In the January 2019 issue of Lake magazine, I jotted down a few negotiation tips pertaining to waterfront real estate here at Lake Martin. Once my list was completed, I realized that they were all from the buyer’s point of view.
That ain’t fair.
There are two sides to every real estate transaction, obviously. So what about the sellers? Don’t they deserve to have their own Top Secret tips? Sure, they do! Except, like a lot of my other musings, there is nothing too secret about these. They are mostly common sense. But just because they are simple to write does not mean they are easy to follow. Below please find three tips and a bonus that will hopefully help you sell your Lake Martin property.
Disclaimers: every sale is unique, so please follow the advice of your attorney, CPA and real estate agent. I doubt that they would contradict the below, but it makes me feel official to have disclaimers.
Tour a few homes that are your competition
It is very tempting to fall into thinking, “Hey, my house is really special, and it only takes one person to like it. I have no competition.”
I think it is really critical for anyone who is selling real estate to realize that they are in a competition. Comparison-shopping is a natural thing for buyers. Think about the last thing you bought, whether online or in a store. I am sure you picked up at least three other items during your shopping trip. A seller’s home must compete for the ever-dwindling attention of the real estate buyer, too.
That’s why I think clever sellers will ask the listing agent to create a list of the competing homes; study them online; and then, walk through a couple. This will give the sellers more information that will help them negotiate from a place of educated objectivity instead of blissful ignorance.
Try to understand the buyer’s priorities
In January, I advised the buyers to try to understand the seller’s priorities, so turnabout is fair play. Why is the buyer purchasing your home? There is about an 80 percent chance at Lake Martin that it will be a second home, which means they don’t have to buy. There will be little or no urgency in the purchase, so don’t expect to be able to pressure the buyer.
Be nice and remember tip No. 1: The buyer has other options. Beyond that, try to understand if the buyer prioritizes a fast close or a thorough disclosure of the property or anything like that. Knowing where the buyers are coming from will help you bridge the gap in any negotiation.
Mentally prepare for the inspection
Inspections can cause lots of anxiety for sellers. I understand why: They envision teams of Sherlock Holmes types crawling through the home, magnifying glasses at the ready.
Honestly, on the whole, I think most buyers are pretty understanding with home inspections. Maybe it is because we are mostly a second-home market, but I find that most buyers take a big picture view and don’t get hung up in the details. That being said, I do think inspections require the seller to get mentally prepared. Just go ahead and mark it down: The inspector will note some nit-picky items. If the bannisters on your stairs are too far apart; if your carpet doesn’t have the proper weave; or if your lava lamp is out of lava; it will show up in the report.
Take it easy. Don’t worry. I am sure the buyers won’t run away before giving you a chance to explain or at least to correct it. Also, please know that related inspections might happen, as well. For instance, it is pretty typical that your septic tank will be inspected. That means that the septic company will dig up the lid, remove it and pump the tank.
Yes, I realize that you haven’t had a problem with the septic in 32 years. The buyers still will want it inspected. It is okay. This is normal.
Bonus: Don’t expect a price increase in 2019
I labeled this as a bonus because it is temporal. If, dear reader, you come across this article in 2039, the first three tips will probably still apply. The Bonus might not.
Heck, if I were honest, I would have to admit it might not even apply in 2019; however, it is my opinion that our seller’s market here at Lake Martin is winding down. I documented some statistics last month, but I think that we should not expect an increase in prices in waterfront real estate in 2019. I think sellers that price their homes too high risk being on the market a long time. So when you and your agent agree on a price, please don’t expect another increase. Again, I could very well be wrong on this, but for the last 13 months, Lake Martin has been in a decreasing sales environment.
The application to negotiation is this: When you get an offer, do your best to make the deal work. Don’t get me wrong – I still think 2019 will be a good year. I just don’t think it will be The Greatest Year.
Note: I originally published this article in my column in Lake Magazine. I am proud to write about Lake Martin Real Estate for Lake Magazine and ACRE – the Alabama Center for Real Estate.