How to Sell a House Quickly in 2011
Welcome to the 2011 home seller's guide. On this page, you'll learn about the three most important concepts when selling a home. More importantly, you'll learn how to put these concepts into practice. If you want to sell your house quickly, and for the best possible price, you need to follow this plan for success. You can download this tutorial as a PDF document, or you can read it online below.
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Table of Contents:
- The Three P's of Selling a Home
- Pricing Your House to Sell Quickly
- Preparing Your Home for the Market
- Promoting Your Home to the Largest Audience
- Checklist: How to Sell a House, by the Numbers
We are planning to sell our house this year, in 2011, but we've heard it's a tough market for sellers. What can we do to improve our chances of success? How can I sell my house quickly, but without giving it away?
This is one of the most common questions we've been getting from our readers over the last few months. Ever since the housing market crumbled in 2008, it has been a long and hard road for home sellers. There are several reasons for this. Mortgage lenders have tightened their lending requirements, which means there are fewer qualified buyers. Home foreclosures have skyrocketed, which increases the supply of homes available. And prices are still falling in many areas, which makes buyers reluctant to enter the market. When you add these things up, you can see why it's hard to sell your house in the current economy.
I said it was hard, but it's certainly not impossible. In fact, I am evidence of the fact that sellers can succeed in the current market. I was able to sell my house in 2010, at a time when many other homes in my area were sitting on the market for months (details). And I certainly didn't "give it away." In fact, we made a decent profit on the home. So how did I sell my house quickly in such a slow market? Simple. I maximized my use of the three P's. Right now, that might not mean anything to you. But by the time you finish reading this tutorial, you will understand what the three P's are and how they can help you sell your house quickly.
I won't bore you with any more introductory material. I just wanted you to know that I've been where you are (more than once actually), and I was able to sell my house in a fairly short timeframe. So let's get down to brass tacks. Here's how to sell your home quickly in 2011.
The Three P's of Selling a Home
Let me introduce you to the three most important concepts when selling a house. I call them the three P's. They are pricing, preparation and promotion. Right away, you should have a pretty good idea what these elements are, just by their names. But you might not know how to use them to sell your house quickly. And that's exactly what we are going to talk about in this lesson.
Pricing the home is a fairly simple concept, but it's also one that a lot of people get wrong. If you want to sell your home quickly in this kind of market, you have to price it effectively. Preparation is also important, but to a lesser degree. You can attract a buyer with the right price, but you can also turn them away with a lack of preparation. This is where things such as home staging enter the picture. Lastly, we have promotion. This is your marketing strategy. Promotion is how you put your home in front of the largest possible audience in the shortest amount of time. You need all three of these things in place when selling a home. This is how to sell a house successfully in 2011, regardless of what kind of market you are in.
Now that you know what the three P's are, let's look at each one in more detail.
Pricing Your House to Sell Quickly
You could have the most beautiful home in your neighborhood, and you could put it in front of every potential home buyer in your city. But if your house is overpriced, you are going to turn away all of those would-be buyers.
In a strong seller's market, where there is limited inventory and high demand, you might be able to get away with overpricing your house. Eventually, a buyer would come along who was willing to pay more than market value. But not in this market. In 2011, home buyers are well aware of the price erosion that has taken place across the country. How could they not know about it? It's been one of the most frequently reported news stories of the last three years. So, unless the buyer has been living under a rock, they'll know that your house is probably worth less today than it was when you bought it (even if you only bought it five years ago).
What does all of this mean? It means that if you want to sell your house quickly in 2011, you need to price it realistically. You are not going to fool anyone by putting an inflated price tag on your home. You are only going to waste your own time. And don't forget, the buyer's mortgage lender is going to send an appraiser out to determine the current market value of your home. So even if an ill-informed buyer makes an inflated offer, the lender will probably shoot it down after the appraisal process.
Using Comparable Sales or "Comps"
So how do you determine your asking price when trying to sell your house? In a word ... comps. You should become intimately familiar with this real estate term. It's short for "comparable sales," and it refers to homes that are similar to yours that have sold in your area recently. I just hit on the three most important ingredients of a good comp -- a similar home that sold recently in the same area where you are selling. This is what the buyer's real estate agent is going to use to evaluate your asking price. This is what home appraisers are going to look at to determine the market value for your area. So it only makes sense to use the same information when setting your price.
You can start this research process with a simple question. How much are homes selling for in my area? You can get this kind of information on dozens of websites. You can use a website like Zillow.com or Trulia.com to find recently sold homes in your area. Find homes that are similar to yours and see what they're selling for. If you compile enough of this data, you should get a good idea what your home is worth in the current market. If you want to sell your house quickly, you need to start with this kind of market research.
