You feel as if it may be time to sell your home. There can be many reasons for doing so. Do you have a new job, perhaps a growing family? Do you want more space, or are you tired of maintaining an empty nest? Are you ready to leave the area for a new adventure, or enjoy a change in lifestyle? Is this a second home that you no longer visit as much as you once did? Your reasons for selling are highly personal and can be very emotional.
You begin thinking about options, looking to the future and where you want to be. You start talking to friends and family, building a network of trusted listeners and advisors. These thoughts created the foundation for moving forward, and now you want to do so. What are the steps forward?
Research the markets and assess your finances
You probably already have an idea of the selling prices in your neighborhood. Many online platforms will provide you with a rough estimate of the value of your home. Subtracting any loans or credit lines secured by your home equity from the expected sales price will give you an approximate value of the cash you will receive
If you plan to purchase a replacement home, you will also need to assess your economic standing, taking an inventory of any income and assets that you may need to draw upon when the time comes. If you will need a loan for your next purchase, now would be a good time to work with a mortgage provider to obtain a loan prequalification (or, even better, a preapproval).
Armed with this preliminary financial information, you can turn back to your favorite online platform to get a glimpse of home prices in areas that you desire, fine tuning your research to identify neighborhoods that align with your budget.
Once you have completed this step, you can move forward with confidence on your new quest.
Select an agent
Selecting the right real estate agent to work with is the key to a successful transaction. You need your agent to be someone you can add to your list of most trusted advisors with confidence. You need someone who knows how to help you price and market your home for the best financial outcome. The right agent will be your advocate, deftly guiding you through the many steps of the process, helping close the sale smoothly by monitoring all that paperwork to help minimize slipups and needless delays.
Things to consider when looking for an agent:
- That they are more focused on your goals than just on making a commission.
- That they are very familiar with the particular characteristics of your local market.
- That they can help you prepare your home for sale in a cost-effective fashion, with the insight of an architect guiding an understanding of when it is more advisable to make improvements or just perform selective staging.
- That they will work with you to market your home effectively and according to your schedule.
- That they have personal as well as professional experience in buying and selling homes.
- That they are competent and detail oriented.
- That they project an air of professionalism and competence.
Price your home
Selecting the list (asking) price for a home is both an art and a science. Remember that the asking price and the selling price are not necessarily the same. You’ve seen that some homes sell quickly near asking price, while others languish on the market. Your agent should become familiar with your home and perform a careful comparative market analysis (CMA) to establish the likely selling price. This information is essential for setting an asking price that will attract qualified buyers to your home. While any agent or online algorithm can put together a quick CMA from publicly-available information, there is no substitute for a personalized approach that takes into account the unique characteristics of your home.
Prepare your home
If you know of simple repairs that are needed, now is the time to finally get them done. Once those have been tackled, it’s a good idea to order a home inspection to avoid surprises later.
This is the time to look at your home with an unbiased eye, working with your agent to determine how to best present it to buyers. Preparation can range from just tidying and rearranging your furnishings or staging, to a complete redecoration, or even minor remodeling. Each situation is unique based upon the home, the market, and the seller’s preferences; your agent should be ready and able to help guide you through the pros and cons of each option, with an eye towards the bottom-line value of any choices you make.
You’ve heard it before: curb appeal is essential. At a minimum, landscaping should be manicured and the front door should get a fresh coat of paint. Your agent should advise you on whether additional work might be beneficial.
And then, there’s that pesky paperwork. There are a number of disclosure forms that will need to be provided to buyers. Your agent needs to be knowledgeable about the requirements and should help guide you through the process so that you’re ready long before that first offer comes through.
Market your home
Your agent should have a relationship with a real estate photographer who can produce a professional set of images that show your home at its best. In some cases, 3D interior images or an exterior drone video may also be appropriate. A unique website specific to your home can also be a great marketing tool. The goal is to entice potential buyers to visit in person and fall in love with the home.
A well-prepared agent will write a draft of a comprehensive listing description that features the particular strengths of your home, and will give you plenty of time to review it for accuracy.
If there are special conditions you need, this is the time to get them in writing. For example, perhaps you need a leaseback period to give you time to close another real estate purchase, or the home is a rental and you intend to perform a 1031 exchange.
Home showings
Your agent will work with you to determine how many open houses are appropriate. Your home’s first open house will most likely be the broker’s tour. These are weekly tours intended for local agents and brokers, although a handful of buyers or neighbors may also visit. Your agent will meet all of the visitors and be available to answer questions.
You’ll also need to work with your agent to establish days and times that work best for individual showings by appointment, how much notice you need, and whether there are any special showing instructions that need to be communicated to the buyers’ agents.
If you’re living in the home, your job will be to make everything clean and tidy, then vacate the premises for the duration of each open house or showing.
Entertain offers
Depending on market conditions, your agent may recommend accepting offers as they come in or setting a date when offers are due, then reviewing the (hopefully multiple) offers all at one time.
Your agent should present you with an analysis of all offers received so that you can review them together and determine which, if any of them, you want to entertain. There are many variables to consider, such as proof of the buyer’s funds available, loan and appraisal contingencies, contingency on sale of the buyer’s current home, earnest money amounts, concession requests, closing cost allocations, closing timeline, and more.
Negotiate with your buyer
In many cases, you’ll want to pick the most desirable offer and make a counteroffer that modifies one or more of the terms of the initial offer. It’s important to understand that countering an offer renders the original offer void. As a skilled negotiator, your agent can help you determine when a counteroffer is a good idea, and if so, what your counteroffer should include.
Navigate buyer inspections
The buyer will likely choose to have their own general property inspection as well as roofing, pest control, and possibly additional inspections. Your agent will work closely with you to arrange access to your home for these. The buyer may ask for price concessions based upon their inspectors’ findings. If you arranged for your own inspection at the beginning of the process and disclosed the information to potential buyers, it’s likely that there won’t be any big surprises.
The buyer may use their inspections as an opportunity for further negotiation. Your agent will be a valuable resource during this period, acting as your advocate and advisor.
Close the deal
More paperwork! While you will have seen a lot of documents up to this point, closing is by far the most paper-heavy (or pdf-heavy, if your agent is more technically savvy). Your agent and your escrow officer will work together to prepare the necessary forms and calculations, but it is in your own best interest to review everything thoroughly and ask questions if anything is unclear to you.
The final step is settlement; this is the moment you’ve been waiting for, where title transfers from you to the buyer while the purchase funds are transferred to you (less any liens such as mortgages that are paid off).