What you say can make or break a sale. There are some crucial things to avoid saying. While there may be exceptions to some of these rules, it takes a lot of trial and error to know the right time to break them.
Never Reveal your Motivation or Timeline
Don’t mention that you’ve already bought another house, are facing foreclosure, or need to sell by a specific date. This information gives buyers leverage to lowball your asking price. So, Don’t tell buyers you have to move. They’ll hear “discount.”
Don’t badmouth the neighborhood
Comments like “the neighbors can be noisy” or “traffic gets bad on this street” will send buyers running. If there are legitimate concerns, let them discover these themselves. Or, let your agent handle disclosure requirements.
Avoid discussing what you paid
Whether you’re making a large profit or selling at a loss, this information doesn’t help negotiations. The only number that matters is current market value.
Don’t over-share about problems
While you must disclose material defects legally, you don’t need to volunteer every minor issue. “The HVAC is old but works” plants doubt, whereas letting the inspection speak for itself is often wiser.
Never disparage offers or buyers
Even a lowball offer deserves professional respect. You never know if that buyer will come back with a better number, and word travels fast in local real estate markets.
So, be mindful of oversharing. Disclose what’s required, yes… but, don’t narrate every creak or crack. With that in mind, let’s take a look at some of what buyers might be thinking about.
What is the 3-3-3 Rule in Real Estate?
The 3-3-3 rule is a guideline suggesting that buyers should view at least 3 properties, take 3 days to think about their decision, and offer 3% below asking price. While this rule circulates among buyers, sellers should understand its implications.
For sellers, this means:
- Expect comparison shopping. Your home will be evaluated against others, so competitive pricing and presentation are essential.
- Don’t expect immediate decisions. Buyers taking a few days to decide is normal and healthy; it usually means they’re serious.
- Anticipate some negotiation. A 3% reduction is relatively modest, and if your home is priced correctly, you might counter closer to asking price.
However, in competitive markets, this rule often goes out the window. Well-priced homes in desirable areas frequently receive multiple offers at or above asking price within days of listing.
What is the 5/20/30/40 Rule?
The 5/20/30/40 rule isn’t a standard real estate term. There isn’t a true definition, but it’s definitely gaining popularity among California house hunters. There are even a few memes out there. So, the gist of it is that some buyers do this math.
- 5% rule: This compares the cost of a house versus 5x annual income. If it’s over that amount, the 5/20/30/40 rule says to skip it.
- 20% rule: The loan tenure should not exceed 20 years. This is likely to avoid a loan accruing too much interest over time.
- 30% rule: This is split on the internet. Some view it as the traditional guidance that housing shouldn’t exceed 30% of monthly income. Others view it as making at least 30% of your downpayment.
- 40% rule: This is the opposite of the 30%. If it’s 30% of monthly income then it’s 40% of your downpayment. If it’s 30% of your downpayment, then it’s 40% of monthly income.
For sellers, the most relevant guideline is understanding that buyers typically won’t spend too much of their gross income on housing. This helps you understand who can realistically afford your home and price accordingly.
What to Say when Selling Your Home
You’ll want to know the facts of the home and helpful information. Also, you’ll probably want to avoid doing the talking. Hiring a good Realtor can relieve your stress and handle a bunch of important details that are easy to miss. The Martin Feinberg Team has walked this road with hundreds of homeowners. If you’re thinking about selling, we’ll help you find the right price, timing, and plan to make your move as smooth (and profitable) as possible.