(Transcription Below)

Selling your house is a big step.

You have a lot of money at stake, and of course you want the best possible result. What most people don’t fully realize is that selling your house is not a single event, but it’s rather a process that starts well before you put the property on the market, and it goes all the way to the closing table, and there are a lot of steps in between.

How much money you ultimately walk away from the sale of your house depends on how well each and every individual one of these steps is going to be executed. If you can do five things just 1% better to increase the final sales price, that can add up to a lot of money. Or not, if you’re making mistakes along the way. So, today we’re going to take a look at the 10 biggest opportunities to move the needle on your bank account when selling your house. What are these 10 steps? Let’s take a look.

Selling a house is one of these things that sound fairly easy and straightforward at first when you start thinking about it. But the more you start looking into the process and into the details, you discover that things are getting a little bit more complex. There’s just a lot of these technical how-to questions that need to be answered correctly, all the way from, “How do I prepare a house for selling?” to, “How do I best reach the largest amount of potential buyers within the first 24 hours when you’re preparing for that opening weekend?” to, “How do you play your cards correctly if you have multiple offers on the table? How do you negotiate with multiple parties at the same time?” And of course, there’s legal ramifications to every real estate transaction.

So there’s a lot of things to consider that have an impact on your ultimate financial outcome. The better you manage those things, or I should say the better those things are being managed for you, the better the outcome ultimately is going to be.

What I’m about to tell you is pretty much the same across the country. It doesn’t really matter if you’re here locally in the Greater Milwaukee area or if you’re in another state, the principles are going to be always the same, the details vary a little bit.

I should probably also mention that we’re on track this year to close about 80 to 100 transactions, that’s between my team and me. I am doing a little bit more than half of that volume personally. That gives me a great benefit that I’m seeing a lot of transactions, both from the seller side and also from the buyer’s side. On every single transaction, I can see things that could have been done better. I see how buyers are responding to a property when they’re seeing it the first time, what they’re paying attention to, what’s important to them, what is their thought process.

When I’m working with sellers, I see how they’re responding to offers, what matters to them in an offer, and how they pick between multiple competing offers. So I can draw from that experience. The reason I’m mentioning this is because the points that I have lined up for you here, these 10 things that are going to move the needle on your bank account when selling your home, these are based on those experiences.

The other thing that we’re seeing is there is a huge difference in the skill levels of the real estate agents that we’re working with. So no matter if I’m representing a seller, or if I’m representing a buyer, there’s always going to be an agent on the other side of the transaction. And then we work with that agent for the next four to six weeks. What we’re seeing is there is a big difference in the skill levels of those agents. There are some that are very good. They’re quite frankly, a pleasure to work with, even though they’re oftentimes very tough negotiators, but they’re just professional in how they are to work with.

There’s other agents that are, well, not so good, and that can be frustrating. So a solid piece of advice that I can offer you is don’t work with the first agent that you discover, but take the time to interview two or three agents and find somebody who has the necessary expertise and can provide you good guidance throughout the process and manage the transaction for you for the desired outcome. Find somebody who you are on the same page with, who’s on the same wavelength with you, who understands you and who is understanding your goals.

So with that, that’s just a little framework, let’s go take a look. We’re going through the 10 biggest opportunities to make more money, move the needle on your bank account when you’re selling your house. We’re going to do that in chronological order, so I want to start at the beginning with item number one, which is preparing your house for sale.

One of the biggest mistakes that I’m seeing is that homeowners are attempting to prepare or remodel their home before putting it on the market without consulting with an agent. The concern, I think, is that if they are showing the home in the unprepared stage to a real estate agent that may lead to a lower sales price. That might be true with some agents, but it’s also a missed opportunity because an agent will look at the house with fresh eyes. As a homeowner, it’s very easy to become a little bit house blind and to focus on certain issues that you wanted to take care of for years, that really bother you, that may not even be a concern for a buyer. So an agent can provide guidance here.

There is certain things that should be taken care of and should be remodeled before, and there’s other things that you’re better to leave alone, because you’re not going to see a good return on investment. For example, a full bathroom or a kitchen remodel will only bring you about 50 to 60 return on investment. So it will not increase the sales price of the home as much as you’re spending on remodeling it. On the other hand, if you have a dilapidated garage door, it can make a big impact on the curb appeal to spend $1,500 on a new garage door, and it can make the outset of the house look so much better. So that’s a missed opportunity.

As you know, remodeling can get very expensive, so don’t waste your money on projects that don’t give you a good ROI and focus your time, money, and energy on things that will actually make a difference. How do you do that? Bring an experienced real estate agent in early in the process. Take a look at the comps, at the comparables, those are your competition. You want to know what they are offering, and then with the help of a real estate agent determine the things that will actually make a difference and focus on those. So hopefully, you don’t have too much to remodel, if anything.

