When you get ready to sell your property in Annapolis, MD, homeowners want as close to optimal value as possible for their house. However, there are a few misconceptions among both sellers and real estate agents that should be addressed. Namely, the main points of contention are about how you can maximize sale price. Common questions that arise include:
- Does setting a higher price result in higher sale value?
- What repairs and upgrades will make your home worth more?
- Is paying a six percent commission to a realtor pay worth it?
- Am I better off listing and selling my property myself?
All of these questions should be researched when looking to sell your Annapolis property and maximize sale price. With that in mind, here are three secrets to maximizing your home’s sale price.
Make Sure Your Listing Price Is Comparable to Others in Annapolis, MD
When listing your house in Maryland, remember that a high sale price will rarely put more cash in your pocket. Instead, sellers must consider all the comparable sales and available inventory in the area. Listing your property above recent comps and sales tend to be a major turn-off to buyers who are familiar with the local market, which is pretty much everyone living in the current digital age and knows how to do a Google search. Moreover, a quick search on real estate sites, such as Zillow or Redfin, will give buyers a good overview of recently sold comps. By pricing above the current market, a seller could sabotage their efforts to sell their abode quickly and maximize their profits. After all, why would a prospective buyer pay more for what they can already buy for less? This will result in fewer interested buyers and offers, which, in turn, means less competition and interest.
The truth is, a house that is priced too high in Annapolis will rarely sell and it could sit on the market for years. In the meantime, you will continue to pay taxes, insurance, utilities, and maintenance fees for this residence. Furthermore, delays of this nature can create additional re-sale issues. Since the house did not sell, it could be viewed as damaged goods, and because it has been sitting on the market, it no longer generates new listing alerts on real estate websites, so there is a good chance that buyers may not even see your listing.
Another consideration to keep in mind is if you do manage to attract a buyer interested at an above market price, your strategy to maximize your profit could backfire. This is because real estate purchase and sale agreements include an appraisal contingency, which means a licensed appraiser gives his/her opinion on the property’s value before the sale is completed. Therefore, if the appraised value is less than the agreed-upon price, the buyer not only has a right to back out, but the bank and/or lender (if applicable) can opt to reject the mortgage as this residence, which serves as collateral, is worth less than suggested.
In general, the smartest way to maximize your sale price is to list below sales comps and current inventory. As a result, your listing will be inundated with offers from prospective buyers in Annapolis, MD. The next step is to call for “highest and best,” which alerts every bidder to the highest offer. This strategy will often result in bidding wars and make for the best and most profitable sales.
Consider Your Buyers When Making Repairs to Maximize Sale Price
Many Annapolis home sellers are under a mistaken impression that putting a ton of money into fixing up your home will maximize your profit. However, the truth is, it depends on the circumstances involved. As such, you need to have a firm grasp of the return on potential upgrades and their costs, how it will affect your home’s resale value, and an idea about the buyers you are trying to attract.
Different buyers purchase properties for various reasons and each prospective buyer in Maryland has their own tastes. Some might be looking for their first or starter house while others are seeking single-family and/or multi-family houses as rental units. It is also important to consider when is the best time to refurbish a rental unit. Obviously, when a tenant moves out, this is an ideal time to renovate a property, since tenants tend to take less care of the house since they do not own it. Other repairs and upgrades should be considered on a case-by-case basis. How much will these repairs cost? Are they necessary? Will they add value to your residence? All of these questions should be considered prior to making renovations and/or upgrades.
Then, at the other end of the housing market, you have luxury properties. This is a very expensive and specific genre of buyer and home. This is where you will encounter customized features and other upscale amenities. This type of buyer has a large income and savings, so they expect a beautiful house. If you are on a limited budget and would like to attract a richer buyer for your property, do your research and consider any renovations very carefully before making repairs or upgrades. You want to make changes that will appeal to the buyers you are seeking. This is especially true if you or a tenant are living in the unit(s) during repairs. It can be very difficult to reside in a home that is under renovation. Furthermore, it can be a major turn-off to a buyer with expensive tastes.
Know When a Realtor Commission Is Worthwhile
If a property is in excellent condition and has multiple selling points, a realtor can come in handy. These houses always qualify for mortgages, whereas homes in poor or as-is condition might encounter issues passing inspection and/or meeting minimum property standards for bank financing (e.g. issues with plumbing and/or heating system, bad roof, terminates, or mold). A realtor can assist you in understanding how to review financed offers. Moreover, an agent is also valuable when there are multiple offers on a home. After all, it is a realtor’s job to review every offer as part of earning their significant commission.
When to Sell to a “We Buy Houses” Company to Maximize Sale Price
In most cases, if the residence is in poor condition, the opposite circumstance is often true. In such situations, the Annapolis buyer pool tends to be small. This is because only buyers who can handle a “fixer-upper” will be inclined to bid. Moreover, mortgages will not be an option, so bids only come in from prospective buyers who can pay cash for their purchase. Most importantly, many Annapolis buyers are looking to move right away, so properties that are not move-in ready may not work for them. Under these circumstances, Realtors might not be advised and you can best maximize your sale price and/or profits by selling your house on your own with a qualified real estate attorney to help guide through the process and/or legal procedures.
If you are interested in more information on how to maximize your sale price or want to receive an offer for your property in Annapolis, Maryland, contact Dependable Homebuyers online or call us at (410) 779-4622 anytime.