Tip 1: Identify three experienced agents who are familiar with your neighborhood. Look for agents who have “for sale” signs placed in your neighborhood. Ask each to prepare a market analysis (how much is it worth?) and a marketing plan (how do you plan to market my home?). Ask lots of questions about both. Include the main points of your marketing plan in your listing agreement so that all parties will know what is to be expected (i.e. frequency of ads and the publications/websites where they’ll appear, frequency of open houses, etc.). Limit the length of the listing—two months or less is good, but no more than three months. If the agent is doing his/her job as set out in the listing agreement you can always renew the listing when it expires. If they’re not producing results you’ll be able to document the reasons if you decide to cancel the listing early or be able to show them why you aren’t renewing the listing with them.
Tip 2: Price your property realistically, especially in slow markets. When markets are slow buyers are psychologically unprepared to overpay—and they apply stringent standards of value. They will heavily discount many expensive and unusual improvements unless they appeal very strongly to their own personal tastes.
Tip 3: Consider providing owner financing if you can, but be cautious. If you can provide some financing, even if it’s a small second trust, you may be offering ‘the’ deal maker. At the same time you can often earn a considerably higher interest rate than you would have earned with the same money otherwise. Caution: Fluctuating real estate markets can wipe out your security in the event of foreclosure. Foreclosures cost money and a second trust only gets paid after the first mortgage is satisfied, and then only if there’s money remaining from the sale. Make sure to run a credit check on the buyer and make sure that they put up a substantial down payment if you’re providing owner financing.
Tip 4: Make sure you don’t prematurely give away any bargaining leverage. All home purchase agreements must be in writing to be binding. If someone asks if you would take a specific lower figure and you agree, that’s not an enforceable contract. All you have done is to lower your asking price. The correct response should be “I’ll consider all written offers.”
Courtesy of the American Homeowners Foundation and the American Homeowners Grassroots Alliance, www.AmericanHomeowners