We are moving on to item number two on our list, which is getting the house ready for showings. In the last two or three weeks before you go live, the focus will be on painting, staging, and on cleaning. These three items will not surprise anybody, I supposed yet. It’s interesting when you go out and you look at a lot of properties how many of them are lacking in that department. They’re either not painted or not cleaned at all. They have a horrible odor or they’re not staged at all or just really bad furniture. Of course, that does not help with the presentation of the home. This is really the category and the step where literally tens of thousands of dollars are either made or lost. So the importance of this step can not be overstated. This is why we usually get very much involved in that, because it is absolutely critical for the success.

The first stop that you want to focus on is painting. So depending on the current condition of the home, you may be able to just limit yourself on some touch-up. In some cases, it might be advisable to actually paint the entire house, depending on what the condition is where you start out. But painting can really transform a house, both inside and out, can make a huge difference. So every good house flipper knows that anything you can do with paint is always first choice, because it’s relatively inexpensive and it will make a very big difference in the presentation of the home.

The next step is then going to be staging. For most average home owner, step number one is boxing up a lot of things and packing things, stacking boxes in the basement or in the garage, that’s usually acceptable, or even putting them temporarily in storage. But you want your home generally to be a little bit on the light side. When it comes to furniture, you want all personal items, pictures, and family items to be removed, so a buyer can see themselves in the house and not necessarily you and your family life in there. It’s important for them that they can see their family living there and not your family. So that’s step number two.

And then finally, cleaning. That’s also very important, not only cleaning for cleaning sake, but one of the big impressions that a home makes is always, how does it smell? This is another item that’s sometimes a little bit difficult to explain to a homeowner. If you have gone nose blind on your own home, you may not realize that your home has a certain smell to it. And usually, that goes away with cleaning, but if it doesn’t, then we can also bring in an ozone generator and take care of that, make sure when the house actually hits the market it is staged, looks great, it is clean and it is ready and makes a great impression when people are coming through and when seeing it. So this cannot be overstated. I’m sure this is no news to you, yet so many people are falling short in the department, and it’s absolutely critical. Like I said, tens of thousands of dollars are made or lost in this category.

By the way, there is a lot of good data on the topic of staging, and you can Google this. The NTR, for example, has done a study, and they found that homes that are staged have not only sold faster but they also have sold 6-10% higher in comparison to homes that have not been staged. In my experience, that number 6-10% seems to be a little bit high, but it definitely illustrates the point how important staging is. That also ties in with the entire experience. As a buyer is walking into your home, what are they’re smelling, what are they’re seeing? Does it look amazing? Does it portray a lifestyle that is appealing to them? Is it compelling for them to write an offer that is really strong and really competitive? Because ultimately, that’s what you want.

All right, so the next item is probably one of the most important ones, and that is professional photography and professional videos. It is no surprise that in 2021 most homes are sold on the internet. So how well a home shows up on your screen is vastly important for the success of the sale of the house. For that reason, it is absolutely important to have professional pictures taken. We usually want anywhere between 30 and 50 high definition pictures taken with professional lighting that really makes the house show up well. We sometimes will take interior and exterior pictures on two separate occasions to make sure that we have the light right and we have the sky in the background right and everything looks absolutely perfect and stunning.

It is surprising to me how many homes are still offered for sale with pictures that have obviously been taken with the cell phone camera. I oftentimes tell my buyers that we’re specifically looking for these listings on MLS. Sometimes they have just a little blurry pictures or not very well lit. Sometimes it’s only three to five pictures. This is a great opportunity if you’re a buyer, because now you can look at a listing that will not have a massive amount of traffic. So sometimes we’re the only party making an offer. It can save a buyer literally tens of thousands of dollars if you can make an offer without being in competition. So this is very, very important.

Depending on the property, we will also sometimes bring in a drone. Because having that interesting angle, taking pictures from high up, being able to showcase the grounds, the yards, and the landscaping can really make a property pop online and can really draw in some additional interest. So professional pictures and videos is hugely important. That’s the baseline for all of your online marketing that you’re doing on later on. If your pictures and the videos are off, you don’t have good material for that. So this is super important. Great content will drive more clicks that will drive more traffic, that will get you more offers, more competition, and that will get you a better price for your house.

All right, quick break here. I have to go run out, show a house. Meanwhile, if you liked this video, please give it a thumbs up. That always motivates me. If you have any comments, you can just put them below. I love hearing from you, guys. I’ll be right back, and then we’ll get to the next point.

