First-Time Home Sellers: Get Ahead of These 6 Potential Surprises
The best thing first-time home sellers can do is to anticipate the common hiccups and come prepared. Our expert-backed primer with input from top-selling Phoenix-based agent Dave Zajdzinski will brief you on common, unexpected situations first-time sellers encounter.
1. House needs work
You might think your home is in adequate condition for sale. After all, you’ve been living there comfortably for years. It might surprise you to find out that buyers may view your home as dated or in need of some TLC.
“Your home should read like a book — like a story. It should have one complete narrative,” Zajdzinski says. “I have sellers thinking they’ll redo the kitchen when they have a dirt backyard. But you want the story to be complete. If you have everything done but one bathroom, do it.”
He adds that a lot of sellers “overestimate the things they’ve done and underestimate the things that aren’t done,” whereas buyers will notice the state of the house right away with fresh eyes. “So what I would tell people is to finish whatever is lacking” before listing the home, he says.
2. Low appraisal
If your buyer is financing the home, their lender will require an appraisal to ensure the property is really worth the amount on the mortgage. If the appraiser determines the value is lower than the loan amount, the buyer will have to find a way to pay the difference — or back out of the transaction.
Zajdzinski says the key is to anticipate this issue before it happens and make a plan: “If it doesn’t appraise, are you willing to just let the buyer go and we put it back to market? Do you want to come down? What are your expectations, and what are your thoughts prior to it happening?”
If you’re in a hot market where bidding wars are common, you may want to negotiate an appraisal waiver or an appraisal gap guarantee with your buyer. An appraisal waiver is an option for cash buyers to waive the appraisal entirely. An appraisal gap guarantee, on the other hand, is an agreement the buyer will make up the difference between the purchase price and the appraisal.
And if you have a unique property, Zajdzinski advises doing a pre-appraisal before determining a listing price. “Let’s do an appraisal upfront and let’s see where that appraisal comes in just to set the expectation,” he says. “It’s about having a good game plan upfront, so you’re not caught off guard.”
3. Last-minute showings
It can be stressful when your home is on the market, you’re still living in it, and buyers want to schedule last-minute showings that disrupt your daily life. But, Zajdzinski says flexibility is key to a quick and successful sale.
“We advise any first-time seller to keep your house show-ready all the time and just know that this is an inconvenience, but it’s a small window [of time] to get through,” he says. “We say be flexible, don’t let it catch you off guard. Just know that you’re going to get last-minute requests, and you’re going to have people that need to show up — just be ready.”
As annoying as last-minute showings may be, remember that there’s a lot on the line with your home sale. “This is your one chance to get it right,” Zajdzinski reminds. “Right now, people selling homes are getting a massive amount of equity, and we say take advantage of that. Don’t be the reason you’re not getting everything because you’re the constraint to the process.”
4. Escrow delays
If you’re selling a home for the first time and you enter into escrow with a buyer, you might be tempted to exhale. You did it, right? Not necessarily. Home sales can fall through during escrow.
“I’ve had homes flood the day of close. I’ve had people die on the day of close. Just know that this isn’t a done deal until you have the check in your hand and the county has recorded the deed,” Zajdzinski says. “We can’t control all stages of it and something could happen.”
Sellers can anticipate potential pitfalls and increase their chances of closing by strategically choosing an offer that aligns with their goal to sell fast or for a top price.
“We consider how we can mitigate this risk by going with an offer that is going to help us. It’s not always about the most amount of money,” Zajdzinski shares. “We’ll ask our client, ‘For $5,000 more, is it worth taking this offer versus this one over here that’s going to potentially void?’”
5. Well of emotions
You might be selling the home where you brought your babies home from the hospital or hosted Thanksgiving dinner for loved ones every year. With so many memories made in your home, it’s natural to feel emotional when the reality of selling sinks in.
“I tell everybody it’s an emotional process. It’s something we’re very attached to — it’s our home,” Zajdzinski says. “Be aware of those emotions and be ready for them, and don’t let them take over at the wrong times. Get out ahead of everything: Things are less emotional when you’re out ahead of it, and it doesn’t take you off guard.”
Zajdzinski has observed that the home inspection often triggers sellers’ emotions. When the inspection report reveals issues with the home, buyers try to negotiate the price down, which can offend sellers. One of the ways you can avoid this pitfall is to hire a home inspector for a pre-listing inspection early on in the process. That way, you can tackle or at least be aware of needed repairs before a buyer is involved.
6. Moving crunch
Given all the lead-up to selling a home, you might think they have plenty of time to vacate the house until the time finally comes, and you realize how big of a task moving is.
Zajdzinski says he sees the scenario time and time again. “People say, ‘I just wasn’t ready to be out. I thought we would be and we weren’t.’ They think they have enough time, but they underestimate how long it takes to pack and move.”
Zajdzinski has moved many times over the years and has learned to leave a cushion — both as a practical matter and for peace of mind. “My wife and I like to take a little vacation, to be done early, get out, and not be scrambling,” he says. “We leave and let it happen to reduce the stress.”
So he offers this experience-tested tip for first-time home sellers: “Give yourself more time to move than you think you should plan on.”
Header Image Source: (Taylor Wilcox / Unsplash)