Should you choose to sell your home with the help of a listing agent, you’ll discuss a few issues prior to signing a listing agreement. One key factor, which is negotiable, is determining the length of time you want to list your home for sale. While your real estate agent might suggest a suitable time period for your listing, you have the final say and should choose the length of time that works best for your needs.
Comparing Time Frames
The most common listing lengths are 30 days, 90 days, six months or one year, but you can choose any time frame. However, realtors typically won’t take listings for less than 30 days and 90-day or six-month listings are the most common choices. Since your listing agreement is a legally binding contract, you’re legally bound to pay your real estate agent a commission for selling your home during the time frame you’ve chosen.
It’s wise to base part of your decision on the average number of days comparable homes in your area stayed on the market before they sold. For example, homes for sale in New Orleans spent an average of 68 days on the market in 2015, but took closer to 108 days in 2011, according to Crescent City Living. Using local days on market (DOM) data to learn more about current trends is a helpful tool in determining an appropriate time frame.
Merits of 30-Day Listings
If the home selling market in your area is particularly hot with houses snatched up within days of hitting the market, consider a 30-day listing. Although some real estate agents won’t like signing such a short agreement, it provides you with an out, if you’re unhappy with your realtor’s marketing efforts. For example, if equivalent homes are selling within the first couple of weeks and your home lingers for the full month, when your contract expires, you have the option to find a new agent.
Merits of 90-Day Listings
In an average market, listing homes for 90 days is a common choice. During the first month, your agent will likely schedule an open house and you should have several private viewings, if your home is priced appropriately. If your home doesn’t sell in the first 30 days, your agent may get feedback from prospective buyers to discover suggested improvements. You’ll discuss your sale price and overall property condition to decide whether any changes are warranted to get your home sold in the next 60 days.
Merits of Six-Month Listings
If the average DOM in your area has been exceeding 60 days, you’re likely in a buyer’s market and it’s probably going to require a longer listing time to get your home sold. One perk of having a 180-day listing agreement is it’s less likely to expire while your home is in escrow, which would require an extension. On the downside, if you aren’t satisfied with your agent’s performance after the first 90 days, you’re stuck with them for another 90. To eliminate this possibility, ask for a cancellation clause that allows you to break the contract after 90 days, if you’re unhappy. If an agent won’t agree to one, it could indicate a lack of confidence in their own ability to sell your home.
Merits of One-Year Listings
Signing a one year listing agreement isn’t the norm in most real estate sales and you normally wouldn’t want your home to take this long to sell. However, some properties that appeal to a limited number of buyers could take a year or even longer. This could include expensive estates, rural properties or any unique parcel of real estate. Extravagant vacation homes and private island properties are other instances where lengthy, and pricey, marketing might be required to attract the right buyer.
Mutually Protected Interests
As previously mentioned, a cancellation clause protects you from getting stuck with a less than stellar agent, but it also negates the overall importance of choosing a specific time frame. An exclusion clause protects you from having to pay the agent a commission should you decide to sell your home to someone you know and/or someone the agent didn’t find for you. Your agent may also ask for a protection clause for themselves. These usually last between 30 and 90 days after the contract expires and stipulate you must pay your agent’s commission in certain cases, like if you sell to a buyer they found.
Whatever time frame you choose, once this time expires, so does your real estate listing. Now, you must decide whether to relist with the same agent or a new one, or take your home off the market and try again at a later date. Before making your decision, review the potential reasons why your home didn’t sell, which helps you determine the best option.
Original article found at: http://realestate.nola.com/sellmyhome/2017/04/how_long_should_you_list_your.html