Selling your home
So you are selling your home, or at least you are thinking about selling your home. So what’s next? The following information will guide you through the process of selling your home for the highest price possible.
Expect great service from your realtor. Hire a professional. Would you go to your mechanic for financial planning? Would you go to your financial adviser for healthcare? When you decide to sell your home, hire a professional and take advantage of their knowledge, experience and professionalism. I expect comprehensive, high-quality service when I hire someone and you should expect the same. If you chose to work with me, and I hope you do, you can expect me to:
- Help you determine the asking price.
- Extensively market your home in order to maximize its exposure and with your input construct the best possible marketing strategy for your property.
- Offer proven advice on how to prepare and show your property so you get top market value for it.
- Regularly communicate with you to keep you fully informed of everything they do to sell your home.
- Provide feedback from all showings and open houses.
- Update you on both real estate and market changes that could affect your property’s sale.
- Help pre-qualify buyers.
- Promptly present and evaluate each offer with you.
- Negotiate the highest possible price and best terms for you.
- Manage contractual, title and transaction details while keeping you fully updated.
- Ensure the critical items are “signed, sealed and delivered” on closing day.
Prepare your home for maximum appeal to accommodate the widest variety of buyers. First impressions are critical. You will find all types, but in general buyers prefer homes that are well-maintained, clean and clutter free. Depending on your home’s condition, there are three kinds of improvements that will impress buyers and help you sell for top market value: renovations, upgrades and repairs, reorganization and maintenance.
- Renovations – Focus on the “right” renovations, those that will improve the overall impression and value of the property. Kitchens, bathrooms and energy efficient improvements will have the biggest impact. Be careful not to over renovate.
- Small Upgrades and Repairs – If you want to get top dollar you might need to make some minor upgrades.
- Exterior Improvements
- Fix or replace anything damaged or worn (gutters, screens, lights, etc.)
- Touch up the paint, especially the front door.
- Fix doorbells, make sure screen doors operate freely, oil squeaking hinges, etc.
- New welcome mat outside the front door.
- Potted plants beside the front door are a nice touch.
- Interior Improvements
- Brighten interiors with a fresh coat of paint. Light neutral colors will accommodate the greatest number of buyers.
- Fix or replace any cracked tiles, stained or missing grout, loose door knobs, etc.
- Shampoo carpets and rugs and/or replace if necessary.
- Add closet organizers or shelving to make closets more functional and spacious looking.
- Buy the furniture you planned for your new house. The latest furniture always spices up a room.
- Exterior Improvements
- Reorganize and Maintenance – Similar to repairs, basic reorganization and maintenance tasks are “must-dos”. The will help to improve your home’s curb appeal.
- Mow the lawn, trim hedges and shrubs, weed and edge gardens, perhaps add fresh mulch.
- Power wash the driveway, roof and lanai.
- Remove any debris or litter.
- Clean off your outdoor furniture and remove any in poor repair.
- Clean out your garage, an organized garage always seems to impress.
- Clean your pool and make sure it is functioning properly.
- Clean and tidy the entrance.
- Create the feeling of space by storing all excess furniture, less is more.
- Remove from closets, cabinets and shelves any clothes and other items you won’t need until after you move. Pre-pack and store as much as possible.
- Thoroughly clean everything in and out of sight.
- Remove all odors, but be careful not to use overly aggressive air fresheners, potpourri or candles, less is more here too.
Clutter-free homes typically seem brighter, more spacious, cleaner and indicate they have been well maintained.
Strategically pricing your home to get top market value. This is one of the most challenging aspects of selling your home. You need to balance between setting the price too low where it attracts too much interest and setting the price too high which discourages people from even looking. Ultimately, your home’s value will be determined by what the market will bear at any given time. Keep the following in mind when you are working with your realtor to determine your home’s true market value:
- Try to be impartial. Unfortunately, the current market finds no relevance to what was previously paid, high or low. Various features will be valuable to various people and what’s important to some may or may not be important to all.
- Remember why you are selling. Do you want to or need to sell? Shorter or immediate timelines often result in capturing less money than what the market would offer typically with more time.
- Research online and in person. This is where your realtor can be a huge help with the latest closed sales data for your neighborhood as well as a comparison of other homes for sale in your area (CMA).
In general, reviewing what has worked in your area and what hasn’t will help you to strategically price, position and stage your home so that it sells for top dollar in a reasonable time frame, with the least amount of inconvenience for you.
- Price it right from the get go. Homes generally attract the most interest and activity among buyers during the second to fifth week after your home has been listed. Beyond five weeks your home will be viewed as a stale listing. As a result, there will be less market buzz, less showings, less offers and less likelihood that you’ll get your price. This is why it is critical you price your home right from the very beginning.