Of course, if you plan to use a listing agent to help you sell the home, he or she will do much of this research for you. But you should still look at the numbers for yourself. Don't put 100% of the responsibility in your agent's hands. You want to get a good feel for your local market so you can set your price accordingly.
The Home Appraisal
Some home sellers will go as far as hiring a professional appraiser to appraise the house. Personally, I've never done this when selling a home. But I can see the logic in it. The two times I sold a house, there were plenty of comparable sales for me to look at. In addition, there were a lot of homes that were similar to mine. So I was able to assess the market value of my house without hiring an appraiser. But you could certainly go this route if you wanted to.
The last time I checked, a professional home appraisal cost around $400 - $600, depending on the size of the home and other factors. And if it helps you sell your house in half the time it would take otherwise, you can easily justify the price.
Regardless of whether you use an appraisal in addition to the comps, or the comps by themselves, you must set the price based on current market conditions. It doesn't matter what you paid for your house when you first bought it. It doesn't matter how much you still owe on your mortgage loan. From a pricing standpoint, these things are irrelevant. Buyers don't care how much money you need to get out of the house. They only care what it's worth right now, in the current market. And if you start here with your asking price, you will have a much higher chance of selling the house quickly.
If you overprice it, you are going to be one of those homeowners who stay on the market for 6, 12 or even 18 months. I see these kinds of listings on Realtor.com all the time. In some cases, you can tell the homeowner made an effort to prepare the house for the market. In other words, they were using two out of the three P's. They prepared the home well, and they were using a popular real estate website to promote it. But the house was still overpriced. Because of this, it sits on the market for many months -- often without a single offer.
Preparing Your Home For the Market
In the previous section, I touched on the importance of preparation. In my opinion, this is the second most important concept when trying to sell a house quickly. Pricing is by far the most important factor, but preparation runs a close second. So does it mean to "prepare" your home for the market? This step includes making basic repairs to the property, as well as staging it for buyers.
In this context, "repairs" does not mean major renovations. It doesn't make sense to spend a ton of money if you're just going to turn around and sell the house. But you do need to make sure everything is in proper working order. If a home buyer opens a cabinet or closet door to look inside, and the knob falls off in her hand, she is going to get a bad impression of the house. Granted, this is one small item within the bigger picture. But if they keep finding items that aren't in working order, they are going to have a negative view of the house. They'll be thinking, "Here's a homeowner who clearly did not maintain his house properly." That's the last thing you want a buyer to think when they are walking through your house. So go through the property with a fine-toothed comb, and make a list of anything that needs to be fixed, replaced or touched up.
The Importance of Home Staging
Home staging is another technique that can help you sell a house quickly. There is some overlap between home staging and basic repairs, but they are still two different things. Earlier, we talked about basic repairs to make the home presentable. Home staging takes it a step further. This is when you make aesthetic improvements to the house, so that it will appeal to the largest possible audience. Home staging includes such things as landscaping the outside, painting the inside, de-cluttering the home, and repositioning furniture to give the impression of space.
Let's revisit the goal of home staging, and how it can help you sell your house in 2011. Let's say you have some buyers coming to look at your house. They've just looked at five other homes in your area, before visiting yours. The other homes were in decent shape, but they were a bit lacking in the presentation department. In other words, they weren't staged effectively. Maybe the paint was a little shabby, or the bathroom light fixtures were outdated, or the landscaping was overgrown. These things can accumulate in the mind of a home buyer, and they have a seriously negative effect.
So now the buyers visit your house. Because you're a smart seller, you've just spent the last three or four weeks staging the heck out of your home. You added a fresh coat of paint to everything. You updated some knobs, handles and light fixtures to make them appear more modern. You stained the fence in your backyard to make it look new. You hired some landscapers to manicure your lawn and trim all your bushes. And you've removed all the excess clutter from the home to make it appear larger.
Because you've done these simple things, the buyers are going to have a more favorable impression of your home. When they pull up to the curb, they're going to be impressed with all of the landscaping work. When they walk inside, they will encounter a new-house smell resulting from all of your painting and cleaning. They will notice that the house feels larger and better organized than the others. And they'll be more inclined to remember your house after they leave.
This is how you get your buyers to come back for a second look, and the second look is what leads to a sale. If you want to sell your house in 2011, you need to impress buyers on the first walk-through so they come back for a second. Remember, most buyers are not making a final purchasing decision based on their first walk-through. Their goal is to weed out the unsuitable properties and narrow down their list. And this is where home staging is crucial. A well-staged home is more likely to bring people back for a second look, and this is the key to selling a house quickly.
Promoting Your Home to the Largest Audience
We've covered two of the three P's already. We talked about the importance of pricing and preparation when trying to sell your house. So now you have a realistic asking price and a presentable house. What's next? Now you are ready to market the home. This is where the final 'P' comes into the picture -- and that's promotion.
