Home selling challenges

There are many different challenges that can occur during a sale of a home. Selling a home can be a stressful experience. Current market conditions coupled with any urgency to be free of the property can make a seller vulnerable to low offers. Sellers also may be presented with a saturated market, and they may need to make costly repairs or upgrades to their home in order for it attract a buyer. A real estate professional can help navigate the home-selling process, but hiring the best individual can be a challenge in and of itself.

There are already common and basic challenges to selling a house, but major home selling challenge also present themselves as time goes by. Here are the home selling challenges in 2022.

Home Selling Challenge # 1: Market Condition – Buyers or Sellers’ Market.

Selling your home when the market already is saturated with existing houses, new construction and foreclosed homes presents a financial challenge. Buyers tend to have the advantage in a crowded market because there’s more inventory to choose from. With a greater selection of housing comes added competition among sellers to attract buyers, which in turn drives prices down. In a robust housing market, the advantage typically shifts to the seller because fewer homes means less competition. In this situation, buyers may be willing to pay a higher price on a home in order to snatch it up before someone else.

Home Selling Challenge # 2: Repair and Maintenance Issue.

Before you put your home on the market, it’s imperative to dedicate time and money to ensuring it’s in good condition. Complete certain home repairs before listing. Clean and cover up dingy walls with a fresh coat of paint, replace the stained carpet, and maintain a clean, polished appearance for every open house or showing. It may be tempting to put the house on the market prematurely, but buyers won’t appreciate walking through rooms and hallways cluttered with paint cans, ladders and home-improvement equipment. Complete all home repairs before you begin marketing.

Home Selling Challenge # 3: Realistic Asking Price.

One goal when you’re selling your house is to get as much money as possible. It’s tempting to overprice. Testing the market by setting your home’s price above what the house is worth is a not a good strategy. If you overprice, you won’t get offers, you lose credibility, and your house gets stale in the market. You must price your home competitively so that it’s not too much higher than your competition but not too much lower either.

If your house is on the market longer than 30 days, buyers will start wondering whether something’s wrong with it. Buyers may shun homes in which they think sellers have set unrealistic prices. Work with an experienced, and educated real estate agent who can recommend a fair market price based on the area, your home’s attributes, and comparable homes that have sold and that are currently for sale.

When you price your home too high, all you’re doing is putting blood in the water for the sharks who will wait until you lower your price. When you do drop the price, you often get less for your house than if you offered a realistic price from the start. The longer a house sits on the market “translates directly to a larger discount from list price to ultimate sales price.”

Home Selling Challenge # 4: Finding the Perfect Real Estate Agent.

Homeowners put one of their largest assets on the line when they sell their home. That’s why finding the right real estate agent can make the experience less stressful. The requirements for real estate licensure vary among states, and agents can become certified in specific areas of the market with additional education and training. Ask a prospective real estate agent the following: What is your work experience and knowledge of the area, do you belong to the Multiple Listing Service (MLS), how many homes have you listed and sold, and what is your commission. Choose the agent that offers a comprehensive marketing strategy and has a history of success. If the Agent does not have his own real estate website, dedicated marketing portal, social media presence, it’s an indication that he has serious lacking in marketing and selling real estate.

Home Selling Challenge # 5: Correctly Pricing the Home.

When selling a home there is no guideline that can tell you exactly what your home will sell for.  The pricing of a home is one of the biggest challenges many home owners face when selling. If you do not price your home correctly, you can scare off the best buyers before you ever get a chance to show them your home.

The price that a home enters the market at is very important. A home that is overpriced when entering the market generally will not receive many inquiries and showings. The longer a home sits on the market the more and more a buyer begins to wonder what is wrong with the home. There may be nothing wrong with the home, but a home that lingers on the market begins to obtain a “stigma” that something is wrong with it. There are some home renovations that add tremendous value to your home. Consult with your realtor.

A home that is priced correctly from the beginning would get lots of activity and showings the first week or two it has been listed and possibly sold in that time frame as well. Every home owner will face the challenge of pricing their home for sale. Choosing a top Real Estate Agent who has experience, knowledge and a strong record of success when it comes to pricing homes can make this challenge less strenuous.

Selling Home at a Loss.

If you sell your primary home at a loss, you may be eligible to write off the loss as a tax deduction if you reduced your mortgage through a refinance or you lost your home to foreclosure. The IRS views foreclosure relief as income because you’re no longer on the hook for the debt. Tax laws exclude a portion of forgiven debt from being counted as income, so consult with a qualified accountant to ensure that you don’t take a bigger hit than you have to when you sell at a loss.

Maintaining a Show Ready Home.

