Sell with Oak Realty

What would an upward or lower price adjustment look like based on the current market CMA? Well, let’s look at an example. Let’s say that the CMA of previously and recently sold similar homes shows that the listing price should be around $235,000. However, those sales were between one month and three months old. Our current market listing CMA shows that similar homes in the neighborhood are listed at $249,000 or thereabouts. Me and you may decide that the market is improving and justifies raising the listing price of your home to $245,000 so that it’s still competitive but a better deal for you. Of course, this can work the other way as well.

A proper list price that reflects current and realistic market conditions is critical to getting your property sold quickly. We don’t want you to under–price, but it’s worse to over–price in any market. Buyers discount value by DOM, Days On Market. The longer a home stays on the market, the greater they’ll discount their offers. So, a realistic list price is how we make sure your property sells without languishing on the market.

How do we come up with a suggested list price that reflects your home’s competitive position? It’s a combination of services and experience, and I'm going to be very careful and detailed in my analysis and market evaluations to make sure that you don’t leave money on the table or sit around wondering why you aren’t getting offers.

Our evaluation of how your property compares to the current competition is the first step. Then we may suggest some worthwhile corrections you can make to improve that position. Once we know what your home will look like when listed, we’ll go into our thorough CMA, Comparative Market Analysis, process.

CMA of Sold Properties
First we select comparable properties out of those sold recently and in the neighborhood or nearby. These “comparables” or “comps” are selected based on similarity in features, location and characteristics with your home. They must have been sold as recently as possible so the sold prices are of maximum value.

We then do a through “adjustment” process to adjust their sold prices for any differences with your property. If a home has one more bedroom than yours, I would adjust that property’s sold price downward for the value of one bedroom to make the comparison “apples to apples.” We make adjustments for garages, bathrooms and other major features to bring our comps to closely compare with your home. Then we use those sold prices to arrive at a preliminary listing price for your home.

We say “preliminary” because I have another CMA step.

CMA of Current Listings
Now we get more comps, but instead they’re properties currently listed and your competition. We go through the same adjustment process, and we come up with another, possibly higher or lower, price suggestion for your home. This second CMA gives me more up–to–date information about the market which could cause us to lower or raise our preliminary list price to adjust to the current market. Using the two CMA results and an experienced analysis of your home’s position in the marketplace, we can set a listing price that will get the job done.

All buyers want to pay as little as possible for the home they purchase. Buyers in slower markets are definitely looking to score a bargain. My job is to combine services to my sellers that include marketing to improve the competitive position of their homes, and then to assist them in countering low offers and buyer resistance to fair pricing.

Part of this process begins with the CMAs we do and the price at which we suggest that you list your home. Starting at the right price for the market with a little room for negotiation combines market specifics with buyer human nature factors. We're really good at this negotiation thing, as we do it every day. We're on your side, and our job is to get a combination of the best price and contingencies resolutions for your home.

Many sellers are intimidated when there are distressed properties for sale in the area or foreclosures putting downward pressure on prices. However, generally there is a 20% to 30% difference in selling prices between those homes and seller-occupied homes in good condition. You see, those distressed properties are usually in poor-to-terrible condition. In many cases, they will not even qualify for a mortgage without extensive modifications and repairs, and that’s not going to be possible for most buyers.

So, the first thing to remember is that you’re selling a “ready to move in” property, and this commands a higher price. The more “ready to move in” it appears to the buyer on that first walk-through, the better the price you’re going to get. So, we’ll make some suggestions as to landscaping, curb appeal, outdoor and indoor improvements, and possibly even “staging.” Staging is the process of moving, adding to or taking away from furnishings in the home to make it seem more spacious and to allow potential buyers to view it as “their home” in the future.

Consider the possibility of post-inspection repair requirements by the buyer(s) as well. The time to think about this is from the first offer, as you don’t want to negotiate a purchase price that leaves you little or no room for possible repairs or condition corrections. This single item is the cause for the vast majority of deal failures after a successful initial price negotiation.

Some negotiations are short and sweet, while others can involve multiple counter offers with terms and conditions related not only to price, but also related to closing costs, items included in the sale, partial owner financing and more. Our job is to work with our sellers to know their needs and to tailor the negotiation to those requirements to get the best deal for them.

