the house and do not like the way the house looks outside, they will sometimes just drive away to the next house on the list.
8. Fast expiration date.
Putting a house on the market for less than a month is unrealistic, unless the market is a good market for sellers, or you price your house under market value. Most listing agents prefer to list homes for 90 days, or more in certain cases. When an agent takes a listing, they begin the process of putting it in the Multiple Listing Service, advertising it, telling other agents about it, and start making calls to buyers. Usually at least a few different people will want to see the property before someone buys. The process that transforms a listing into an escrow will usually take more than a month. If you want your home to sell faster than that, the best solution is to list the house low for a quick sale and use a good agent.
9. Low motivation.
People who are not motivated to sell their home are often having second thoughts, or may not have plans to move until later, but want to get a buyer lined up early, However, there is a lot of time an effort goes into marketing a property for buyers and if the seller is not ready, he/she will lose the buyer completely. These sellers may decide to hang onto the house in the end because they were never sure what they wanted to do in the first place. Consider the positives and negatives of selling your home and make sure you are doing it for the right reasons. If you still are not sure, maybe you should wait a little longer until you feel confident that you are ready.
10. Unwillingness to negotiate.
Some sellers are very firm on their price, while buyers are hoping to negotiate. Occasionally when that happens, the seller refuses to even look at the offer. However, it is always better to negotiate. If you are not willing to come down in price, counter offer the original sales price and see what the buyer does. Maybe the buyer does not want to spend that much for a property, but may be willing to do some creative financing, such as offer you their boat, rv, or something of worth to trade in place for the difference. You never know, you may be end up very happy with the end result of a negotiation that would have otherwise been disregarded.
For more information on Antelope Valley real estate, call Susan at 661-305-0385, or visit our blog