Living in a hot neighborhood can give you a big head when it comes to your property value. Especially if you’ve spent the last couple years watching neighbors sell their houses for continuously climbing prices, when you’re finally ready to put your home on the market you’re likely expecting to sell at the top of the range, if not the record price so far.
Before you test the waters with your home, vowing only to consider offers that meet your (admittedly high) expectations, take a deep breath. A home sale that meets your needs isn’t just about the final sale price on paper – it's also about the contingencies and details that ultimately make the deal a success for everyone involved.
In many cases, the offer that gets you to a sale will be the first one you receive.
Especially when you’re living in a popular and fast real estate market, a good – but not amazing – first offer may make you consider waiting to see what other buyers may be out there. Holding off could lead you to a great offer, but it could also backfire.
It’s important to keep perspective on any interest you get from a potential buyer, and also keep in mind that everything is up for discussion. “There’s always negotiations and countering back and forth,” says Patrick O’Connor, a real estate agent with Premier Sotheby’s International Realty in Naples, Florida.
Even if the first offer you receive isn’t the price you were hoping for, you can easily make a counteroffer or negotiate for other details – like skipping an inspection or allowing you more time to move out – that can make the deal the right one for you.
Here are five scenarios where the first offer is the one you’ll want to accept.
When the timing is right. Timing is everything in real estate, and if your home is on the market too long, people will assume there’s something wrong with it. Even if it was simply a matter of asking too much at first, it’s hard to stir up interest when the "for sale" sign is just sitting in the front yard for weeks.
“The first three weeks is usually the most active that property will have,” O’Connor says. Beyond that, you’ll likely start to see dwindling interest.
If you get an offer in the early days of putting your home on the market, it’s important to consider it because playing the waiting game easily backfires once the listing is deemed older.
To take advantage of the first weeks on market, strategize with your real estate agent about the best time of year to list. While the time period from Thanksgiving through the New Year's is typically pretty dead in terms of real estate activity, you can put your home on the market when buyers jump back in at the beginning of January.
“You get that appreciation boost after the first of the year,” says Lennox Scott, chairman and CEO of John L. Scott Real Estate in Bellevue, Washington.
Even with more buyers actively shopping, don’t take your first interested buyers lightly, as there will likely be fewer who show interest in your home as time goes by.
When it’s a cash offer. The highest price isn’t necessarily the best deal, but a cash offer can make for a much smoother transaction.
“If you have a cash offer, that means there’s one less contingency,” O’Connor says. He recalls a recent deal where the buyer made an all-cash offer contingent only on inspection – no appraisal and no waiting for lender approval on the buyer or property. Closing dates can be moved up much easier with a cash purchase.
When you’ve got a limited buyer pool. It may be that your property is valued particularly high or maybe it’s got a unique curb appeal, with a brightly colored exterior or bamboo plants out front, but homes that don’t appeal to the general public can be trickier to sell.
“Sometimes when you sell a quirky house or a contemporary house, your buyer pool goes down,” says Mark Parrish, a luxury real estate agent in the Minneapolis–St. Paul area.
With a smaller overall group of buyers to start from, there’s a good chance offers will be few and far between. For the sake of the sale price, the first offer you get will likely be your best bet.
With many major companies in the U.S. relocating from small towns to major markets, should small-town homeowners worry about home values?
When you’re pressed for time. Moves come about for a variety of reasons, and sometimes they’re out of your control. If you have to relocate to a new city or state for work, it’s much easier when you’re able to reduce the amount of time you have to pay for living expenses at two homes.
For families in particular, O’Connor says selling the property quickly is a priority. He says it’s fairly common for one spouse to move first for work, while the other spouse and kids remain behind while the property is on the market,.
“You want to get that family together as quickly as possible – that’s very stressful on the family,” O’Connor says.
You may also need to move quickly for financial reasons. If your job situation has changed and you’re now making less, relieving yourself from pricey mortgage payments will be a big relief. Communicate your motivations for the move to your real estate agent. He or she should be able to market the property to secure the best price possible quickly, while also keeping an eye out for offers that don’t seem serious to avoid the potential for a deal that falls through.
When you’ve already found your next home. Sometimes it’s a strain to pay two mortgages at once, and other times it’s financially impossible. You certainly don’t have to accept a low-ball offer simply to get a house off your hands, but that first offer shouldn’t be anything you scoff at.
Even when you are financially able to purchase a second property and move prior to selling, O’Connor points out that a vacant home has its own difficulties. “When a house sits empty, things happen to it,” O’Connor says, alluding to heating problems, burst pipes and break-ins that can go unnoticed when no one’s living at the residence.
If you do move prior to selling, O’Connor recommends bringing in a professional stager to help potential buyers picture the space with furnishings.
When you do receive an offer, consider all the contingencies involved, and ask your agent if there are any red flags. If the buyer isn’t preapproved by a lender, for example, there’s a greater chance the deal could fail. Your local multiple listing service will still note the previous days on market, which immediately makes your property appear less desirable as buyers wonder why it's been available for so long.
But red flags aside, don’t get greedy about offers or compare your home to other houses that sold on your street. After all, it takes is one offer to sell a home.
Draw buyers to your home, not away from your online listing.
