You are ready to sell your current home. So, you put up a for sale sign and wait. Sellers often get so wrapped up in finding their next great living space or just moving, they make a few mistakes in their eagerness to sell.
The Cost of Selling Your Home
One of the most overlooked steps in listing your home is the cost of actually selling your home. That's right, it costs you money to sell your home. You are not going to be rolling in the dough if you don't prepare to spend some money upfront. And, you will be sorely disappointed when you see less in that check because you forgot to account for commissions. A good rule of thumb is to expect the costs to be close to 10% of the selling price, providing you don't have major issues to fix.
Agents typically ask for around 6% commission. That is 6% of the selling price. Don't confuse this with the amount you receive after the sale. For example, if your home sells for $300,000, your agent will receive $18,000. This is a lot of money, and so completely worth it if you hire a good agent who will work to get you a higher selling price.
Closing costs can run anywhere from 1-3% of the home price. These costs cover an assortment of fees associated with selling a home, such as a title search, title insurance, credit report, loan payoff fees, recording fees, settlement/attorney fees, transfer fees. You get the idea.
Home inspection repairs can add up if you are not prepared for what the inspector reveals. It would be wise to invest a couple of hundred dollars before placing your home on the market to have an idea of what to fix or prepare to accept less. Having a pre-listing inspection could save you time and money upfront.
Seller concessions are like discounts for buyers. Sellers agree to pay certain closing costs. Often, concessions are asked for in place of repairs and replacements. In short, concessions make the home more affordable for buyers and may help close the deal for sellers.
Staging costs vary on the type of staging you want and the size of your home. Costs involved in staging your home include hiring a staging company, having your home professionally cleaned, installing brighter lights, making the home more comfortable and appealing to prospective buyers. Some real estate agents will offer this as part of a package, so make sure you know up front what will be provided in the deal.
Don't forget about your next home. You will need to have a down payment, moving expenses, and an emergency fund if things don't move as quickly as planned.
Let's be Realistic
What you want to get out of selling your home and the price you can actually sell it are often two completely different things. This is when a knowledgeable real estate agent comes in handy. They will be able to pull comps (or comparisons) of homes sold in your neighborhood in the past and compare homes similar to yours. Your agent will then determine how much you may be able to list your home. Curious about how much your home value is today? Check out the FHFA calculator. Pricing your home too high will deter some buyers from even scheduling a showing. Pricing your home too low, and you lose out on potential gains.
Don't Ignore Major Repairs
A long list of repairs will spook any potential buyer. The condition of your home should match the description you give. That being said, when you maintain your home and repair issues immediately, you avoid having minor issues becoming major issues and you can sell your home quickly. Leaving repairs untouched will lead to lower offers so the buyer can make repairs themselves.
Prepare Your Home for Selling
Clean, declutter, depersonalize, declutter, paint, declutter, add more lighting. The more of the home that is visible, the better opportunity home buyers have to envision themselves in the home. If your doll collection is taking up prime real estate in the living room, that's all they see. It can be very distressing to pack up all the pictures you love to see every day, but making the home look as if you are ready to move on can prompt a quick offer. If the buyers feel like you have too much packing to do and won't be able to close quickly, they may move on to the next less cluttered house. Less is more!
If your house is not easy to show, it won't be easy to sell.
Allow Your Agent to be an Agent
Give your agent the reins when it comes to selling your home. You are paying them a hefty price after all. Your agent can schedule showings or open houses and inspections for you. This is not your responsibility.
If you truly are not happy with your agent, do not hesitate to fire them. Selling a home is one of the most expensive items you will sell, so it is always a good idea to research agents before committing to one and move on if it's just not working.
And, before you think you can go about the selling process on your own, do some research. You may save the 6% commission, but you gain all the headaches that go with scheduling showings, open houses, inspections, writing responses. Plus, an agent could potentially get you a whole lot more money! More money. Less stress. Get an agent!