5 Questions Property Sellers Need To Ask Themselves Before Calling An Estate Agent
Category Buying and Selling Property
Just as buyers need to do their research before taking on homeownership, property sellers should also spend some time contemplating certain aspects before they call an estate agent to list and start marketing their property for sale.
Every person's reason for selling will be different, but you should ask yourself these five questions, before placing your home on the market.
1. What is the reason for selling your house?
Most sellers do not decide to sell their home just on a whim and without any rhyme or reason. Selling a house can be time, money, and energy consuming, so having a clear motivation, provide the necessary focus to drive the process.
Most of the time, home sellers are triggered or forced into a property sale by one of their lifecycle stages or lifechanging events - the so-called "9 D's" :
- downscale : when you retire and can only afford a smaller property, or have children leaving the nest, moving to a smaller home is prudent with its lower utility bills and easier maintenance requirements.
Upscaling is just the opposite - getting married, having a growing family, getting a pet, or earning a higher income, will make it possible to afford a bigger, more exclusive or pet friendly home in a better suburb. First-time homebuyers often outgrow their starter homes - with or without a growing family. Multi-generational homes are also becoming very popular - so sellers need to find a new home which will accommodate aging parents or adult children moving back home.
- depart : career moves sometimes necessitate transfers to different working places in other cities / towns. CV-19 has also created a new move to work from home in more scenic locations. Emigrations mostly necessitate selling - to be able to afford a home in a much more expensive property market. Widowed or retired sellers also sell to move closer to their family or to a new location.
- divorce : most divorces necessitate the sale of the home / a property.
- debt : a changed personal financial situation - e.g. when you are in need to settle debts or want to keep afloat during financial hardship
- death : inheriting a property which does not fit your lifestyle or needs, or a shared inheritance property which "cannot be shared" and needs to be "liquidated".
- divest : some homeowners prefer "cashing in" the equity of their homes and taking advantage of the appreciation in property values, by selling their homes and using the funds for "other things".
- disease (or injuries) : Illness and injuries also can make a property incompatible with the seller's "changed" lifestyle.
- disillusionment : negative changes in your neighbourhood (such as badly managed municipalities or the addition of too many commercial buildings making the suburb too busy / noisy) or bad memories in your home from which you want to move away.
- deferring maintenance / improvements: for some people buying a new home is just easier, than to spend a lot on or repairs or renovations by putting on a new roof or building a garage.
The reason for selling is a very sensitive topic and sellers must very clear on what they or their estate agents divulge to buyers, as it can have a direct effect on the price offered by a buyer. Sellers must be very specific on which personal or financial information estate agents can divulge to the buyers.
On the other hand, if time is not of the essence, waiting for the right selling price is an option. With the guidance of your registered property practitioner (estate agent), timelines and selling expectations will be discussed throughout the process.
2. Is it the right time to sell?
There are phases in the property market that will favour buyers, and there are phases that will favour sellers. It all depends on the economic environment and conditions that surround the property market.
While there is generally a market trend throughout the country, there will also be certain areas that buck the trend due to specific, unique circumstances that influence a particular market. Ideally, before listing their property, a homeowner should talk to a CCH real estate professional with extensive working knowledge of their specific market who can analyse current sales inventory and trends.
3. What is the right marketing and selling price?
Setting the right asking price (marketing price) is imperative to getting the best possible result (selling price) out of the home sale. A crucial mistake that many sellers make is overpricing the home's marketing price to counteract buyer negotiations. The problems with pricing a home above its perceived fair market value, is that:
- many buyers will not even take the time to view it. Buyers would rather look at other properties that they deem to be priced at what they consider a reasonable, market-related price;
- pre-qualified buyers search on property portals according to their affordability - that means, within a definite price bracket. If the marketing price is just outside that "price bracket", all serious and pre-qualified buyers will not even view your property.
All overestimated prices make properties that are priced correctly look like a bargain or better "value for money" buy - in fact, a wrongly priced home very quickly becomes a "tool" in the highly competitive property market, which are used to sell correctly priced homes purely by way of a comparative value measurement. Homes compete against each other - the "competition" (other similar homes in the market) will play a huge role in the selling price achieved.
A home that is priced correctly will appeal to a wider range of buyers and be sold within the shortest possible time. When a buyer is comparing properties that are in a similar area and offer similar features, price becomes the number one factor that will influence their decision-making process.
4. How does a seller know whether their home is priced correctly?
An estate agent will be able to provide the seller with a comparative market analysis (CMA), which will give them an accurate indication of what other homes are selling for in their particular area. Factors that are included in a CMA would be the average price per square metre in the area, recent sale prices of similar homes, and comparative prices of other properties that are still on the market. This information will help establish a reasonable price bracket for the property.
Once the agent has the correct price bracket for the home, they will then determine what features or unique qualities could set the property apart from others in the area to give a more accurate gauge of the home's value.
5. What is the exit strategy?
Although it is possible to have an estimated time frame as to how long the property will be on the market, it is impossible to pinpoint the exact day the home will be sold. The seller will need to establish a plan in case it happens quickly.
Before the home is listed, it is a good idea for the seller to know where they will go if they are in-between homes. They will need to decide whether they would want to stay in their current property and pay occupation rent, or move to a temporary housing situation with a friend or relative perhaps. A post-sale plan will take some of the anxiety out of selling your home.
Having the answers to these five questions will help to ensure that the process of selling a home is less stressful and a far easier procedure to handle.
Our member agents are trained registered professionals with the expertise and experience that know how to problem-solve, fully understand the process and each step in depth, and do all the leg work for you.
Other very necessary "research topics" for property sellers will be:
- What is the equity on your property? This is a very important question for each seller - as you need to determine your potential profit from the property sale. You can get a rough estimate of your property value by doing some online research or asking an estate agent for a comparative market analysis (CMA). Checking your bond statement and contacting your bank to confirm how much you owe on your property, will be important to estimate the potential equity in your property.
- What are the costs involved in selling your property and how much can you afford to spend? Selling a property can involve various expenses, such as bond cancellation fees, compliance certificates, estate agent commissions and even a banking penalty fee (if you would not provide the bank with a 3 months' notice period of the cancellation of the home loan). You should have a realistic budget and a clear understanding of the costs before you contact an estate agent. You should also ask your estate agent about their commission structure and services and compare them with other property practitioners (estate agents) in the area.
- What improvements or repairs do you need to make to your property before you list it? Depending on the condition and features of your property, you may need to do some minor or major improvements or repairs to make it more attractive and appealing to potential buyers. You should also consider staging your property or decluttering it to create a good impression. You should ask your agent for their advice on what improvements or repairs are worth doing and how they can affect the property's value and logically your selling price and time spend on marketing the property.
Source: Myproperty.co.za
Author Benhard Wiese
Published 03 Jul 2023 / Views -