5 no-no’s when selling your home

Sellers are understandably usually quite emotionally attached to their homes, and in being so, can often be their own worst enemy, potentially jeopardising a successful sale.

International real estate trends expert, Steve Murray, who is also the editor of REAL Trends, a trends research and publishing firm based in Colorado, will be visiting South Africain August by invitation from RE/MAX of Southern Africa, to share some of his key property insights with local agents.

Peter Gilmour, Chairman of RE/MAX of Southern Africa, says that Steve will undoubtedly enrich the working strategies of many of the agents he comes into contact with. “While we are certainly well on the road to a market recovery, current market conditions remain somewhat challenging, and any real estate professional could certainly benefit from tips and insights to better their working practices.

However, says Gilmour, estate agents are not the only ones who need to up their game. “In order to get the best price for their property in the shortest possible time, sellers need to up their game too.”

He refers to an article recently published on real trends courtesy of Brendon DeSimone, a realtor based in San Francisco, a contributor to the Zillow Blog, and collaborator on multiple real estate books, which describes five things that sellers do that could potentially jeopardise a sale.

The article notes that home sellers today are under a lot of stress. It’s a tougher market, home prices have fallen and many are trying to get as much money as possible to recoup their investment. While real estate agents feel sellers’ pain and are on their side, sellers sometimes do things that make it harder for an agent to sell a home for what it’s worth.

Here are five not-so-great things sellers do that make their real estate agents cross their fingers and hope for the best:

1. Sellers who think their property is unique, thus worth more money
Sellers consider their homes special; most likely they’ve put a lot of heart, soul, and money into fixing it up. It may be where they started a family or built a lifetime of memories. When a seller believes their home is unique, however, they also believe it is worth more. Sellers then end up fixating on an asking price that’s too high, despite the advice of an agent. If it’s priced too high, a home will sit on the market for months. Unfortunately, nine out of 10 times, the seller will end up selling for less money than they would have gotten if the home was listed at an appropriate price from the start.

2. The home is a mess
Sellers: It’s important to pick up the home before a showing. Potential buyers touring a home usually don’t appreciate stepping on a child’s toy and fail to see the charm of a dog’s discarded tennis ball. Buyers want to feel that a home is clean and well maintained. If it’s not, they’ll likely move on to the next.

3. Sellers who hang around during an open house
There’s a reason why real estate agents don’t want sellers sticking around when potential buyers arrive. While a seller may be perfectly friendly and agreeable, they can alienate buyers or make them feel uncomfortable without even knowing it.

4. Holding out for extra money at the last minute
Say a buyer made an offer that was less than what the seller wants. The agent and the buyer have gone back and forth with a series of counter offers. The seller is close to achieving their dream price but they insist on trying to squeeze more out of the buyer. In demanding more money, the seller may have created bad will, as well as stressed those involved in the purchase. When it comes down to it, extracting that extra little bit may actually cost the seller more at the end of the transaction.

5. Sellers who don’t clean up before turning over the keys
Sellers should imagine themselves as the future buyer. Would they want to walk into their new home and find twelve cans of old paint in the garage? Or an old sofa with a broken leg in the storeroom? The tip to sellers is to try to make the home as spotless as possible for the new owners. They’ll appreciate it and so will the agent.
“In the current climate, those who want to get the best price for their property are going to have to work a little harder,” says Gilmour.

“Sellers need to view their homes with a critical eye. When a person lives in a house for an extended period of time, they tend to turn a blind eye and overlook problem areas.

Learn to think like a buyer, says Gilmour, and always assume that potential buyers are going to spot the faults. “At the end of the day, sellers need to remember that a well-priced, well-maintained property will appeal far more than an over-priced, under-maintained home.”

Please contact us if you require any further information or would like to apply for finance:

Complete this short form online

011.327.4489 / 0861 1111 93

morne@mortgagepluscc.co.za

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SOLE MANDATES – IS THIS THE BETTER OPTION?

One of the first steps when selling your home is to consider giving an Estate Agent a Sole Mandate; but it is essential to be informed before doing so. Sellers are completely within their rights to ask their Estate Agent to explain the pro’s and cons of selling their home on a Sole Mandate, Open Mandate or through a multiple-listing service.

Essentially there are three type of mandates; Sole Mandates, Open mandates, and Multi-listings. A Sole Mandate, once signed, is a contract between you and the Estate Agency and you cannot simply change your mind about its provisions later and revoke it.

THE SOLE MANDATE

The Sole Mandate is a legally binding contract entered into by the Seller and the Estate Agent. It gives the Agent the legal right to be the only marketer of the property over a certain period of time and at a price agreed to by the Seller and the Agent. If Agents are sincere in their determination to sell a property, then there are many obvious benefits which accrue to Sellers willing to sign a SOLE SELLING MANDATE.

