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Jim Scott
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Jim’s Rules For Sellers

OK, so you think it is time to sell. You need to make a few basic decisions and then be aware of the traps along the way. I hope this article will help out. I have been selling homes for just over thirty years and what follows is my own view of things.

Rule 1: Try to list your property as close to February 1st as possible.

Never be a seller in the second half of the year if you can help it. For some reason, (call me if you want to hear my expanded theory) buyers and sellers operate on different clocks. My research, and others as well, show two basic general truisms; first, appreciation rates are greatest early in the year and second, the rate of sales is higher. Our society has to contend with the school calendar. Families like to move in early summer and purchase in the spring. Ordinarily this means more buyers in the early part of the year, and hence more demand and pressure on prices.

Rule 2: Ignore the garbage in your mailbox.

The next question to answer is who will sell the property. If you want to sell it yourself or use one of the discount brokers, please call me and I will help you out and answer your questions. If you want to use a traditional broker, as over 94% of home sellers do, then read on.

Choosing the right broker is your most important business decision. Personal advertising and other forms of mis-information can distort this decision process. Agents should not be chosen based on their volume of door hangers used. You are choosing a business partner--not someone who has a great punch receipe or who knows the best Chinese take-out joint. 

Listing agents are very important but are only part of the selling process. The agent with the buyer is usually the most important player. The skill of both agents, both professional and interpersonal, will largely determine if the transaction is successful. And by successful I mean a deal wherein no one is sued and the price settled upon has some relationship to market reality.

Agents who tend to get the most listings are generally aggressive in their mailings, personal marketing and porchings (where the stuff is dropped at your door). This tactic has little relationship to what concerns you: getting the best service and price when you sell. It just means they spend a lot of money in promoting themselves. And once you sign up with one of these agents, some other agent within that marketing group will actually service your listing. That agent is usually too busy getting listings to work on them.

Rule 3: Pick an Agent, not a Company

Mass real estate marketing has one aim, to obtain listings. Selling the home is often secondary. Marketing campaigns are designed to promote an individual who leads his or her own selling organization or larger companies. Large companies and other marketing groups (for example the “Smith Team” or “Team Vandelay)” should not be of any real interest to you as you may end up with a different agent. So choose that agent, not the larger organization. Remember you are hiring a short-term business partner.

Rule 4: Avoid Uncle Harry

You know this one; some relative or new agent who happens to be a friend has a license and wants to do their one deal a year. I have seen much grief over this one. Get someone active in the business or a part-time agent who has plenty of experience.

Rule 5: Know How to Choose an Agent

Ignore the pre-packaged lump of paper that accompanies the agent. This is not high school where your grade depended upon the weight of your term paper. You are hiring an agent, not a graphic design studio. Interview three or four agents and choose the one with enough experience, with a high standard of proven integrity and one you can get along with.

Once you think you have a likely candidate, call some other agents in your area and ask them their opinion of that agent. This can be petty, but it is also very illuminating. Agent-to-agent relationships are key to a smooth transaction. Then ask the agent you have selected for a list of their past ten transactions and the contact information for the clients, both buyer and seller. Call one or two at random. If you hear something you do not like, move on to the next agent in line.

Remember you are hiring a person to facilitate a complicated and important transaction. Look for competence and not flash.

Rule 6: Disclose, Disclose, Disclose…

Work closely with your agent and give that agent, in writing, a complete disclosure of facts about your home prior to the marketing process. Nothing is too small to disclose. If the guy next door snores during the month of November, disclose it. If your agent is not on board with this process, fire them. Avoid shortcuts. Good agents know how to let out the skunks(the bad news) at the right time as to not jeopardize your transaction.

Rule 7: Price Right

You and your agent should arrive at a consensus as to the probable selling price of the home. Both of you need to be on planet earth and be frank and honest. This is almost like a pre-sale bargaining session; the agent is really like a buyer seeking to get a market asking price. The seller usually wants an aggressive and often unrealistic price.

Once you two have agreed on the likely price of the completed transaction when your home eventually sells, add five percent and go to market. It is no more complicated than that. Greed and ignorance have no place at the table. Get good information and make a realistic decision.

Rule 8: Avoid Confusion Range Pricing

Get a real price. I think a variable price means neither party has any faith in their respective judgment or in each other. There is no evidence that using this pricing method helps the seller. It is a marketing tool for obtaining listings. Make a real choice about the price and stick with it. The buying public knows they can make any offer on a home for sale. Take car sales for example. Who pays sticker? It is common knowledge that you may offer less for a car than the sticker price. The same is true for homes.

Rule 9: Pay Attention to Who Shows Your Home

The major obstacle to obtaining an offer will be value. If the price is wrong, no marketing will overcome that problem. Demand feedback from other agents who have shown your property. One of my tricks is to compare the ratio of in-area and out-of-area agents who have shown the home. If more than 60% of your showings are done by agents from outside your market area, you have a price problem. Call me for more information on this rule.

Rule 10: Be Careful of Dual Agency

Do not fall prey to selling too early. Make sure the home is properly exposed to all agents and all buyers before selling. Insist on this point. Your agent may subtly discourage other agents, for example, by making the property difficult to show. If your listing agent brings in a buyer very early in the sale process be very careful. If this happens you may want to engage some outside professional assistance. It is in your best interest that the property be exposed to the broad market and to all agents.

Rule 11: Be Flexible

There will be the unexpected roadblocks during the process. Be ready to adapt to changes in the marketing and escrow process. Remember that all parties want the transaction to close and will be operating in good faith. Do not get emotional and demonize other parties in the transaction. Escrow is replete with third parties providing assorted and required services that may cause unintended problems that are no fault of the principals. There are many cooks in the kitchen and often some soup is spilled.

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