While our sellers tend to become less stressed as soon as all of the purchase contract signatures are in place, we are with them and ready for the next negotiation phase. Property inspections can frequently result in buyer requirements for corrections by the seller. Whether you’re prepared for these or they come as a surprise, we're here to help you to deal with them, as repair disputes are the most frequent reason for contract failures before closing.

Part of our job is to help you to avoid too many “surprises” related to condition and repair negotiations after inspections. We'll do our best to give you information about what we see that buyers may want corrected, but there are definitely things that nobody can anticipate until the inspectors have submitted their reports. So, there’s one other thing we try to do in order to prepare you and leave some negotiation room for you.

We want you to always be thinking ahead to inspections and repair demands from the first offer. Always be thinking of what may be coming in the way of inspections and repair negotiations, especially when the initial purchase contract price negotiations are in play. No matter how urgent your need to sell, if you go too far in price concessions at the beginning, you may have no room left when inspections are done and condition corrections are requested by the buyer.

As the buyer is normally paying for and ordering inspections, our job for our sellers is to make sure that they happen on time and that I receive the inspection reports by deadline due dates. We then meet with my sellers and go over the reports and any buyer objections/requirements to develop a counter strategy. If there are no objections or they’re minor in nature and cost, you may opt to agree to corrections. However, if they’re more extensive and were not anticipated, our job is to help you to reply in a way that saves you money and keeps the buyer in the transaction.

Depending on the desires of the buyer and their selection of inspectors, there could be as few as a single inspector hired to do a thorough inspection of the home and all equipment supporting the home. However, there may also be other inspectors hired with a more focused goal, possibly a heating and air conditioning contractor, a well inspector, septic inspector, etc. Each of these inspections will have deadlines for completion and submission of reports and buyer requests for corrections.

We have our own list of inspectors and contractors, and can call in experts to provide cost estimates and help our sellers to make decisions within the deadline times. Unless you have multiple offers, a buyer in the hand is worth something. Our job is to get them to the closing table and your satisfaction with your net proceeds from the sale.

Our seller clients really appreciate our services in listing, marketing and getting a buyer signed on the dotted line on a purchase contract. However, neither they nor we can rest just because a contract is inked. There are more than 50 tasks and deadline deliveries on my normal residential seller side real estate transaction checklist. And, we take our responsibilities seriously in the processing of all documents and meeting of all deadlines.

The process of taking a signed purchase contract through to closing involves a great many details, deliveries and document submissions. We coordinate all of this for our sellers, making sure that all phases of the closing process move along smoothly.

1. Title – We work closely with the title company and attorneys to make sure that all documents and deliveries are processed in a timely manner. We work with our sellers to examine all of their title and recorded documents to uncover all material defects and items of importance. Though this is normally of more concern to the buyer, sellers must respond to their objections, so it’s important to know what’s in all recorded documents.

2. Inspections, Survey & Appraisal – Our job is to coordinate access for inspectors and the appraiser, and to accept deliveries of reports as well as any objections or correction requirements from the buyers. We take this job seriously and will be with our sellers every step of the way. Every instance of delivery of an inspection and/or buyer objections requires a response in most cases, and there are deadlines. We stay on top of these deadlines, make sure reports are delivered to you on time or extensions are put into place, and that you respond within required time lines. Failure to do so could obligate you to repairs or other corrections or kill the deal.

3. Repair Negotiations – If the buyer submits requirements for corrective actions to items on reports, we work with our sellers to determine the cost of those requirements and the appropriate response necessary to keep the deal going in a way beneficial to my seller clients. Should you agree to make certain repairs, there will be deadlines associated with completion, and possibly requirements for the buyer’s inspector to return and re-inspect for completion and repair quality. We keep all of this on track for you, and can recommend contractors we know do quality work at fair prices.

4. Lender Document Coordination – One of the leading causes of delayed closings is some problem with funding due to lender last minute requirements or other document demands. We are monitoring all document flows to make sure this doesn’t happen for my sellers. As the seller, you aren’t getting a mortgage, but you need to be very concerned with the buyer’s ability to do so and their lender’s process and ability to meet deadlines and fund at closing. Mortgage problems kill a lot of deals, so we’re going to be involved in the buyer’s process to protect you, our seller client.