The Sole Mandate system is the most popular in the South African market. It has long tradition within the industry, which has allowed professional Estate Agents to perfect the accompanying marketing plans, ensuring that the marketing of the property receives their full attention and commitment. Selling by Sole Mandate ensures the most possible privacy and least amount of inconvenience to Sellers, and also protects them from double commission claims. This form of marketing is, however, most effective when embraced by well-established Estate Agencies that have strong market penetration in the area in which the property is situated, and whose budgets allow for extensive media advertising.

The choice of whether to go with the Sole Mandate is entirely the choice of the Seller. No Estate Agency can force you to provide it with a Sole Mandate. Naturally Estate Agencies prefer Sole Mandates because of the exclusive rights they have that justifies the effort and costs they put into marketing the property.

They have to offer you exceptional services. They must advertise your home in the appropriate publications as well as on the Internet, with ‘For Sale’ boards outside the property (if the local municipality allows it), and a Show House must be held at least once a month, throughout the mandate period.

It is sensible to give a Sole Mandate for a period of four months. Beware of mandates that add a clause stating the mandate will continue indefinitely beyond expiry date, unless you cancel in writing.

THE OPEN MANDATE

This is often no more than a verbal instruction to an Agency to find a buyer without any further commitment on the Seller’s part. The open mandate liberates Sellers from the need to sign any mandate documents, but is the least effective form of marketing. Professional Agents are reluctant to actively promote an open mandate property in terms of advertising costs and show days, because they know the door is always open for a competitor to step in with a buyer after all their hard work and promotional costs.

It appears attractive and non-committal, but Agencies obviously don’t like doing business like this. The most professional and successful Sellers will brush aside open mandates. It’s always a question of quid pro quo – value for value. If you are looking for a professional Agent to deliver a professional service, the open mandate will probably not be the best choice.

OTHER BENEFITS OF SIGNING A SOLE MANDATE AGREEMENT

It is important to look at the marketing process that the Estate Agent will follow before you sign a Sole Mandate agreement. Ten different, smaller ads will reach more potential buyers than one big ad. The size of the advertisement is not important. Do your homework and obtain references from other Sellers. Decide what price you want to ask for your house. Do not just go with an Agent, because he said that he/she could get you a higher price. Always remember that you determine the price at which you wish your home to be marketed but that you appoint an Agent to do marketing for you.

There are no negatives to signing a Sole Mandate agreement if both parties involved are honest people. It is also important that both parties must come to an agreement on what their expectations from one another are. Quite often, the Seller simply takes some items for granted. It is therefore important that the marketing process forms part of the agreement with your Estate Agent, and this agreement needs to be signed by all parties.

A Sole Mandate is the only evidence the Agent has that the Seller will pay him for his expertise and services. Sellers tend to forget that Agents need to spend money on advertisements etc. to sell the property. If you order a pool, you sign the contract first – no contractor will install a pool and enter into a contractual agreement after the pool has been installed.

Some important aspects that will influence the sale and that a Seller can rely on:

• the Estate Agent will advertise your property on a weekly basis in news papers.
• your property will host a show house every second week until your property is sold;
• a full colour pamphlet will be designed with professional photographs and text to be handed out during the Sole Mandate period;
• your home will be advertised around the globe on the internet;
• you will receive exclusive exposure if you advertise your home with one Estate Agency
• benefit the end result in price if one Estate Agent controls all incoming offers;

The same rules applies when it comes to the Sole Mandate agreement – by signing one, you give permission to the Agent to bring prospective buyers to your home on a daily basis. You confirm that you agree to the terms of the sales process. A Sole Mandate is simply a business agreement – it is a legal document that spells out an agreement between two people. Our law system has look into the Sole Mandate agreement and has implemented clauses that protect both parties. The only thing you need to do is to appoint the right Agent for the job. Of course, in our current times, security is an important factor and this is aided by a mandate with a Sole Agent.

SELLER BENEFITS

There are many good reasons for the Seller to sign a Sole Mandate. We know that Sellers want the most money for their property with the least amount of problems. By dealing with one Agent this can be achieved. It is a fallacy that many Agents will do a better job than one Agent can. All buyers interested in the Seller’s property are funneled through to one Agent who can negotiate with each one and thus obtain the best price.

Conversely, when the property is given to three Agents with different buyers, each Agent is working in isolation. Their interest becomes getting their buyer’s offer accepted first, at any price. The Estate Agent is then working for the buyer because if his/her buyer doesn’t buy, the Agent does not get paid. Pressure is exerted on the Seller to accept the offer being presented, because if that buyer does not get the property another Agent’s buyer will. Buyers perceive the property being offered through one company and not eight or ten as more exclusive. They will feel more secure in knowing that one person is controlling al interested buyers.

Please contact us if you require any further information or would like to apply for finance:

Complete this short form online

011.327.4489 / 0861 1111 93

morne@mortgagepluscc.co.za

www.mortgagepluscc.co.za