How to Sell Your Home in a Bad Market
If the number of properties on the market far exceeds the number of potential homeowners available to purchase them, you're facing a buyer's market. Even if you can't wait the market out and have no choice but to sell immediately, your situation isn't necessarily hopeless. Your home is probably still salable if you employ a little creativity and ingenuity. You must convince buyers that your house is better than all the rest and that they should prefer it to anything else they've seen.
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Instructions
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Compare your home to others on the market, in neighborhoods similar to yours. Be honest with yourself and realistic about your appraisal of the other properties. Your home is probably not worth much more than others with similar square footage and amenities. Their listing prices reflect what the market will bear. Plan on listing your home in a similar or slightly lower price range to be competitive.
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Interview a number of real estate agents before you sign with one. Find out what each agent thinks your home should sell for. An agent who comes in much higher than you know your home is worth might just be scrambling for a listing --- the bad market is probably affecting her income as well. She might tell you anything you want to hear to get you to sign with her. If a real estate agent comes in significantly lower than you expected, find out why. You might have missed something when you investigated similar homes.
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Invest in your home before you list it for sale to make it as attractive as possible. Call a contractor to repair the banister in the foyer, for example, or to retile the kitchen floor if it's seen better days. You probably won't be able to pad the expense onto your asking price, but if you have to purchase furniture, you can take that with you when you go. If you don't want to repaint the exterior, at least have it powerwashed so it shines like new in the sun.
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Gather up as many of your personal possessions as possible and move them to another location. "Money Talks News" suggests that you want your property to look welcoming and homey but not like someone else already lives there. Help potential buyers envision living there themselves.
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Make your home more affordable than any other on the market. After you've spiffed it up and priced it competitively and realistically, consider what else you can do to make it easier for someone to buy it. This might include paying closing costs on behalf of the buyer or accepting less of a down payment. CNN Money suggests offering to pay for a home warranty policy so your buyer doesn't have to worry about unexpected repair costs in the first year.
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Tips & Warnings
You might be tempted to skip the services of a real estate agent and try to sell your home yourself. Although this may save you a commission --- and the savings might be particularly attractive if you're selling your home for less than you'd like --- you might need professional help to move it in a bad market.
REALTOR is a registered trademark of the NATIONAL ASSOCIATION OF REALTORS.
Even if you find a buyer at a list price higher than fair market value there is a chance that the buyer's lender will not appraise for the amount you are asking placing the entire transaction at risk. Ask a REALTOR how to avoid issues with appraisal.
The advice above is written based on NJ Real Estate markets and some points may not be applicable to your situation.
This article assumes you do not owe more on your home than it is worth and that you are not in default with your lender. In such cases a short sale may be required and this procedure requires a more complicated approach to selling.
References
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