Home sellers in Wisconsin often leave five, ten, or even twenty thousand dollars on the table because they don’t know what they don’t know. We launched Essential Real Estate in 2020 to make sure our clients know where they’re at risk of getting burned and how to counter savvy buyer-agent negotiating strategies.
Even during the height of the seller’s market, homeowners missed opportunities to protect equity and gave away money they could have saved. If indicators are accurate, the market is cooling, and in a balanced market, old buyer-favorable negotiating strategies come back into play. If you’re going to be a seller in this market, you will want to keep reading. When you know what I know, you’ll have a better chance of keeping more of your equity in your hands.
Three Negotiating Mistakes You Can’t Make
Assuming the terms are standard. Even experienced sellers look at the price first and say, “Looks good to me. The rest is just standard, right?” Well, yes, the rest is standard, boilerplate contingencies, and that’s where you’re at risk. The Wisconsin offer-to-purchase forms and buyer-agent-crafted contingencies are designed to allow the buyer to renegotiate after they’ve locked you in. Keep this in mind: price is one thing; contingencies are everything. As long as the buyer’s commitment depends on their satisfaction, they aren’t committed, and you don’t have the price. Understand the contingencies, and don’t agree to anything you can’t satisfy at no cost to you.
Pricing where other properties sold. Attractive prices draw a crowd. When you have multiple people bidding on your property, prices go up, and terms get better. Here’s a fact: even with multiple offers, rarely does more than one buyer outbid the crowd. When you see homes selling for 10% over the asking price, it’s tempting to price your home at the sale prices. You have to understand that prices escalated because the asking price drew competition. Pricing at the peak eliminates the crowd you need to create the competition that drives the price and terms. Price in line with the asking prices of recently sold comparable homes, and you’re more likely to get better results.
Trying to time the market. Our market has proven to be more vibrant than most in any economy. More buyers shop for homes in the spring, but more people also list their homes for sale then. Well-qualified people will buy attractive homes in desirable neighborhoods every season, including during the holidays. The best time to sell is when you’re ready to offer your home in its best condition and when you have a strategy. It’s mid-October. Competition for qualified buyers’ attention is as low as it’s been all year. Sure, interest rates are up and moving higher. Here’s a fact to keep in mind: 450 of 1821 homes sold this year in the Madison area were CASH offers. That’s 25% of buyers of homes priced above $300,000 who had cash available to buy without a mortgage.
You worked smart to build equity in your home. It’s our goal to see you keep as much as you can by getting the best price, keeping your sales costs down, and never leaving money on the table. Before you put your home up for sale, meet with us. I promise you’ll learn something you didn’t know.