- The downside of overpricing your home. While entering the market high, then reducing the price may sound like a good strategy, the statistics say otherwise. Statistics show sellers who overprice their homes even just 10% above market value and then reduce their price one or more times often end up getting less than they would have if they’d priced it realistically from the start. Why? Less showings which means less buyers looking at your home and fewer agents will show the home if it’s overpriced and ultimately fewer offers.
- Oops, I overpriced my home, now what? Take your home off the market for a short period of time and make some improvements to the home. You will then be able to relist your property showcasing the improvements.
Bottom line: Realistic pricing IS strategic pricing! If you price your home realistically from the beginning you’ll attract more buyers and more agents and maximize your opportunity to sell your home when your listing is new to the market.
Effectively marketing your home. Selling your home includes home preparation, pricing, presentation, negotiation as well as strategic advertising and networking. An experienced Realtor has the knowledge, expertise and resources to implement a plan that will effectively coordinate all of these activities to maximize your home’s market exposure. Maximum marketing equals maximum buyers equals maximum opportunities for offers equals maximum price. This is the recipe for greatest possible price in the least amount of time.
- How do buyers find out about homes for sale? To market your property effectively, you need to know where most qualified buyers come from. In today’s day and age it’s the internet (including REALTOR.com, Realtor websites, social media, blogs, etc.) as well as direct contact with Realtors. Studies show as high as 94% of homes are sold as a result of the internet and real estate agents. Other sources of advertising include yard signs, open houses, newspaper and real estate magazine ads and television. In our area many communities do no allow home signs, so advertising via the internet is even more important. The internet has revolutionized the real estate industry. What are buyers looking for on the internet?
- 99% – Property photos (lots of them)
- 99% – Detailed information about properties for sale
- 88% – Virtual tours
- 80% – Real estate agent contact information
- 78% – Interactive maps
To ensure your property is marketed to its fullest potential, it is critical your Realtor has a significant presence on the internet.
- Market your community as well as your home. Industry surveys have repeatedly found that neighborhood quality is THE most important reason why home buyers choose where to live. Be sure to highlight the benefits of your community’s amenities – proximity to shopping, restaurants, schools as well as other benefits that impact the lifestyle.
- Comprehensive approach to showcasing your home and community in the marketplace. While the internet is the real estate information source of choice, if you want to maximize the number of serious buyers, showings and offers you get it is necessary to employ a broad spectrum of advertising in a coordinated manner. When selling your home your Realtor will have a wide range of options to maximize your property’s exposure, many of which you would not have access to on your own. Some of these options include:
- Multiple Listing Service (MLS)
- Notifying the areas top agents
- Notifying all potential buyers and referral sources in their database
- Company website (Downingfrye.com)
- Personal website (NaplesGolfGuy.com)
- Social media sites like Facebook, Twitter, Google+, LinkedIn and Instagram
- Local Real Estate Newspapers and Publications
- Direct email and mail campaigns
- Open houses
- For Sale Sign (If allowed)
Setting the stage to sell – aim for perfect open houses and showings. I mentioned this before, but it bears repeating, first impressions are critical. Be sure your property looks its very best for showings and open houses.
- Proven Tips for Showing Your Home
- Ideally, you should be absent so buyers feel comfortable making comments.
- Make sure your home highlight sheets are right near the front door in plain view.
- Open all drapes and shades during the day to let in as much light as possible.
- Turn on all the lights, especially dark corners and hallways.
- Turn off the television. Play quiet background music.
- Showcase your homes best features.
- If you’ve repainted in neutral tones, add bold splashes of color with throw pillows, pictures, crockery, etc.
- Place fresh flowers where they’ll stand out.
- Open all doors between rooms to give an inviting feeling.
- If possible, open windows beforehand to circulate fresh air.
- Remove all clutter, ensure beds are make and clothes are put away.
- Floors should be clean, carpets and rugs vacuumed.
- Trash and recycling bins should be tidy and odor-free or out of sight if possible.
- The kitchen and bathrooms should sparkle.
- This trick still works, if possible bake cookies or put a pan of cinnamon in the oven to create a warm and inviting aroma.
- Ideally, pets should be unseen. Pet areas should be clean and odor-free.
- Lock away and hide all cash, jewelry and small valuables.
- Important: Keep your home available and ready for showings at all times!
- This is especially important during the first 6 weeks when you’re selling your home and your listing is new.
- Try to accommodate the time the buyers want to see your home. While this may be inconvenient from time to time, you’ll want to be sure your maximizing the number of quality showings by motivated buyers.
- Allow your realtor to put a lock box on the front door to maximize access to your home for showings.