Three Websites You Should Use
The key here is to put your house in front of the largest possible audience in the shortest amount of time. This is why you need to put it on the websites that home buyers are already using. There is no need to re-create the wheel here. There are several websites that attract thousands of home buyers every day, and that is where you want to list your home. These sites include Realtor.com, Trulia.com, Zillow.com and others. In fact, if you only list your home on the three websites I just mentioned, you probably won't have to do any other marketing.
You should also make sure your home gets listed on the Multiple Listing Service, or MLS. The real estate agent can do this for you. All agents have access to the MLS, and it should be one of the first things they do to help you market the home.
Of course, it always helps to have a "for sale" sign in your yard too. This will help people find the house after they see it online, and it also helps with the drive-by buyers. These are the people who just drive through neighborhoods they like with an eye out for yard signs. I also recommend having a box or tube full of property flyers. That way, somebody who is just driving by can walk up to the sign and pull a flyer out. This will help them remember which house they were looking at, and who to call for a viewing.
Proper marketing is essential if you want to sell a house quickly. Fortunately, it's also the easiest of the three P's. The best marketing systems already exist -- you just need to plug yourself into them. You don't need to re-create the wheel. Just take some good pictures of your house, create a listing that includes all of the best features, and then list the home on two or three of the most popular real estate websites. And make sure the home is listed on the MLS.
If you do these things (and you've priced the home effectively), you should start attracting buyers within the next few days. If you're in an active real estate market, you might even get some visitors the same day that the listing goes live. And once they visit your house, the home staging takes over. They've seen your house online, and they've got a pretty good idea that the asking price is reasonable. So they come on out for a visit. And when they see all the hard work you've done to make the home stand out, they are more likely to make an offer. This is how to sell a house in 2011.
There is no mystery to all of this -- just research and hard work. If you put in the necessary time and effort to maximize the three P's, you will be much more likely to sell the house quickly. If you neglect one or more of the three P's, you might be one of those people who stays on the market for 6 to 12 months. It's tough to sell a home in the current market, so you need everything to be in your favor.
How to Sell a House - By the Numbers
We've talked about a lot of different things up to this point. So I want to summarize and reiterate some of the key points. Here's a step-by-step checklist that includes all of the things we discussed above.
- Focus on the three P's when trying to sell your house. These are pricing, preparation and promotion.
- Consider hiring a real estate agent to help you list and sell the home. An experienced agent can help you with all of the three P's, but especially the pricing and promotion.
- When pricing your home, think about it objectively. You are marketing a product to buyers. You need to distance yourself from any emotional attachment.
- You need to price your home based on current market conditions. Look at comparable sales in your area to find out what homes are selling for. The best comps are those that are recent, similar and nearby.
- Remember that home buyers and their agents will be using comparable sales to justify your asking price. The same goes for the home appraiser that the lender sends out. You need to be on the same page as these people.
- Consider getting a professional appraisal to help determine your home's value. If you have plenty of comparable sales to look at, you might not need an appraisal. But it certainly never hurts to have a professional's opinion.
- Make necessary repairs to the property. Nothing in the house should be broken, loose, rickety, dented or malfunctioning. These things will just turn buyers off.
- When you're done with the basic repairs, get to work on the home staging. Add a fresh coat of paint wherever it's needed. If you have a yard, make sure it looks healthy and neat. De-clutter the home as much as possible, even if it means putting stuff in storage. Consider updating any outdated fixtures -- the kind that are easy to replace, such as cabinet knobs and light fixtures.
- List your home on the Multiple Listing Service or MLS. This will put it in front of all the real estate agents in your area, as well as their buyers.
- Take lots of quality photographs of your house. Your real estate agent might do this for you. If you're selling a high-end home, you should hire a professional photographer to take photos.
- List your home on the most popular real estate websites to capitalize on their traffic. These include Realtor.com, Trulia.com and Zillow.com.
- Be flexible. It's going to be a buyers market in 2011, just like it was in 2010. So you need to be willing to work with buyers. This might mean paying a portion of their closing costs, or accepting slightly less than your asking price. You might have to be flexible with your closing date as well. Just remember, qualified buyers are few and far between these days. So when you get an offer from a qualified buyer, you should do everything you can to see the deal through.
If you follow the advice given in this article, you should be able to sell your house in 2011. It's going to be another tough year for sellers, but that doesn't mean you can't sell the home. You just need to do it right. You need to capitalize on the three P's of home selling. You need to realize that the market favors the buyer. And you need to take the whole process seriously.
This article answers the question: How do I sell my house quickly in 2011? If you would like to learn more about this topic, you can use the search tool located at the top of our website. There is plenty of advice on this website geared toward home sellers, and the search tool is the easiest way to find it.