Keeping your home in “show ready” condition is a big challenge for the seller. Moreover, keeping the rooms de-cluttered or making sure the counter tops are clean may seem easy, but after weeks of having to do so, it can really wear down a home owner. The staging of a home in many cases can mean removing many items that you may use on a daily basis. After a while this can be very frustrating. Keeping a home show ready with kids is more challenging. If you have kids, keep your home free of clutter. Have a designated kid area. Clear up unused toys. Create clever storage solutions. Stay consistent with daily chores. Make some grab & go bags.

Passing the Home Inspection.

Selling your home involves several steps, from selecting the right real estate agent to preparing for showings and dealing with various inspections. A common obstacle many homes sellers face is dealing with the buyer’s bad home inspection report. What to do if a home inspection report comes back loaded with negative items? It should never be a cause for panic. Do not get panic. Talk to your real estate professional and listen to their advice because they’ve seen these issues and can offer a non-emotional response on how to respond to a home inspection report that will help keep the sale process of your home moving forward.  They can either make the repairs or sell the home as-is. So, how does a seller decide which option is best for them? When selling a home as-is or even selling a house in poor condition, homeowners are asking buyers to make the necessary repairs to a home. Because of this, sellers should expect to earn a lower selling price for their home, possibly so much so that making the necessary home repairs would be more affordable. However, this may be a beneficial option for homeowners who need to move quickly or who aren’t in a financial position to make expensive home repairs while moving to a new home.

Receiving a Satisfactory Home Appraisal.

Buyer has to get a satisfactory appraisal for financing the property. Homes can fail to appraise at the correct sale price. If it’s not appraised correctly, it’s an issue in the real estate transaction. If the bank or lender determines that the home’s value is less than the agreed upon purchase price, this can create obstacle in the closing process. The necessity for a satisfactory appraisal is a reason why the pricing of a home is extremely important. If the lender cannot determine the purchase price is in-line with the value, they are not going to lend the buyer more money than the home is worth. One option is the buyer can make up the difference between the appraisal value and the sale price in cash.

A low appraisal doesn’t mean the lender won’t lend. It just means that it will make a loan based on the ratio agreed to in the contract at the appraised value. It’s often the best solution is to simply reduce the price if the home was overpriced or the value was inflated. It makes the buyer happy and the lender is satisfied. And it might be worth it to keep the buyer.

Artificially inflated prices can result from multiple offers, and declining market values can result when fewer buyers are shopping among a larger inventory of homes. Market values can rise due to limited inventory and few comparable sales. An inexperienced appraiser who doesn’t understand local influences on value can also be the culprit. The appraiser might have overlooked pending sale data, which could reflect higher comparable sales when closed, or they might have selected comparable sales from the wrong neighborhoods.

Closing the Deal.

Once the buyer and the seller have negotiated an offer and buyer have been pre-approved for a mortgage, you might think that you are in the clear as far as your closing goes. However, that is not always the case. Many surprising things can put a halt to closing. Some may ultimately stop the closing altogether while others could simply cause a delay.

A common issue that can happen prior to the closing is a buyer getting disapproved.  There are many things that a buyer can potentially do that can disapprove the mortgage. Changing employers is one way to interfere with the closing. Another deal-breaker can be switching positions with your current employer. A new job title could be a problem at closing. While this is completely out of the seller’s hands. It’s still a possible challenge that must be overcome when selling a home.

It is easy to assume that lenders will already have all the documents that they need by closing, but that is not necessarily the case. Lenders can become overwhelmed with work, especially during a hot real estate market. Lenders will sometimes realize that they need more information last-minute. They might ask for a canceled check, copies of your rental agreement, current pay stubs or other items. If you don’t have the documentation handy, it could cause your closing to be delayed or even completely canceled if you can’t produce the requested information. If you are relying on your bank to transfer funds right before closing, then you might be shocked if the transfer falls through at the last minute. To avoid this situation, make sure that you consistently communicate with your lender throughout the loan process.

Home Selling Challenges – Wrap Up

Perhaps you’ve considered selling your home because you need additional space, you want to downsize, or are relocating for any number of reasons. Whatever your motivation, it’s important to be prepared for the sales process – even more so if you want to sell your house fast. Closing on a real estate transaction is something that you don’t want to derail. Avoiding the above mistakes will help ensure a stress-free closing transaction. Selling your home can be both emotional and stressful, especially for a first-time home seller. If you follow these tips, you can set yourself ahead of the competition by convincing buyers that your home is the one for them. By having the knowledge that unforeseen challenges will exist when selling a home can also make all the difference.

Most of the challenges when selling a home are out of the home owners control. Many of the home selling challenges are in their complete control. The above top home selling challenges are the most common that you can expect. Remember that no two real estate transactions are the same, so it’s possible others may arise. Remember that you can count on us to remain committed to your success throughout the entire home buying and/or selling process. If you’re thinking to sell your home, Call Faruk Bhuiyan Now (562) 213-8892 for a Free Consultation. Contact Us for selling your home.