When you’re gearing up to sell your home, you’re bound to have quite a few questions. Asking the right questions at the beginning will only help you as you prepare to navigate the process. Here are some of the most frequent questions we receive.
- What is the best time of year to sell?
Properties sell year round, but the time of year you choose to sell can make a difference in the amount of time it takes and the final selling price. In general, the real estate market picks up around February and typically tapers off sometime around July or August. Summer tends to be the busiest time for moving since school is out and buyers may be looking to relocate before their children start the new school year. The market usually slows down around November in time for the holidays.If you have the luxury of waiting for the right moment to sell, it makes the most sense to do so when the market is “hot” — which is also referred to as a seller’s market. Whether a market is hot or cold can be extremely dependent on where you live, and a few other important conditions. You can determine the market’s temperature by a number of factors, including low mortgage interest rates, a healthy local economy and a surge in home sales.In addition to the condition of your local real estate market, you should also take your personal situation into consideration. Here are some factors that indicate it’s a good time to sell:
- You have paid off your mortgage
- You’ve got equity in your current home
- Your current home no longer fits your lifestyle
- You are in good financial shape.
- How much is my house worth?
The best way to determine how much your house is worth is by looking at the sale prices of recently sold homes in your neighborhood that are similar to yours. This is the primary method used by real estate agents to determine home values. Sale prices for homes are public and can be viewed on the multiple listing services (MLS), a large database of home listings.
When you’re viewing these comparable homes (or “comps”, as they’re referred to by agents) be sure to weigh things like the number of bedrooms and bathrooms, the square footage of the home, and any unique features. By comparing your home’s characteristics to similar sold homes, you can make some inferences about how much your home is worth. If your home has fewer bathrooms, for instance, it may sell for slightly less than the comp. If you’re working with an agent, they can usually provide you an idea of the value of your home based on the market and home prices in your neighborhood. Also, check our in-depth post on how to determine the value of your home.
- How much does it really cost to sell my home?
Selling your home can be an expensive business. With so many outside factors involved, it’s not simply a case of naming a price and pocketing what you’re given. However, with some preparation, you should know all the costs involved and can budget accordingly.
We have covered the total cost of selling a home in more details in another post, but here is a summary of the most important costs:
- Realtor’s commission (6%)
- Staging and home preparation costs (1%)
- Seller concessions (1-3% )
- Repair costs (determined based on inspection)
- Home ownership and overlap costs (1%)
- Closing costs (1-3%)
In total, you can expect the total cost to add up to an average of 10% of the sale price.
- Should I make repairs?
It’s never fun to repair items in a house right before you move out, but depending on the circumstances, it can be a good idea – specifically cosmetic repairs that might help to increase the value of your home. As a seller, you’ll be required to disclose any known issues to buyers as a material defect. You aren’t required to repair everything — you simply have to price the home appropriately based on any defects.
Expensive repairs like fixing an HVAC unit or getting a pool back in working condition can be a deal breaker for buyers looking to find a move-in ready home. Minor repairs (as mentioned above) can help leave a positive impression on buyers — whether it’s repairing a loose baseboard or patching up a hole in the wall. Whatever you decide to do, remember that repairs can always be negotiated with the buyer.
- How long will it take to sell my home?
According to the National Association of Realtors (NAR), the median number of days a home in the U.S. sat on the market hit a new low of 29 days in April 2017. That’s the national average, and the number of days a home is on the market before it sells varies widely by location. While the average house in San Francisco will find a host of prospective buyers the moment it goes on the market, a house in Mesa, Arizona is on the market at average for 75 days, according to Altos Research.
The time it will take to complete a home sale is dependent on your location, and also on the price and the condition of your home. Do you own research, or reach out to a local real estate agent for his assessment.
- Why should I use a real estate agent? And how can I find a realtor that I can trust?You might want to consider working with an agent when the home you plan to sell is located in a slow market – or if you simply don’t have the knowledge or time needed to take care of all aspects of the home selling process. With a good seller agent, you will not only have access to the most up-to-date information about your neighborhood, but also get an expert who will guide you through the nerve-wracking journey of finding the right buyer for your house, from home valuation, to advertising to negotiation and closing. If you want peace of mind and choose to work with a full-service real estate agent, he will handle inspections, repairs, online listings, showings and legal docs.
In order to find an agent you can trust, ask your friends, family, and neighbors for referrals. Additionally, do some research, look at local listings, and check out the leading agencies in your city or area including their licenses, their experience, and customer satisfaction scores. Schedule appointments with your top candidates and interview them, including all the questions that are important to you.
If the agent calls himself a Realtor with a capital “R,” that means he is a member of the National Association of Realtors. By hiring a Realtor, you get an agent who formally pledges to support the association’s code of ethics. Check out their website to find a expert for your neighborhood.
- How much commission does a real estate agent charge?
As a seller, it’s usually your responsibility to pay the commission that is split between the listing agent and the buyer’s agent. There is no official commission rate for real estate agents, and these rates are entirely negotiable.In most areas, 6% of the purchase price of the house is the widely accepted rate for real estate agents, though there are certainly agents who will ask for more and agents who will ask for less. That means if you’re selling your home for $200,000, you’ll usually owe around $12,000 in fees.
- How does the home inspection work?
An inspection of the home comes after you’ve received an offer, but before closing. The inspection is requested by the buyer to give them a clear idea of the quality of the home and expose any potential issues before the sale is binding. The inspector will be a third-party contractor who provides an inspection report to the buyer. As a seller, your job is to provide the inspector access to the home. Your agent or the inspector should be able to provide you with a checklist of items to have ready in advance for the inspector. Inspections can last anywhere from 3 to 5 hours.
- What will I need to leave behind in the house after it’s sold?
Sellers are expected to leave behind any fixtures. These are things that are affixed to the house or landscaping in some way. For example, ceiling fans would be considered fixtures, while potted plants would not. To avoid any misunderstandings or conflicts, you should be clear about what will stay and what will go in your contract with the buyer.
- My house has been listed for months with no offers. What should I do?
One of the top reasons why a home is not receiving offers is that it is overpriced for the market. Your first order of business should be to carefully study the sale prices of nearby similar homes and adjust your price accordingly. Once you’ve done that, you’ll want to walk through the house and try to identify any cosmetic or functional defects that could be deterring potential buyers. Consider fixing these issues, since they can make a buyer feel that the home is higher quality. Beyond that, you’ll want to make sure the house is getting the exposure it deserves through the MLS or in any advertising channels like online ads, and even with a-frame signage. If none of this helps, you may want to consider taking the home off the market until it’s a better time to sell.
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