Ten Things to Know Before Selling a House in San Francisco
Are you thinking about selling a house in San Francisco? there are plenty of things to know before you do, but let’s start with ten of them.
1. Know Why You Are Selling!
I know this seems like a strange ”thing to know”—of course, on one level, you know why you’re selling! Still, the process is not always an easy one, and it can be fraught with emotion, especially if this is somewhere you’ve lived for a long time. Being really clear on why you are selling will help you make good choices along the way.
2. Find a Realtor!
Unless you have a lot of time on your hands to learn a new trade, find out who is actively helping clients buy and sell property in your neighborhood and interview them. Your realtor will be someone you will and should be talking to several times a week, so find one who is knowledgeable and easy to speak with.
3. Expert Home Valuation
A “CMA” is a list of all the similar active, pending, and sold properties within a small radius around your house. Sometimes properties from other neighborhoods may be used if your property is very distinctive, or when there are too few comparisons nearby, so that the differences caused by neighborhood are minimized. For instance a $1,000,000 house in the Noe Valley can be compared to $1,000,000 houses in the Eureka Valley, Mission Dolores, and even some parts of Potrero Hill, although finding comparable properties in close proximity to your own is always best.
4. Trust the Numbers
What are the CMA and your realtor telling you? The comparable properties you are seeing in the CMA for your house will be the same ones that the buyer’s agent will show him/her when they are deciding on what price to offer. If the listing price you want isn’t backed up by those comparable properties, it’s unlikely that anyone will submit an offer.
5. The List Price Is Important
The San Francisco real estate market can be brutal. Buyers (and sellers too) are typically very well informed, and they take their search for a house in San Francisco very seriously; they want to get a deal—or at least feel like they‘re getting one. A property listed for a price that is obviously too high will get diminished traffic, and the buyers that do come typically don’t come back even after price reductions. Go out with your realtor and see the properties similar to your house that are currently listed if you are uncertain about what price to list at. Unless you do it, you’ll be less informed about the market than the buyer, because the buyer will almost certainly have gone out and seen every property currently for sale in the price range.
6. Get a Pest Inspection
If you were playing poker, this would be like being allowed to see two of your opponent’s cards. A pest inspection by a reputable inspector typically costs about $500, and will let you know beforehand of any infestation problems in your house. If you leave it to the buyer to find these things out during escrow, you can be certain the buyer will ask you to pay. Also, the pest inspection you pay for will be added to the disclosure package, which will provide more of the information the buyer needs to feel comfortable submitting an offer.
7. Have a Marketing Plan—and an Exit Strategy
From this standpoint, there are two types of properties on the market: good houses at a competitive price, and overpriced houses that don’t sell. A lot of work and know-how should go into arriving at the right listing price. But pricing is an art, not a science. You should have a plan for your property if it is not getting the interest it needs in order to sell, whether that be to remove the property from the market or to reduce the listing price.
8. Home Staging
Staging will help give buyers the best first impression of your property. A nicely updated house should be staged to compete with other similar properties; it’s what creates the buzz that gets buyers to pay top dollar. That said, staging is not always the best tactic, particularly if the house is in need of lots of renovation. In that case, prospective buyers want to see the interior as-is so they can imagine how they would transform it.
9. Assess the Buyer’s Strength
When accepting an offer, be sure of the buyer’s ability to close the deal. Price alone should not be your only qualification. Borrowing is very difficult these days, so if the buyer is not properly qualified, she or he may very well fail to close the deal, leaving you with a property that could now be harder to sell. Buyers are very sensitive to a property’s Days on Market (DOM). Often, it will be the first thing they ask when they walk through the door at an Open House. When a property has been on the market for 30 or 40 days, they may think it is a lemon no one wants, and since this is probably the biggest purchase of their lives it can scare them away.
10. Owning a Home in San Francisco is Wonderful
Finally, something else you already know but whose implications you may not have fully considered: You own a house in San Francisco, which is one of the best places in America to own property. This has been borne out during the recession we just went through. The values of houses in San Francisco are amazing, the down turn is in the past, and, in fact, the market has bounced back making it easy to forget the recession ever happened. When selling a home in San Francisco in the current real estate market it is all about finding the best way to present your property!