How to Lose Money Selling Your Home
Copyright © 2023 by Tom Grooms
Tom Grooms is an independent author. The article is the sole opinion of the author and nonadvisory. Quotation of passages is permitted with proper acknowledgment of the author. All rights reserved.
How to Lose Money Selling Your Home
The most important thing you do is to underprice your home.
This is easily accomplished using property appraiser’s comps and realtor’s advice to lower your price. It doesn’t take a genius to be stupid.
What’s stealing your money after the 2008 housing collapse is the administration in Washington legislated mandatory guidelines that local property appraisers who know your housing market can no longer be used. The property appraisers must come from outside your housing market which means that they know nothing about the home values where you live.
It’s still that way today in many places, called wealth transfer from those who have worked and saved giving to those deadbeats who vote politically correct. Theft is a beautiful thing.
You should continue to be a good citizen and support home welfare by selling your home at a loss. The more money you lose, the greater your welfare contribution, and you can’t write it off your taxes.
If you are lucky enough to get a local property appraiser, your your appraisal may still be well below and under market value. They will use only local square foot baseline comps established in 2008 and suppressed increases each year.
The reason you want to accept this home square foot value is to help protect your property appraiser, so they don’t lose their license under threats from Washington in 2009 federal regulation guidelines. Your goodwill knows no bounds.
Buyer or Seller Market
The next thing you need to do is to determine if you are in a seller or buyer home market. Here is how you determine the current housing market condition.
You make the determination by using the Grooms Rule of 5 in my book My Little Business. Illogic makes sense when losing money selling your home.
If mortgage interest rates are below 5%, they are in favor of the buyer. So, you want to be the seller. Then there are more homes for sale and many sellers, so you want to be the seller.
If mortgage interest rates are above 5%, they are in favor of the seller, banks, financial lenders, and mortgage companies. So, you want to be the buyer. Then there are less homes for sale and few buyers, so you want to be the buyer.
Don’t be fooled into believing if mortgage interest rates are below 5%, you are in a seller’s market. If mortgage interest rates are above 5%, you are in a buyer’s market.
Golden Rule to Losing Money When Selling Your Home
The Golden Rule of losing money when selling your home is to remember all home square footage is equal.
This is the golden rule used by property appraisers and realtors. All square footage has the same value; therefore, therefore all square footage is equal.
This strongly endorses the belief that all homes are the same. All homes look alike; therefore, all men are the same and all women are the same.
You need to get onboard the politically correct bandwagon established in 2009. The lower you price your home and the more money you lose, the higher your chances of receiving an American Best Citizen Award.
You do want to be equal, don’t you? Being a capitalist and wanting more is selfish supporting principles of inequality.
There is no federal law, not under Fannie Mae or Freddie Mac, that requires an appraisal to sell or buy a home. There is no state law that requires an appraisal to sell or buy a home.
There is no local law that requires an appraisal to sell or buy a home. There is no law that requires an appraisal to sell or buy a home.
Be sure to spend the extra money for an appraisal that you pay for out of your own pocket. Then the lender has their piece of paper to roll your note to another for profit. Keep those loses mounting.
To Sell Your Home
There are certain things you can do yourself to sell your home and lose more money at the same time.
Whatever you do, don’t decide on your own what is your listing price.
Don’t think like a homeowner, think like an appraiser, realtor, salesperson.
Try to wait till the spring, never in the winter months, to sell your home. So, don’t put it on the market when you are ready.
Forget putting stuff in storage and staging your home. It’s a waste of money in most cases. Let a home buyer see your home as it is actually lived in.
Don’t use a real estate agent to list and sell your home on MLS. Don’t pay an extra 6% commission for listing your own home on MLS.
Take your own pictures of your home and posting them on Facebook marketplace. Don’t clutter your yard with a For Sale sign.
Let your property home appraisal dictate the listing price of your home. Be responsible for going on the MLS multi-listing service for your home area to see the lowest prices of homes.
