8 Reasons Why Your Home Didn’t Sell

by Lynn on August 24, 2016

Is your house a listing loser? Have you been on and off the market for years? There are many factors that influence whether a house sells or not. While most people will point directly to price, that may not be the only reason why a home sits on the multiple listing service without showings or offers and ends up on the expired list.

Here are just a few of the reasons why homes don’t sell:

1. Price

The most common reason and usually the biggest factor is price.  Often a home is priced too high because sellers have unrealistic ideas about what their home is worth. Other sellers insist on basing the price of their home on their own personal financial situation and not the market.

Even if a seller is willing to adjust the price of a home after listing it too high, it is the original asking price that matters. Pricing a home competitively will ultimately yield a higher sale price.

2. Location, location, location

It is true location matters. Even the nicest house cannot always overcome a bad location. Homes that are on busy roads, close to high tension wires, power plants, waste-treatment facilities or other objectionable locations will struggle to sell. The only way properties in undesirable locations sell is when the seller understands that the asking price is significantly lower than similar homes in prime locations.

3. Having the nicest home in the neighborhood

It may feel good to have the largest or nicest home in the neighborhood but buyers won’t appreciate that. Buyers are not only paying for the home but also what is around it. If your home offers much more than other homes in your neighborhood you will have a tough sale.

4. The decor

A home should appeal to almost everyone. So if your home has loud wallpaper, brightly colored walls, or an outdated kitchen it will be a turn-off. Most buyers won’t be able to look beyond the 1970s kitchen and see the good qualities a home has to offer.

5. A dysfunctional floor plan

The addition you added on may be your pride and joy but when the buyer looks at it they see it as a barrier to a sale. Many homeowners add additions or change the floor plan of their home to suit them. They were not thinking that it might not be okay for a future buyer to walk though a bedroom to get to the family room addition. This sometimes applies to older homes as well, smaller rooms and lack of storage does not top a buyer’s wish lists.

6. Too many repairs

If the home needs a lot of repairs, the buyer sees a money pit. Today’s buyer is much more reluctant to take on a lot of renovations.

7. Bad Marketing

This can be the agent’s fault as much as the seller’s fault. Are there agents who could do a better job marketing a home? Of course there is. Often times, the agent is limited by the seller’s willingness to help. Agents that are forced to show photos of messy, outdated homes on MLS are not starting off on the best foot. There is only a small percentage of buyers who are able to see past the mess and cosmetic issues.

8. Unavailability

Sellers sometimes do not make their home available for showings and this can hurt the sale of the home. Buyers have tight schedules and often want to view homes at inconvenient times. Sellers must try to accommodate as many showings as possible. You never know who the buyer will be or when they will want to look at the home.

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Being self-employed comes with a lot of perks. Self-employed workers often have the freedom to set their own schedule, work from home, and take breaks whenever they feel like it. They also have the ability to write things off as business expenses on their taxes.

When it comes to buying a home, this last perk can become a huge problem. If you own your own business or work as a freelancer, odds are you’ll be deducting things from your taxes that the average employee doesn’t: travel expenses, advertising, licensing, equipment, repairs, or even rent for your office. When tax season rolls around, all of these deductions feel like a godsend. But if you plan on buying a home, all of these costs will appear as negative income.

For people who spend a lot of money on their business or freelancing, it could do a lot of damage to your apparent income when lenders take a look at your finances. However, you do have options when it comes to getting approved for a mortgage that is to your liking. In this article, we’ll cover some tips on how to apply for a mortgage when you’re self employed to give yourself the best chance of approval.

Carefully document your income

When you sit down with a lender and hand them your proof if income, you want to make it as obvious as possible that you’re earning money in a reliable and predictable way. Lenders will want to see multiple documents that can help paint a better picture of your income and finances, including:

  • Bank statements
  • Schedule C tax forms
  • Profit and loss tax forms
  • Completed tax returns
  • Credit score (they will run a credit check)

Separate your business and personal finances

If you own your own business, you likely have business banking accounts you use for expenses and invoices. But freelancers and contract workers often simplify things by just using their personal checking and savings accounts for income.

To make things clear for lenders, you should put your income and business expenses into a separate business account. Not only will this make it easier for lenders to quantify your income, but they can also use this information to see that your expenses are for helping your business rather than personal spending.

Timing is everything

There are a number of factors that go into choosing the right time to apply for a mortgage. Being self-employed only complicates the matter since your income might not be as steady as your average wage worker. You’ll want to commit to a mortgage at a time when you’ve had at least two consecutive years of good, reliable income. You’ll need to prove this with the aforementioned documents (bank statements, tax forms, etc.).

Part of this planning could be to avoid large business expenses in the two years leading up to your mortgage application. This isn’t always possible, of course, but it could be enough to boost your apparent income to get you approved for a better loan.

Seek specialized lenders

Some lenders are aware that there is a large portion of the country made up of self-employed workers and small business owners. They go out of their way to work with people who are self-employed so they can give them fair deals on their mortgages. To find specialized lenders, you’ll have to do some research online, but it could make all the difference when it comes to getting approved for the loan you’re looking for.

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