Selling your home takes time, planning and, yes, money, invested upfront, to maximize how much you’ll make when your sale closes. Fortunately, there are strategies to boost your bottom line.
Whether you’re trading up, downsizing, relocating or simply scratching an itch to move, here are these 12 things you should consider for selling your house for the most money:
1. Set the right price
One of the most important factors in your home sale is setting the right price. But what, and who determines what’s right?
You probably have a general idea of what your home is worth (thanks, tax appraisals) within a ballpark. The hard part lies in figuring out whether to sell directly to your friend’s cousin for $180,000, or whether you should list on the open market and see if you can match your neighbor’s $195,000 ask (he redid the basement last year, but you re-insulated the attic).
The key is doing your homework to ensure you’re hitting the market sweet spot. Too low, and some buyers might assume the home hides problems. Too high, and buyers will keep looking. As we’ve explained in the post on how to determine the value of your home, we recommend focussing on figuring out the “comps” for your house — comparable properties, and what they sold for.
Homeowners can do some of this legwork themselves. Consider the size of homes in your area and their features. If your neighbor’s home sold for $250,000, but it’s twice the size of yours, that’s not a comparable property, for example. You might consider homes in a similar commute radius as yours, or a similar area of walkability, as well as size and general features, from a pool to a two-car garage.
And be realistic. Don’t expect to reap 100 percent of any renovation costs — you made the home livable for yourself for a few years (or decades), and there’s value in that.
Also, talk with local real estate agents who specialize in your area. They will have the detailed data at their fingertips.
2. Choose the right time to sell
Home sales typically ebb and flow with the seasons. Spring brings the most buyers into the market because more people want to move during the summer when the days are longer, the weather warmer and children out of school. Since it normally takes a few months to close a transaction, buyers who sign a deal in spring are well-positioned to move in summer. Though some buyers shop for a home in fall or winter, those seasons are less popular, and sales usually are slower.
Different markets can have slightly different patterns of seasonality. In Phoenix, for example, sales spike in March, which is the beginning of the spring season there. Sales then peak in May and continue strong through the hot summer months. By signing a contract in spring with a few months to close, buyers are well-positioned to move over the summer.
Sales in Phoenix fall off only moderately in fall and winter since the area’s off-season weather is so mild. Timing your sale to maximize your home’s exposure to the most potential buyers can help you sell for more money.
3. Determine how you’re going to sell
Most homeowners hire a real estate agent to sell their home. The agent handles marketing the home, negotiating with the buyer’s agent and more. In exchange for the agent’s services, the seller pays a commission that is shared with the buyer’s agent.
Hiring an agent isn’t the only way to sell your home. You could try to sell it yourself as a for-sale-by-owner or FSBO. With this approach, it’s on you to do everything necessary to complete the sale. The conventional wisdom is that FSBOs tend to underprice their home and sell for less money since they don’t have an agent’s marketing power. According to a study by the National Association of Realtors, FSBOs are losing about 16 percent of the sales price compared with agent-assisted homes.
You could also consider to sell your home to a direct buyer like Opendoor. At Opendoor, we take a single service charge to provide you with a hassle-free sales process without listing, showings, and months of stress. You’re in complete control of your moving timeline, and choose your own closing date.
4. Understand your sales costs
Selling a home is expensive. It’s not unusual for costs to consume as much as 10% of your home’s sale price. The biggest chunk, usually 6%, is your realty broker’s commission. Another 1% typically covers your closing costs, such as escrow or settlement services or transfer taxes.
Expenses that make up the other 3% could include:
- Staging fees to make your home more appealing to buyers.
- Repair costs and credits to compensate the buyer for your home’s flaws and defects.
- Concessions, such as inspection fees or closing costs, that you might agree to pay to help the buyer.
- Holding costs, such as property taxes, utilities and insurance, that you’ll continue to pay until your sale closes.
5. Complete renovations
Making improvements to your home could help you sell it for more money, but you should select projects with care.
Most renovations don’t return as much as they cost, according to Remodeling magazine’s 2017 Cost Versus Value Report, which analyzed renovation projects in nine U.S. regions.
In the Mountain region, which included Phoenix and Las Vegas, not one of 19 different remodeling projects returned 100% of its mid-range cost on resale. The best performer was fiberglass attic insulation, which returned 93.4%.
In the West South Central region, which included several cities in Texas, the fiberglass attic insulation project was again the winner, returning 108.4% of its mid-range cost. Second on the list, manufactured stone veneer, recouped 96.1%.
In the South Atlantic region, including Atlanta, the fiberglass attic insulation and manufactured stone veneer projects returned 123.3% and 92.5%, respectively.
These statistics are averages. Certain renovations might be more valuable in your market. If all the homes but yours have ceiling fans, for example, you might consider installing them to make your home more competitive on the market.
6. Depersonalize and declutter
Preparing your home for sale is among the most important things you can do to maximize its value and your return on your investment. Decluttering, cleaning and depersonalizing your home can make it much more attractive to prospective buyers. Buyers who fall in love with your home will make higher offers than buyers who simply sort of like your home. Your goal is to go for the love.
For decluttering, sort through your cupboards, closets, and garage, dividing your belongings into things to keep, trash, donate or gift away, or put in storage. You might need to remove up to half of your furniture and belongings before putting your home on the market.
