As owning
a home is such a personal
endeavour, chances are you’re
caught up in a host of emotions
while selling it. You may
be looking forward to moving
up to a new dream house or
facing the uncertainty of
a major move across country.
You may be reluctant to leave
your memories behind or eager
to start new adventures. Through
all of these emotions, there
are still some crucial moving
factor that need addressed.
Keep in mind the following
considerations to help the
whole process go more smoothly.
Time
= Money It’s
a good idea to place your
home on the market as far
in advance as possible of
purchasing a new one. If you
find a new home first and
then try to sell your present
home, you may wind up with
two mortgages. If this does
happen, ask your Real Estate
Agent or banker about a bridge
loan to help you make the
double payments. Lenders use
the same criteria for offering
bridge loans as they use for
mortgages. Should you qualify
for a bridge loan, beware
of the expense; during the
term of the loan you must
continue to pay both mortgages.
Shop around for the best terms.
Keep in
mind that when people move,
sell and buy, there usually
is a domino effect. Closing
and moving dates have to be
coordinated, and the more
firmly everyone commits to
a window of dates and sticks
to them, the better for all
involved. Put all agreements
about dates in writing, and
protect yourself by negotiating
financial penalties for failure
to comply.
Check
Your Curb Appeal There
is really only one chance
to make a first impression.
A home that’s visually appealing
and in good condition will
attract potential buyers driving
down the street. Use this
checklist to view your property
through an outsider’s eyes.
Is the landscaping well
maintained?
Are there cracks or grass
in the foundation or walkways?
Does the driveway need
resurfacing or cleaned?
Are the eavestrough, chimney
and walls in good condition?
Do the window casings,
shutters, siding or doors
need painting?
Is household trash and
clutter stored out of sight?
Are landscaping tools
properly stored?
Is the garage door closed?
On
the Inside
Your
home's curb side appeal will
lure potential buyers inside,
where you have to live up to
their expectations. Fortunately,
there are plenty of improvements
you can make to your home’s
interior without spending a
lot of money. Cleaning is your
number one essential task. Your
windows, floors and bathroom
tiles should sparkle. Make sure
you have clean heating and air
conditioning filters. Shampoo
dirty carpets, clean tubs and
showers, repair dripping faucets
and oil squeaky doors. Keep
your home neat, clean and well
kept at all times. Although
it may not seem fair, a buyer
may make their decision, whether
or not to purchase, based on
a whole lot of variables.
Remove unnecessary
clutter from all major storage
areas, and clean up the extra
clutter. Also remove any items
that some may deem to be offensive.
Consider putting some things
into storage to create more
room. If a room needs a fresh
coat of paint, use a neutral
off-white. Think, too, about
how your home smells. You may
be used to the smell of a pet
or cigarettes, but such odors
can turn-off others. Set a mood
for the buyer. Place scented
potpourri around the house or,
on the day you’re expecting
a potential buyer, or pop in
a batch of cookies into the
oven for a welcoming aroma.
Finally, be certain to remove
valuables such as jewelry and
other items from view. It might
be wise to put these items in
a safe deposit box before showing
your home.
Minor cosmetic
changes do not have to be
expensive. In fact, costly
home improvements do not necessarily
offer a good return on your
investment when you sell.
It’s attention to the basics—anything
that says “we care about this
home”—will help you get the
price you want.
Go
It Alone--or Choose an Agent?
Some
homeowners decide to sell
their homes themselves in
order to save the commission
charged by an agent. The commission
rate may vary, depending on
where you live or what agency
you choose, but it is generally
upwards of 5%. However, handling
your own sale means you will
be responsible for placing
ads, answering phones and
showing your home. What’s
more, buyers who know you
are saving on an agent’s commission
may offer less for your home,
wiping out the financial incentive
to do it all yourself.
A Real
Estate Agent probably knows
a lot more about the business
of selling a home than you
do. Here are some of the advantages
professional agents offer:
The
Agent Advantage
They will help you
set a reasonable,
yet competitive price
for your home.
They will promote
your home to other
agents and list your
property in multiple
listing services.
Your home will get
exposure to all registered
agents, one of whom
may have the perfect
buyer.
They will create,
pay for and place
advertising for you.
They
will schedule convenient
appointments to show
your home, even when
you are not there.
They
are excellent at spotting
serious offers from
credited buyers.
They
can refer you to sources
for insurance, inspections,
legal counsel and
financing.
They
will help you negotiate
with the buyer.
They
can make suggestions
to help make your
home more appealing
to a potential buyer.
If
you do decide to sell through
an agent, ask around for referrals.
Shop around for an agent that
you get along with, and one
who you feel will be able
to properly showcase your
home. Taking a walk through
your home with an agent should
give you a feel for how that
person will handle prospective
buyers. Ask prospective agents
how they plan to market your
home. Don’t sign with an agent
just because he or she suggests
the highest asking price.
Negotiate the broker’s commission
prior to listing your home,
and sign for a limited period
of time—usually three to six
months.
The
Fine Line As
anyone would, you want the
top dollar for your home.
But, at the same time, you
don’t want to scare off potential
buyers with an outrageous
price tag. Setting a high
price may cause your property
to sit on the market for months.
Reducing your asking price
later on may lead buyers to
wonder if there is something
wrong with your home. Here
are some of the factors to
consider when walking the
line between offensively pricey
and suspiciously low:
Extra Features- Spa, Fireplace,
Central Air, Central Vac,
etc.
To determine
the value of your home, you
probably will want the advice
of a real estate agent or
appraiser. Ask an agent to
prepare a market analysis
for you, showing the recent
selling prices of three neighborhood
properties comparable to your
own. The agent can help you
adjust for the unique features
of your own property.
Legitimate
offers from legitimate Buyers
Either
you or your agent will want
to quickly weed out potential
buyers who cannot realistically
afford to purchase your home.
Here are some crucial factors
in telling if he offer will
be a serious bid, or if the
bidders will no be able to
finance your home.
Debt and credit history
of the potential buyer.
The current income and
employment of the potential
buyer.
The current cash position
and availability of a down
payment
The length of time the
buyer needs before closing
on your home
How interested the buyer
appears to be in your home
versus others
Do they have legal representation.
When selling
your home—particularly if
you are selling on your own—it’s
a good idea to be represented
by an attorney. Look for an
attorney with expertise in
real estate transactions.
When a potential buyer puts
an offer in writing and you
accept it, the signed acceptance
becomes the sales contract.
Your attorney will be present
at the actual closing to protect
your interests and can assist
you with the following elements
of a
sales contract:
The sale price
What is included in the
sale price -- draperies,
carpeting, light fixtures,
heating oil, etc. The amount
of the down payment
The date of settlement
and possession date Contingencies
to the sale--inspections
(e.g. structural, lead-based
paint, radon), required
improvements, legal review
of the contract by the buyer's
or seller's attorney, etc.
The amount and length
of the mortgage loan, interest
rate and time limits to
secure the loan
Determining which closing
costs are to be paid by
the buyer and which by the
seller
Tax Implications
Oh,
Mr. Taxman...
Selling
a home can have a major impact
on your tax returns. Check
with your tax consultant on
the factors that may affect
taxes resulting from the sale
of your home. For example:
Whether you purchased
the home or acquired it
by gift or inheritance
Whether you used your
home partly for business
or boarding
Costs associated with
selling your home
Home improvements or additions,
which may help to offset
capital gains