Eighty-eight percent of homebuyers use the internet as part of their home search, according to a 2015 National Association of Realtors report. That’s clearly a portion of buyers you can’t afford to miss when selling your home. But what makes an enticing home description? Specifics and honesty are key, but with so many home listings out there, it’s also important to avoid phrases and terms that have become cliche or have taken on a new meaning. Read on for real estate buzzwords to leave out of your listing.'Quaint' or 'cozy'
'Quaint' or 'cozy'
Any description of a house pushing the “quaint” and “cozy” factor is likely trying to mask the fact that the house is uncomfortably small. And while the size of a home matters to most buyers, let them determine if it's the right size based on the square footage listed. “Consumers look through a lot of listings. They don’t have the patience to decode all the cliches and euphemisms,” says Steve Udelson, president of Owners.com, a website for self-directed homebuyers and sellers.'Luxury'
High-end homes attract a whole new set of potential buyers, but “luxury” has been so overused it’s hard to tell the difference anymore. “You’ll find various listings that are by no means ‘luxury’ or ‘luxurious,’” says Michelle Farber Ross, a broker and managing partner at MMD Realty, based in Fort Lauderdale, Florida. “Agents use those buzzwords, and you look and think, ‘Oh gosh, this would never be a luxury home.’” She notes the true luxury market begins at $1 million (and starts even higher in pricey cities such as New York and San Francisco).'Up-and-coming'
The description of being in an “up-and-coming” neighborhood has taken on a whole new meaning – and often not a positive one. This phrase is a veiled attempt at pointing out a high-crime neighborhood, which gets into dangerous territory, as the Fair Housing Act prohibits providing subjective information that may steer homebuyers toward or away from a neighborhood based primarily on race or any other form of discrimination. “You can’t red-flag a neighborhood,” says Tim Brinkman, owner and broker of The American Real Estate Co. in Keyser, West Virginia. He tells his agents that they should only share information about the neighborhood that's location-based, such as the home's proximity to a grocery store or park.'Priced to sell'
'Priced to sell'
This all-too-common phrase has zero impact on a home description. Plus, Udelson explains, “priced to sell” raises awkward questions for online house hunters: “What does that mean? That means all other listings are not priced to sell?” A home description should remain focused on the home's qualities and let the listed price speak for itself. This phrase and others – including “motivated seller” – diminish the property's selling points and may leave you with lowball offers from buyers looking to score a deal.'Updated'
Every homebuyer may want an updated kitchen and master bath these days, but the word is so vague that it can lead to major letdowns when it comes time to tour the house. “Take that down a notch and be more specific,” Udelson says. New quartz countertops and recently installed stainless steel appliances should be described as such to differentiate from a kitchen that only got a fresh coat of paint.'Needs TLC' or 'Handyman Special'
'Needs TLC' or 'Handyman Special'
Overly vague terms get obnoxious when it comes to fixer-upper properties. Phrases like “needs TLC” and “great potential” fail to note how much work the home needs, often leading buyers to assume the worst so they don't even bother to see the home in person. Brinkman’s least favorite home description is “handyman special.” “Just how handy do they have to be?” he asks, noting this could be minor maintenance or a complete remodel.'Walking distance'
Close proximity to stores, restaurants and public transportation can be a huge selling point for many homes, but clarity is essential because “walking distance” varies significantly by person. While anything less than a mile might be considered walkable by one buyer, any more than a block may be too much for another. “That’s not bad, but you can be more direct,” Udelson says. Note the physical distance to the nearby shopping center or explain that there are no major roads to cross, which makes walking much easier for those who are inclined to pay a higher price for convenience.'This home has it all.'
'This home has it all.'
Lacking an actual description of the property, this phrase does little to draw homebuyers to a home showing. Udelson notes this and other expressions like “the possibilities are endless,” for example, are “vague, overused abstractions” that do little to sell to a new owner. You don’t want to leave room for a potential buyer to doubt a description. Instead, ensure the home's features speak for themselves. A home with a pool, master suite and chef’s kitchen might be everything a buyer wants, but if it’s simply described as having “it all,” the buyer may never check it out.Remember: No need to repeat the basics.
Remember: No need to repeat the basics.
When a property goes into a multiple listing service, the information that breaks down key details of the home, such as the number of bedrooms, bathrooms and age of the house, is presented in list form. Farber Ross warns against repeating those details again in the description you write: “They can see all those statistics on their own – you don’t need to reiterate any of that.” Instead, use the description as an opportunity to describe the type of hardwood floors and countertops that may pique a buyer’s interest.Read More
She has appeared in media interviews across the U.S. including National Public Radio, WTOP (Washington, D.C.) and KOH (Reno, Nevada) and various print publications, as well as having served on panels discussing real estate development, city planning policy and homebuilding.
Previously, she served as a researcher of commercial real estate transactions and information, and is currently a member of the National Association of Real Estate Editors. Thorsby studied Political Science at the University of Michigan, where she also served as a news reporter and editor for the student newspaper The Michigan Daily. Follow her on Twitter or write to her at firstname.lastname@example.org.
Devon Thorsby | June 5, 2019
Homeowners should not fret, as long as they're prepared for the possibility of a downturn.