Cleaning should involve everything in your home, inside and outside. Cleanliness suggests your home has been well-maintained. Depersonalizing means packing up anything you wouldn’t find in a bland upscale hotel room, such as artwork, religious or ethnic items or sports memorabilia. Your goal is to create a neutral, spacious, inoffensive home where buyers can imagine themselves living.
7. Hire a professional stager
When it comes to selling your home, the first impression may be the only impression. That’s because buyers who don’t like your home at first sight, which these days is probably online, won’t take the time to see it in person. If they don’t see it in person, they’re unlikely to make an offer.
One way to make a positive first impression is to hire a professional stager. Staging involves arranging your furniture and home accessories to evoke positive emotions in prospective buyers. If your furnishings are sparse, outdated, or don’t fit your home well, a stager can bring in fresh artwork, lamps, knickknacks, even tables and chairs, to make your home more appealing. Staging can make a dramatic difference. Done right, it’s often worth the cost for sellers.
8. Improve your home’s curb appeal
If buyers don’t like the exterior, they might not go inside. To bring them in, make sure your home has plenty of curb appeal. Paint the front of your home, clean your front windows, sweep your front porch and walkway, mow your front lawn and add bowls of colorful flowers to the front steps. Remove any personal items or clutter on your driveway or front porch.
Other curb-appeal tips include:
- Pressure wash your driveway and siding
- Install a new mailbox
- Polish or replace your house numbers
- Update your front-door hinges and hardware
- If your front door mat is worn or dirty, replace it with a new one
- Turn on exterior lights
- Stage your front porch for the season
For more in-depth information on how to make your house more appealing to buyers, check out our post with experts tips to increase the value of your home.
9. Conceal your critters
Some people don’t like pets or don’t want a home that has had a pet in residence — pet odors, smells, or an animal sniffing around them while they tour the home can be a turnoff. Traces of animals could also give a less-than-perfect home view experience — imagine opening a bathroom door to find Fido on the other side. Surprise! To maximize the bids you’ll receive, you’ll need to take steps to minimize your pet’s presence.
Move your pet’s litter box, toys, bed, cage, and water and food bowls out of sight. Have rugs and upholstered furniture professionally cleaned or spray them with a pet-specific deodorizer. Deep clean your bedding, drapes and anything else made of fabric to remove pet hair and odors.
Repair any minor damage, such as scratched furniture, that could tip off buyers to your pet’s occupancy. Consider boarding your pets, or recruit a friend or family member to help you watch or walk your pets during showings or open houses.
10. Always be ready to show your house to potential buyers
Once you list your home, it should be ready to show at any time. Ready to show means every room is clean and uncluttered at all times. Don’t pile dirty dishes in the sink or leave dirty towels or clothes on the floor. Keep sensitive financial documents, small valuables and prescription medicines in storage or with a trusted friend or family member.
Have a last-minute go-bag that you can use to gather up unsightly or personal items and stash them in your car when you leave. Be prepared to make a quick exit in the morning, evening and on weekends.
11. Review buyers’ offers
It’s natural to want to grab the highest bid you receive for your home, especially if it’s an outlier that’s significantly more than your asking price. But don’t jump without first reviewing the terms.
Some factors to consider:
- Requirements on what the buyer wants included in the sale, such as appliances or furniture. Anything that’s physically attached to the house is usually included in the sale. But major appliances, furniture, wall hangings, and other items could be negotiable. Most sellers don’t include their furniture, but some include appliances, in part because they can be difficult to move or put into storage.
- How much earnest money the buyer is willing to risk. Earnest money, sometimes called a deposit, is an amount the buyer puts into the deal soon after signing the purchase contract. If the buyer walks away, you might be able to keep that money. A larger deposit could mean the buyer is more serious about the deal.
- Whether the buyer has sufficient cash for a down payment or the full purchase price.
- Whether the buyer has a pre-qualification or pre-approval letter for financing. A letter from a reputable lender shows the buyer has taken steps to secure a mortgage and may be better qualified—and thus more likely to close the deal—than a buyer who doesn’t have such a letter.
- Whether the buyer is asking for seller-paid closing costs or other concessions, as these can end up costing you, the sellers, money.
If the buyer plans to obtain a mortgage, review the sales prices of recently sold homes that are comparable to yours. Will your home appraise with a high enough valuation to support the offered price? If the lender’s appraiser says your home isn’t worth that much, you might have to have to accept a lower price or put your home back on the market.
Once you’ve reviewed all offers, it’s time to choose which of them to negotiate. Your goal is to improve the offers to get more of what you want, whether that’s a higher price, fewer seller concessions, a different closing date or more earnest money. You can counter one or more offers before you decide which to accept.
The highest price might emerge as the best offer. But if it doesn’t include a mortgage pre-approval letter, has a closing date doesn’t fit your timeline, includes personal property you’re unwilling to sell, or contains other terms you don’t want to accept, you might choose a lower offer that better meets your needs.
Maximizing your gain when you put your home on the market impacts your long-term financial security. Committing to follow these steps to selling your house could mean a bigger payoff, and a better opportunity to increase your wealth.
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