Selling a home will be the biggest transaction most of you will make in a lifetime. It can be a confusing and stressful process, particularly if you haven’t carefully considered all the steps.
That’s why it’s so important to do as much research as you can, says David Ginnane, CEO of Agent Select, an online agent comparison platform that identifies top-performing agents in your area.
“On average, people in Australia sell every 10 to 12 years, although for many it is a lot longer than that – up to 25 years,” says Mr Ginnane. “But, interestingly, most of us will spend more time researching what flat-screen TV to buy than the best agent to sell our home.”
Selling your home shouldn’t be a rush decision, says Darren Turner, general manager of RACV Home. “It’s important to take your time and get yourself organised for the sale, whether that’s in the upkeep of the property or picking the appropriate agent,” he says.
Here are the biggest mistakes people make when selling a home, and how to avoid them.
Signing the wrong agent
Choosing a real estate agent shouldn’t be a simple matter of going with the bloke who sold your neighbour’s house. Whether you do your own research into local sales, auction clearance rates and approach agents for a quote, or if you use a free service such as Agent Select, you should consider an agent’s sales record, commission rates, marketing costs and, importantly, how comfortable you are with them.
“The lowest commission doesn’t win the job – what wins the job is trust,” says Mr Ginnane.
“It’s important to choose someone who has a strong track record in your area and with similar properties, but also someone you feel comfortable with.”
Undervaluing or overpricing your home
There are few things more disappointing than a home that won’t sell because it is too expensive – unless, of course, it’s the feeling that you gave the property away too cheaply. It’s important to put in the work to estimate a price that fits the market and your expectations, before discussing it with your agent.
“Ten to 15 years ago the agent would be the sole source of information for people about pricing but now it is almost totally the opposite,” says Mr Ginnane.
These days there’s a multitude of online resources including Agent Select, Landchecker (an online portal that details the sales history and other detailed information for thousands of properties in Victoria and New South Wales), Core Logic and the big property listings sites.
“These can be used to access localised, specialised information about comparable sales, median price information, the rental vacancy rate, down to transport and schools,” he says.
A combination of your research, the agent’s recommendations and your financial needs should settle on a price range that will keep everyone happy – and keep buyers coming.
Overcapitalising on renovations
Thinking of putting in a pool before sale? Hold that thought, says Mr Turner. Overspending on major capital works may not get the return you’re looking for. Take the time to research similar property sales in your area, their features and selling price to determine how much you think you can invest.
“Looking at a modest home renovation could add real dollars to the return at sale – the caution with that is ensuring you don’t over-capitalise,” he says.
“You just want your main areas to be presented the best they can and have a bit of wow factor. Certainly, kitchens and high foot-traffic areas like bathrooms, they are the ones that potential buyers will look at.”
While investing in substantial renovations before a sale may be unwise, it’s worth setting aside a modest budget to help make the home appear neat and tidy. It might be hiring a gardener to trim unruly bushes and plant shrubs in the front garden, painting the interior or even putting some of your furniture in storage and renting more modern pieces. Hiring an independent expert from a professional property staging business can help.
“We can get caught up in living in that property and potentially don’t see some of the things that might need addressing around the home,” says Mr Turner.
“That might mean the carpets need to be well cleaned, all the floors presentable, the gardens put in a really good sort of order.”
If it’s an investment property you’re selling and there’s an existing tenant, you’ll need to make a judgement call about whether the property is neat enough to open up for inspections or if you should wait until it’s vacant before putting it on the market.
Getting the timing wrong
Choosing a peak school holiday period to sell your home (or Grand Final Day for your auction) could see a dip in attendees at open for inspections and auction day, so carefully consider your sale period. But take note, as the old adage that spring is the best time to sell isn’t necessarily true.
“What happens in spring is usually there is an influx of new listings and the laws of supply and demand then take over,” says Mr Ginnane.
“You get the situation where there’s a finite number of buyers and an increased number of listings, which could inadvertently put a dampening on the prices you’ll achieve.”
He says that over winter, when there were fewer houses coming up for sale, agents were bending over backwards to do deals to get listings.
An off-market listing with an agent, a low-cost tactic where an agent emails details of the property directly to potential buyers on their database, may also be worth a try. It’s a good way to gauge interest in the property without the expense of a regular advertising campaign.
Also, carefully consider whether your home is best suited to a short, sharp sales period with an auction or if it’s more of a slow-burn private sale. You don’t want to waste money on an auction if interest is too slow and you end up putting it back on the market anyway.
Metropolitan properties are often quick sellers so would best suit an auction, whereas regional properties with lower levels of interest might be best as private sales – but Mr Ginnane recommends looking at the stats.
“One of the key indicators is average days on market in a particular area,” he says.
“If your suburb is 20 to 25 days, you know there is some pretty competitive activity so an auction would be the go. Alternatively, if you had a suburb or town that was 70 to 90 days average on market, you would be at risk of blowing that money if an auction is passed in, so we might be better off having a private sale without a price range and an ad that says ‘contact agent’ or ‘price on application’.”
Going overboard on marketing
It can be really easy to splurge on advertising your property far and wide to lure potential buyers, but this is a real ‘seller beware’ issue. It’s important to know your target market, where they source their information and then be strategic, not scattergun, about where you advertise. Digital platforms such as domain.com.au, realestateview.com.au and realestate.com.au make it easy to search for properties and are relatively inexpensive compared to print.
“As a general rule, we encourage our customers to initially go with digital only,” says Mr Ginnane.
“There would need to be a compelling case to go to print, unless you are in a premium $2 million-plus property or in a regional area.”
Also, consider if your ideal buyer is overseas and, if so, advertising in international publications or sites might be appropriate.
Trying to do the legal stuff yourself
Unless you have legal training, you shouldn’t even think about trying to go it alone when reviewing your contract with your agent and navigating the paperwork of the sale agreement and settlement of your home. According to Mr Ginnane, DIY conveyancing is one of the biggest mistakes sellers can make.
“Get independent legal advice, to support you through that selling process,” he says.
“Having someone who can review the contract terms and ensure both the sellers’ and purchasers’ obligations are very clear to each party is really important.”
Conveyancing.com.au provides professional legal advice for both buyers and sellers, including a free 20-minute phone consultation.
Don’t forget, if there is any outstanding mortgage on the property, make sure you have informed your financial institution about the sale.
Edited with permission from www.racv.com.au
Have you ever sold your home? What was your secret to success? Where do you think you could have improved? Why not share your tips with our members in the comments section below?
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