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DECIDING TO SELL
When deciding to sell your home, it helps to know whether you're in a
seller's market
with low inventory and rising prices, or a
buyer's market
with lots of houses for sale. It's also important to understand what kind of homes sell best in your area.
If you're not under pressure to sell, test your decision by considering factors such as:
·
Financial impact
It costs thousands of dollars to sell a property and relocate—often as much as 15 percent of the sales price of your home by the time you count the real estate commission, closing fees, and moving costs. The less
equity
you have in the house, the greater the financial hit. It pays to
run the numbers
before you sell.
·
Timing
Consider the timing of your sale relative to the market and to your home equity. A slow market may negatively affect your sale. And if your equity is low, you could end up bringing cash to the closing to pay off your lender. The more equity you have in your home, the better equipped you are to cover your sales costs.
·
Tax consequences
Though
capital gains tax
laws have relaxed to the point where most Americans don't have to pay tax on real estate profits, you will likely have to pay if you've lived in your home only a short time. Make sure you know
where you stand
.
PREPARE TO SELL
When preparing to sell your home, the best thing you can do is think of the house as a commodity. Try to separate yourself emotionally from your house and look at it through the eyes of a buyer.
Hire
an agent to handle the sale, then do whatever it takes to
put your home in its best condition.
Prepare for the sale by doing the following:
· *
Get a pre-sale inspection.
· *
Deal with disclosures.
· *
Make appropriate repairs.
· *
Neutralize your decor.
SET A PRICE
Your home's value is ultimately what a buyer is willing to pay at any given time. Your final list price may depend on many factors: If you want to sell quickly or you are in a buyer's market, you may decide to set your price lower than market value. On the other hand, if you're in a seller's market where multiple offers are common, you may want to set your price higher than market value.
To arrive at a price:
· *
Ask your agent
.
· *
Know how to read a comparative market analysis.
· *
Get an appraisal
.
ACCEPT AN OFFER
You may not have to wait long for your first offer. In most cases, however, you will wait anywhere from 30 to 60 days for an offer. This can be an emotional process, especially if offers come in far below your list price, or your home has been on the market for several months.
Remember:
· *
Don't rush negotiations.
· *
Decide on the lowest offer you'll accept
.
· *
Don't get personal
.
· *
Don't hesitate to counter
.
· *
Play fair.
CLOSE THE SALE
At this point, the buyer is busy with financing; until the sale closes, you are responsible for keeping your property in the same condition it was when the buyer saw it last. The closing date should be clearly specified in your sales contract, which should include deadlines for the buyer to sign off on contingencies. Make sure the buyer meets any deadlines you've set.
Be ready to deal with any problems that may crop up:
Problem:
Unsatisfactory home inspection
Solution:
If the fix is major, you may want to split the cost of the repair with the buyer, or give the buyer a cash credit at closing to cover the repair. If the fix is minor or you are selling in an active market, your sale might go through without any concessions on your part.
Problem:
Low appraisal
Solution:
Your deal could fall through if the buyer's appraisal comes in lower than the agreed-upon sales price and the lender refuses to issue a mortgage. Ask for another appraisal if you think the buyer's appraisal was wrong, or renegotiate your price. Another option is to offer
seller financing
for the dollar difference.
Preventive measure: Give the appraiser the most recent comparable sales from your neighborhood, and make sure your home is in top condition.
Problem:
Cloud on the title
Solution:
Title problems can take several forms, including unsatisfied liens against your property, delinquent taxes, and
encroachments
on the property line. In order to clear the title, you will have to pay any liens or delinquent taxes. Title companies are used to dealing with encroachment issues, which may be resolved with some kind of insurance policy.
Preventive measure:
Check your title before you sell and make sure it is clear.
Problem:
Buyer's remorse
Solution:
Occasionally, an uncertain buyer will decide to pull out of the deal regardless of the consequences. Try to work with the buyer's agent to determine the problem. You may be able to suggest a solution that reassures the buyer and rescues the deal. (If not, you may be able to keep the buyer's deposit.)
Preventive measure: Learn all you can about the buyer's motivation before you accept an offer. Also, be sure the sales contract allows you to keep the security deposit.
PREPARE TO MOVE
Once you've sold your home, you can proceed with your move and tie up the loose ends:
· *
Make a file.
· *
Bank your money.
· *
Close on your next house
.
· *
Send change-of-address notices.
· *
Switch utilities
.
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