5 Emotional Mistakes That Sellers Make
1. Price reduction paralysis.
In cases of overpricing, the seller has most often started out as overconfident in their home’s prospects on the current market. But as the days on the market turn into weeks, or even months, that overconfidence morphs into panic: panic that the place will only get a lowball offer, panic that the place won’t ever sell, panic that the seller will be stuck in the property, panic that the seller’s future life or career plans will be ruined. The best way to deactivate this panic is to put a plan in place before it ever arises. Work with your agent to understand how to use the data around how long most homes in your area take to sell as a guidepost for making price reductions, if and when the need arises.
2. Excessive attachment.
Yes, this is the place your kid took her first steps, the place you carried your bride over the threshold, maybe even the place your parents built with their bare hands. But at the time you make a decision to sell it, it also becomes a property, an asset, that like any other good you would sell in the course of business, must be marketed and priced and transacted for.
Sellers who are excessively attached to a home are likely to:
- overprice it
- ignore market data, like the recent sales prices of comparable homes nearby
- disregard their agent’s staging advice
- improperly prepare their home for the market, failing to update or neutralize the decor
- be irrational in negotiations around price or repairs
- refuse to respond appropriately to market feedback, like no showings or offers even after it’s been on the market for weeks or months.
3. Ignoring the needs of your target audience.
Understanding your target market is one thing – marketing appropriately for them is another. Your condo’s buyer might be drawn in by mentions of built-in closet organizers, an espresso machine included in the sale and incentives like HOA dues paid a few months in advance. Also, make sure you mention just how close and convenient the place is to the subway station entrance (and mention the station by name) in the home’s marketing materials.
On the other hand, if young or growing families comprise the audience for your home, mentioning custom play structures, the organic vegetable garden, the proximity to quality schools and the built-in desks that are in each “kid’s” room, might be the way to help your home’s listing stand out from the rest.
4. Celebrating too soon.
Multiple offers and above-asking sales prices happen frequently on today’s market, but it’s critical not to assume your home will be in that number until a deal is actually closed. Sellers who “celebrate too soon,” so to speak, can put themselves at a disadvantage in a number of ways, like:
- Cheaping out on staging, failing to do all the items on their property prep list
- Overpricing their homes, assuming the demand-supply imbalance will automatically swing in their favor
- Getting sloppy in how they maintain their homes on a daily basis, while they are still on the market, and
- Making large purchases or spending their house proceeds “in advance,” while the buyer’s loan and inspections are still pending.
5. Price confusion.
Some sellers have a confused understanding of the mechanics of determining the fair market value of a home and setting a list price. This leaves them vulnerable to the trap of letting their financial self-interest and fantasies for the future get in the way of setting a smart list price. A home’s fair market value is defined by what a qualified buyer will pay for it at a given moment in time. The best way to estimate or approximate that for a home before it is actually sold is to look at what qualified buyers have actually paid for very similar nearby homes, as recently as possible.