Item number four on my list on selling for the most amount of money is setting the correct pricing strategy. This is a big one because there is a lot at stake, and it’s a mistake that is very easily made. Most people agree that it is critically important to list at the correct price, but the difficult part is to actually find out what exactly is the correct price point. Now, this is something that young agents oftentimes struggle with, and we can see it pop up at training all the time. There’s a lot of questions around this, and it only gets better with experience. But setting the correct or determining the correct list price for a property is part art and part science. The science part of this is called a CMA, that is a comparative market analysis.

A CMA is very similar in the process to an appraisal. So an agent is looking at comparables of properties that have sold in the neighborhood, similar size, condition, et cetera, in the last six months in that area. And then you are just adjusting the value of these properties for condition or for features. Based on that, you can calculate the fair market value of a property. So now we have a calculated hard number based on the CMA. Now the artistic part comes in with having a feel for the market, knowing what’s going on currently, how hot are condos in the Third Ward at the moment versus single family homes in Marquette. This is where you really have to gauge the temperature of that particular market segment right now. And that can vary with time. For example, in a major holiday, the perfect price point for listing a property may be different a week before the 4th of July versus after the week of 4th of July. So that changes with market condition. But you have to put both pieces together to really determine the optimum listing price point for a property.

So what actually happens if you make a mistake with pricing a property? Scenario number one is that you underprice it. This is less common and, frankly, it is not that big of a problem because the market has a tendency to price up. You are just generating more competition and that is driving the price up. It can still happen that you’re leaving money on the table because you started out too low. Now, scenario number two is a lot more common, and that is overpricing the property. I see that a lot when you have an agent who is not quite sure how to correctly price a property. They don’t want to offend the seller. The seller would rather go with the higher price and try it for a little bit and see what happens. That can potentially be a really expensive mistake.

Because what happens is if you’re priced too high, you’re missing out on the bidding war on the first opening weekend that is driving up the price. So now you’re sitting on the market, you’re receiving feedback that your pricing is too high. So after a few weeks, you decide to lower your price. But what happens now is you’re not creating a bidding war anymore. What happens now is that a buyer says, “Well, they’ve been sitting on the market, they already corrected the price down because they’re overpriced.” And then they come in with an offer that is even below your corrected price. So that can potentially be an expensive mistake to make.

What does the perfect scenario look like? Ideally, you want to be right on point with your list price, and that means a lot of the seasoned buyers who are people that have been in the market for a while, looked at a lot of properties, maybe made offers, but didn’t bid high enough and got bid out in a bidding war situation, they are looking at your listing and they say, “This is a great house, and this is a great price. It is going to be competitive.” And now you can leverage that situation and you can create a bidding war scenario where buyers are bidding up the price of your property. You can also negotiate terms that are favorable for you. Now, this is very different in the 2021 market compared to how it was five years ago. We used to have a completely different pricing strategy, but the way to market is right now you want to be right at that point where you’re creating a lot of interest in your property. You’re still as high as possible, but you’re creating a lot of interest from buyers. And then you receive multiple offers, and this way you can drive up the list price of the property.

Now, important to understand, a few things of what I mentioned is very specific to the 2021 real estate market. For example, five years ago, we were in a completely different market and we had different strategies. If you’re watching this video five years from now, in 2026, then we might be in a completely different market than you need a different strategy. Nevertheless, being right on point with your list price is always going to be super important to your success.

Item number six on my list is negotiating offers. This is a very interesting one because it’s completely different than it used to be, let’s say, three to five years ago. Now, traditionally speaking, you would put a house on the market. After a couple of weeks, you would receive one offer. It would, if you’re lucky, be full asking price, most likely it’s going to be less than asking price. So now you present it to the seller and then you go back to the buyer with the counter offer in an attempt to raise the offer price as close to list price as possible, and then you get an accepted offer.

Today, this works very differently because a good broker will, as soon as you have the first offer in hand, contact all the other agents that either have already shown the property or about to show the property and inform them that there’s already an offer on the table. So now everybody else knows that they have to go over asking price because obviously there’s competition, there’s more offers to be coming in. And then a good agent will start attempting price, but almost more important terms of the contract. So now we’re negotiating terms that are favorably to the seller, because price is almost a given in this market. So it works very, very differently than it used to. And then after you’ve collected all the offers, there’s usually a deadline, either on Saturday or on Sunday afternoon. Then all the offers get formally presented to the seller, and the seller is going to pick the one offer that in combination of price and terms is going to meet their needs the best.

