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5 Tips for Competing against Foreclosed Homes and Short Sales
With distressed sales accounting for half of all home sales, many home sellers are finding that traditional sales are competing with discounted prices offered by foreclosed properties and short sales in their local area. Here’s some advice to help you attract buyers and compete against the discounted prices offered by distressed properties:
Price the Home Correctly: Home sellers need to price their home according to today’s market and not based on the high price that a neighbor might have received a few years ago. Work with your real estate professional and a licensed home appraiser to price the home accurately based on recent sales activity.
Market the Home More Effectively: Traditional home sellers have access to more marketing channels than distressed properties, since not all distressed properties are found on the Multiple Listing Service (MLS) or by popular search websites. Work with your REALTOR® to ensure your home is actively listed on the MLS to reach a larger audience of buyers than financially distressed homes.
Keep the Home in Top Condition: Foreclosed homes are typically in disrepair and are in need of some repair or renovation after having been left vacant. It can easily cost a new owner tens of thousands of dollars and months of work to get the home back in shape. A home seller should stage their home to give it the appearance of being in “move-in” condition. The house, as well as all closets, should be kept clean and free of clutter to create the appearance of a more spacious home. Sellers can make their home stand out by doing things like landscaping the front yard to improve curb appeal, replacing worn-out carpets and old appliances, applying new paint in key interior rooms, and tackling other minor home improvement projects.
Offer a Quick Closing: An advantage of being a conventional home seller is being able to offer a quick closing, often an advantage for buyers who wish to move quickly. Distressed properties can take many months to reach a closing date. Sellers should be prepared to offer a 30-day closing date to attract buyers who want to move quickly.
Qualify Interested Buyers: Nothing is more discouraging than spending weeks with a prospective buyer, only to learn that he or she is unable to obtain a mortgage. To avoid such situations, make sure that your buyer is pre-approved for the loan amount necessary to finance the purchase of your home.