The lower your price, the more prospects and reach of the largest number of buyers. Isn’t this fun.
Paying all the closing costs for full services is best, instead of hiring your own real estate attorney to help with the seller’s contract and escrow process.
Don’t expect your asking price, it’s important to be ready to give away the farm.
Hide all the major problems and damage possible to your home. If possible don’t allow a buyer home inspection of your home … duct tape works great.
If the buyer finds problems and damage, lower your price significantly to increase the loss of your home.
Never accept cash from a buyer. You want the IRS to have their fair share.
Don’t get caught having to pay capital gains tax. Make sure you don’t have a profit, only a loss.
After the first year trying to sell your own home yourself, this is the time to go with a realtor, since you didn’t learn anything here.
It’s best to sell your own home in one year or less after taking ownership. This allows you the privilege of paying short-term capital gains as ordinary income to maximize your contribution while giving a helping hand to feed all those poor politicians in the federal government.
If you forget and its past one year, not two, after taking ownership, it’s okay. You are taxed at long-term capital gains for people of higher incomes which is considered as IRS charity.
You can be a stingy American and wait to sell your own home after two years from taking ownership. You won’t pay any capital gains taxes on the first $250,000 profit if single or $500,000 if married and filing jointly.
The three most helpful things you can do in life for yourself, as often as possible, is getting a divorce, buying and selling your home.
The more times you buy and sell your home, you can add about $20,000 extra each time in closing costs to your debt, thus supporting the national economy.
Whatever you do, don’t try to negotiate the 6% realtor commission. The realtor has to make a living, even if they make more off the sale of your home than you.
Love all those itemized closing costs. They are there for your protection. So, don’t try to eliminate any, understand any, or negotiate any costs.
Don’t worry about all the moving costs. They add up and are just part of the loss when selling your home.
It’s best to sell your home during the first 5-years of your 30-year mortgage. It helps the profits of the mortgage company to sell during this time since your loan is front-loaded structured with the highest interest payments and any equity goes straight into the lender’s pocket.
Don’t ever list your home sale contract “as-is”. This is to protect the buyer, giving you the seller maximum liability.
Any home improvements and upgrades is a waste of money. Thus, giving the buyer an extra 5%-20% in market value. Let the new buyer spend more money on the home to improve its value.
Real estate home values never go down. So, don’t worry about the location or debt owed on the home. You can’t lose money selling your home.
The longer your home for sale sits on the market the better. This makes the buyers hungry to offer a higher price for your home or get into a bidding war.
It’s bad to hold an open house. You don’t want strangers going through all your stuff.
Agree upfront to pay for a home warranty for the buyer. This will give them confidence in fleecing you.
You want to always close at the end of the month. This assures you, you will lose more money and pay the maximum interest for the whole month without ownership and occupation of the property.
Rule of thumb is, it’s best to hire the first real estate agent you talk with. This keeps you from getting confused with highest real estate agent performers.
Expand the size of your garage and put in a swimming pool right before you list your home for sale. Garages and swimming pools are never counted in property values or square footage of a home. This is why it’s important to charge extra for home improvements or they are a free gift to the buyer and additional profit loss to you.
You’re just getting better and better. Keep it up.
Spending money out of savings to put on a fresh coat of neutral paint before listing your home doesn’t help to sell your home. Don’t have professional cleaning of the carpet and home since everyone has dogs and cats and sometimes smoke.
It’s silly putting fresh flowers and decorating the entry for a first impression. Stop spending money on cutting the grass and manicuring the lawn, it will grow back anyway.
If you declutter your property, your neighbors will know you are selling. Those tires and cars in front of your home are landmarks, maybe even historical markers.
You don’t want to have to make a contingent counteroffer. It’s easier to list your house well below market value in the beginning.
Now You Are The Expert on How to Lose Money Selling Your Home
Why pay money when you can lose more profit?
Set your listing price below what you owe, don’t budge, and not let anyone talk you out of it.