How to avoid that "Price Reduced" banner - Empty Houses
Updated: Nov 30, 2020
You are an investment homeowner in 2020, and the thought of selling has crossed your mind so many times that you've finally decided to act on it when your current tenant gave early notice for whatever reason. It's a challenging time economically and the rental market is seeing high vacancy rates.
You have to sell. Luckily the interest rate is low, so you will probably not struggle to find a buyer.
But your tenants have moved out already and your property is empty (unfurnished), which might not count in your favour. Will your property sell for less because it is empty?
The short and unfortunate answer is 'Yes.' Empty homes sell for 6% less than furnished homes' - according to a study from the Appraisal Institute.
But why is this the case?
1. Buyers will think you're in a rush (and even if you are, they should not know it)
Buyers love a great deal, and they will look for any reason to push the price down as far as possible. If your home is empty, it signals that you're desperate (even if you're not), because you (or a tenant) is not living in it, which means you probably have to pay at least two bonds.
They might even offer to pay cash, usually even as little as 65% of your home's value, as they smell the desperation.
Solution: Don't ever come across desperate, get a Stager to arrange furniture.
2. Rooms look much smaller without furniture
Although this might not make sense, it is true because of perception. In order to measure or judge the size of something, our eyes need something in the background for scale or depth perception. Think of a picture you receive of a piece of wood - you have no idea how big it is until someone takes a photo of it next to a matchbox.
If the rooms in your house look smaller than they are because they're empty, it will put pressure on the home's value.
Solution: Get the right furniture to accentuate the room's potential.
3. Your empty-home photos will get lost online
Nowadays everyone searches for everything online. From clothes and furniture to cars and gardening tools. Homes are no different. And because the competition online has become so great, you really have to stand out from the rest if you want buyers to stop in their tracks and not scroll past your 'product'. Your first impression online is created with your pictures. Over 90% of homes are first discovered by buyers online - according to studies done by Realtor.com. If your home is unfurnished, they will scroll past it as quickly as they did past the other empty houses they saw that day.
Solution: Get your 'product' to look great by furnishing it well.
4. Don't let price be your marketing tool
Many sellers with empty homes end up having to lower their prices to make themselves stand out. If your home got lost in the online empty-homes-pit, you'll probably think that lowering your price might save you. Don't fall in the same pit that your house did.
Solution: Get a Stager to furnish your house. Get an agent's opinion on the price after it's been staged, and you won't need to consider the 'Price Reduced' banner. Use your staged photos for online marketing so that your 'product' can stand out from the rest.
5. People connect with Homes, not Houses If your house is empty, people will struggle to 'see' themselves living there. They won't be able to connect to the house as a home. People buy homes with their emotions. If you can sell the life, the dream, the possible memories they might have there, you've won.
Solution: Create a home that sells a certain lifestyle. Have a professional stager create this lifestyle for you.
6. Flaws become more obvious when the house is empty
Although Owners should always tell the truth in giving an account of any broken items in the house, some smaller scratches and dents or chips that accumulated over the years might give an overall negative impression as it is much more visible when the property is empty.
Solution: Accentuate the beautiful areas by using eye-cathing furniture. This will take the focus off these minor flaws. Do maintenance on the outside of the house. When the buyer comes for a viewing, they need to see you cared for and loved the home, and this is the first real-life impression he'll get.