Number seven, selecting the correct offer. Now, this sounds very easy, but it’s actually not, and here is why. So, if you have done everything right until this point, you should end up with anywhere between three offers, five, maybe 10. We have seen a crazy deal last week that got in 36 offers. You have a bunch of offers and now you need to figure out which one is the one that you want to accept. Let’s say, if you have 10 offers and average offer is about 30 pages. So you’re looking at 300 pages of paper. And it’s not only offer price, they also come with different terms, from earnest money to appraisals and inspections and financing and move in and which finance program. So there’s a lot of details to every offer. You have a stack of 300 pages of paper, and within a few hours you need to make a decision which one of these offers will serve your interests best.

I always tell my sellers, “Pick an offer not only based on the highest price, but you also need the highest probability that this particular offer will actually make it across the finish line.” So you need that offer to close, because if that offer doesn’t close, you need to go back on market. And the second time around, your pricing will get not anywhere near close to where it was at the first time when you had your property on the market. So this can cost you a lot of money. So it is very important that you choose an offer that is high in price, favorable in terms, but is very, very likely that it will also make it successfully across the finish line and doesn’t crater on financing, appraisals, inspections or anything that like.

Item number eight, negotiating home inspection results. This is sometimes the toughest negotiations of the entire transaction, because sometimes buyers and/or sellers are really digging in on their position. Usually, you have a home inspection. And after the home inspection is completed, the buyer will ask for certain repairs or concessions. This could be as easy as a swapping out a smoke detector, or it could be as much as replacing all the windows in the entire house. So you have a lot of money at stake. We’re seeing these negotiations going all over the map.

When it comes to inspection issues, the trick is that you want to be proactive and not reactive. Reactive would be waiting for the home inspection results, and then the buyers making a bunch of demands for repairs, and now you have to rush and find a contractor who is able and willing to come out and do these repairs quickly. You end up paying a higher price, probably an express fee as well. The contractor knows the closing date is coming up. This is going to make for a very expensive and also stressful experience to get everything done in time.

The trick is to be proactive. I’m lucky that I have a background in construction and remodeling, so before we put a property on the market, I like to look at everything from chimney flashing to drain tile and find those issues that are better be taken care of proactively before you put the house on the market. Because now you have time to find the right contractor, get them out there, maybe get three bids, get a good price, and get it done and taken care of before you put the property on the market. Now, there’s a lot of issues that you don’t want to take care of. It is neither necessary nor cost effective to address every little single issue. But you have to make the judgment call to find out which repairs are smart to do them before you put the property on the market and which are the things that you are going to leave for the home inspector to find, and the buyer may or may not care about the small detail.

Number nine, navigating appraisal issues. This is potentially a very painful one because you will not know about the result of the appraisal until about one week before closing. You may already have everything packed up and the movers scheduled and ready to go, now you find out that the appraisal came in low and you are potentially not able to close on the deal. So now you’re back on the negotiation table. Either you have to lower the price to meet the appraisal, or you may have to cancel the deal and start over again, which of course is not a desirable strategy.

So what can you do? Again, being proactive is much better than being reactive. There’s a couple of things that can be done proactively. Number one is having the foresight to picking the right offer. Remember when I was talking before about having 10 offers on a table and not picking the one that has the highest price, you want to be very smart about this, and you want to pick the offer that has the highest probability of actually going through appraisal with no problems, so you can take the purchase price and to actually make it a contract price at the closing table. The other strategy there is is to work with the appraiser upfront. The real estate agent can do that and can provide supportive information to actually justify the fair market value of the property.

Finally, item number 10, which is keeping lenders and title companies on track. This is a very boring and technical issue that nobody’s interested and wants to hear about. Nevertheless, it’s very critical. There is not really a financial upside to this, so you cannot really make more money with this. But if you are failing in that department, the consequences can potentially be very, very costly, if you have to delay a deal, you have to delay movers. Sometimes you have two deals daisy chained together, now the other transaction is not closing. So the consequences of not meeting deadlines and having paperwork on track can potentially be very costly.

A lot of agents are trying to wing this and do this a little bit on the side while they’re driving from one showing to the other, keep everybody on track and try to do this on the phone. This is the reason why I have a full-time transaction coordinator. All he does is to keep everybody on track, check in with everybody. There’s a lot of people working on this that need to be coordinated. Everybody needs to do their part so title and financing is ready at closing day, and you can actually exchange keys for money in your bank account.

So those were 10 things that will move the needle when it comes to selling your house and putting more money in your bank account. I think you can see how it adds up. If you just take five of these items and managed to increase the sales price by just 1%, that actually adds up to quite a bit of money. As you probably can tell, I have a passion for real estate and love answering questions. So a lot of people reaching out to me after watching a YouTube video, you can either do this in the comment section below, or you can reach me on my cell phone. You can send me a text message also, or an email. Or if you prefer, you can go directly to my website, onpointrg.com, and book an appointment, it goes straight on my calendar. Let me know how I can help you being successful with your real estate plans. And I’m going to see you at the next video.


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