Successfully negotiating the deal. In general, negotiating the transaction is the most complex part of selling a home. It’s important to have an experienced and savvy Realtor who has successfully worked through many different transaction scenarios. So a buyer has submitted an offer. Now what? Below is an outline of the overall process. Keep in mind, most buyers are trying to get a good deal. Often times they will submit an offer which is shocking low. Just because an offer is low doesn’t mean the buyer isn’t serious. Like all of us, we want to buy our home cheap and sell it for a high price. The first offer is just the beginning of the sales process. There is almost always an expectation that you will counter the offer. Many times, there may be multiple rounds of negotiations between you and the buyer as you work towards a mutually agreeable sales price.
- Overall Process for Selling your home
- Typically a buyer with the help of their own realtor will make an offer on your home using a contract that has been developed by your local real estate association in conjunction with legal counsel. These contracts enable the buyer to submit a price and they may also include clauses for specifying various terms of purchase, such as the closing and possession dates, the deposit amount, and a variety of other conditions.
- The offer will be delivered to your Realtor who will then present it to you. Closely review every detail of the offer with your Realtor. At this point you can accept the offer, reject it, or counter it to initiate the negotiation process. Multiple offers and counter-offers with deadlines for responding and meeting various contingencies and special conditions (example – a home inspection or buyer financing) will be exchanged between you and the buyer until a mutually-satisfactory pending agreement is reached or negotiations collapse.
- Don’t show your hand. It is crucial to keep certain aspects of your selling situation (example – how urgent you are to sell) as concealed as possible from the buyer and buyer’s agent.
- Understand and respect the buyer’s priorities. While it’s important to keep your own priorities in mind, you also need to understand the priorities of the buyer. If a buyer is adamant about the sales price it may be because they are at the top of their price range and can’t afford a higher price. This is where creativity by your Realtor is important. There may be other concessions that could be made by the buyer which which will allow you to continue negotiations bringing you one step closer to selling your home.
- Respond quickly to offers. If a buyer has submitted an offer, they are motivated to make a purchase. Respond as quickly as possible. Buyers have been known to get buyers’ remorse. If you really want to sell your home, don’t delay. You want to work towards an agreement as fast as possible.
- Stay calm and be patient. Sometimes buyers will make requests which are not acceptable to you. At all times keep communication civil and agreeable, even if the buyer gets tense, or you might lose the sale.
- Agree on big issues first. Come to agreement on any major issues first, then circle back and resolve any smaller issues. If you’re not able to agree on major issues, there is no sense in wasting your time negotiating on smaller issues.
- Meet halfway. At the end of the day, if there are disagreements about relatively small expenses, split the difference.
- Contingencies. When you’ve landed your buyer, your signed acceptance of a written offer becomes your sales contract. Except for removing any contingencies, this document is the binding basis for the sale. There will be set dates for contingency items such as a home inspection or confirming financing.
- Rely on your Realtor. It’s your agent’s responsibility to represent your best interests every step of the way. Your success is their success.
Closing the deal. If both you and the buyer have taken care of your respective obligations outlined in the contract the process of completing the transaction (closing, escrow and settlement) should go smoothly. Almost every sales agreement includes contingencies and special conditions that have to be fulfilled by the buyer and seller before the closing date which is usually thirty to sixty days after both parties sign the contract. Typical contingencies and special conditions include:
- The buyer securing financing.
- A Title search which is a historical review of all legal documents relating to ownership of the property to ensure that there are no claims against the title of the property.
- The purchasing of Title Insurance in case the records contain errors or there are mistakes in the review process.
- A professional appraisal of the home, requested by the lender to ensure that the home’s actual value justifies the loan amount.
- Any additional contractual promises you have made in connection with buyer incentives, home improvements, etc.
- An independent inspection of the home’s structural and functional condition (roof, electrical, air conditioning, plumbing, pool, etc.).
- The mold, radon and termite inspections should be performed by an inspection company that only provides these services.
- A final walk-through by the buyer to look at the home to make sure that it’s in the same condition as when the sales agreement was signed.
It is important to review the sales agreement with your Realtor and adhere to any obligations you committed to in the sales agreement. Any shortfalls or mistakes at this point can be very costly.
Completing the transaction. The closing is typically handled by a third party professional who conducts the closing proceedings. The third party is usually a lawyer or a title agent, I highly recommend an attorney represent your interests and conduct your portion of the closing process. The closing attorney or title company representative will review the sales agreement and does the following:
- Determines the total amount due from the buyer and collects the check.
- Determines all the adjustments (e.g. seller prepayment of taxes, legal fees, association dues, etc.) and ensures that they’re factored into the transaction.
- Assures that the transaction costs (closing, legal fees, etc.) are paid.
- Determines the seller’s payments, credits and adjusted net proceeds.
- Witnesses the seller’s signing of the property title and all other documentation associated with the transaction.
- Collects the keys and any other necessary items from the seller.
- Provides the seller with the net proceeds as well as copies of the documentation pertaining to the sale.
- Ensures that the buyer’s title is properly recorded in the local records office along with any mortgage liens.
The buyer will take possession within a couple days of the closing date.