The main steps involved in selling a home
There are many aspects to consider when you’re preparing to sell your home, from deciding whether or not the timing is right and choosing a sale method, to picking out a real estate agent and getting the property valued. Let’s take a look at what’s involved.
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Is now the right time to sell your property?
Most people decide to sell theirt property due to changes in their lifestyle. This could mean moving to a different area, purchasing a smaller home or requiring a larger property due to a growing family. Regardless of your reason for selling, it can be difficult to figure out when the right time to sell is, especially if it’s the first time you’re selling a property.
There is little guarantee that the market conditions will be perfect the moment you decide to sell your home, which is why it’s important to be aware of what’s going on in the property market and keep an eye on the performance of the economy in general.
Checklist to Sell a House
Checklists are important to get things right at first attempt. Even if you boast of having a super memory, there is still the possibility of forgetting something if you don’t put it into writing. In short, checklists reduce the risk of committing more mistakes. That is why a checklist is imperative if you are thinking of selling your house.
There are many things that you need to bring into consideration before you put your house into the market. Some of these things include repairs, taxes and fees, and legal representation. These are just some of the few things that will help you jumpstart what needs to be done before you sell your house.
Also take into account:
- Your personal goals
- The state of your personal finances
- The fact that you’re going to have to cover repayments every month
- Capital gains tax on the sale of any investment properties
Even if property prices are low it might not necessarily be a bad time to sell because even if you’ll get less for your current property, because there’s also a good chance you will pay less for the new property. The same applies when property prices are high. Of course, the best option would be to purchase a property when prices are low and to sell a property when prices are high, but not many people can afford to do that.
How Will You Sell Your House?
There are two methods how you can sell your house – through a private treaty or through an auction. In a private treaty you set the price of your house in accordance with its real market value before you put it in the market. On the contrary, when you sell a house through an auction, you set a reserve price and accept whatever minimum sale the property made. Whether you decide to sell through a private treaty or an auction, both methods have their advantages and disadvantages.
Advantages of Selling through an Auction
- There is a reserve price. The reserve price is the limit you set when you decide to sell your house through an auction. The bidding will not start or your house will not be sold lower than the reserve price you have set.
- Your property gets maximum exposure. By putting your house through an auction, you add more appeal to the property and attract a large number of potential buyers.
- It has a specific date. The deadline adds an aura of marketability for your house because of the sense of urgency. More so, you don’t have to wait long for it to sell.
- It is quick and final. When you sell your house through an auction and someone decided to buy it, you get the deposit and have an exchange of contracts right away. There is also no cooling off period in an auction giving it a sense of finality. Thus, if you decide to put your house through an auction, be sure that you can move out of the house immediately once the buyer decides to move in.
- You get the best price. Remember that your property cannot be sold lower than your reserve price. This means that there is a possibility that you can get an even higher price for your house.
Advantages of Selling through Private Treaty
- There is no specific date. This is to your advantage if you are not in a hurry to sell your house. The only downside to this is the longer your house is in the market the more it will be affected by market changes.
- There is a sense of secrecy. Through a private treaty, offers made by each buyer are never disclosed to others which keep the other buyer’s guessing. This can encourage the sense of urgency in prospective buyers.
- It has a calmer atmosphere. If the fast-paced process of an auction is not for you, then selling your house through a private treaty is better. It also gives you a sense of control as you assess the market over time.
- It is more appealing to most buyers. Buyers favour private treaties more than auctions because they think they can get a much better deal through this method. The cooling off period also appeals to most buyers as it gives them some sort of a safety net.
Preparing Your House
Whether you decide to sell your house through a private treaty or an auction, you need to make it more appealing and marketable to buyers. Remember that first impressions last and the last thing you need is to repulse your potential buyers just because of a peeling paint near your kitchen counter.
Just like what Donald Trump said about a dirty car costing $200, but a clean car will cost $220, so does your house. Your house can command a higher price if you have made the necessary repair. Besides, a house that has undergone repairs, repainting and cleaning is more attractive, bigger, and brighter.
- Floor – What type of floor does your property have? If it is hardwood, it is much better if you remove the carpeting and have the floors refinished. On one hand, if your floor has carpeting, you might consider replacing it if needed. You should also look for chipped or broken tiles in the bathroom floor and have them replaced.
- Walls and Ceilings – Repaint your walls and ceilings to make the house look sunnier and roomy. Also check out for cracks on the ceilings and walls. Remember that buyers usually spend a lot of time inspecting them.
- Bathroom and Kitchen – If your kitchen cabinets are in perfect condition, you don’t have to change them; however, it is a different story if they look worn away and dated. Make a thorough check on the light fixtures and replace them if necessary.
- Exterior – If your house needs a new roof, you can have a contractor fix it in just a couple of days – just in time for your open house. You should also check the fences and see to it that the lawn is well- kept.
Contracts and Titles
After everything has been settled, your work is not complete until you take care of the legal aspects of selling the house. Instead of doing the checking of titles and other inspections yourself, it is better to hire an experienced and qualified solicitor to do the legal part for you. It can save you from stress and help you focus more on the repairs.
Make sure that you have the contracts and titles all cleared up and ready. If there are any caveats to the property, you should ask your lawyer what provisions can be made to remove or clear them.
There are other things that you need to consider before you sell your house. Start with the basics first and gradually progress to the more complicated matters. This way you will not find yourself overwhelmed with all the work you need to do before selling your house.
The main steps involved in selling a home
There’s a lot more involved in selling a property than putting up a ‘for sale’ sign and hoping buyers will show up to purchase your property. Below is a quick look at the different steps you have to go through to sell your home.
Making the decision to sell
The first step is to assess what’s going on with the economy and property market to determine whether or not it is the best time to sell. You also have to take into account your own circumstances and if you need to sell right away or not, even if the market conditions aren’t suitable. You should consider whether you should first sell your current home and then purchase a new one or vice versa.
Selecting an agent
Picking an agent is one of the most critical steps in ensuring your property sells successfully since they will be carrying most of the load. An agent has to handle all the difficult aspects of the sale, including listing and marketing the property, negotiating the contract and dealing with legal matters, which are all essential to a successful sale.
Be careful when choosing your agent. You want someone professional, who knows what they are doing and who will listen to what you want rather than forcing their requirements on you.
Figure out How to sell
The next step is deciding how to sell. There are a few different types of sales, including auctions, set date sales and private sales and in conjunction with your agent, you can decide which option is best. You will also have to work with your agent to come up with a plan to list the property as well as showing it.
Working out how much you want
The next step is to work out the price you want to sell at and any property inclusions. Factors that will be considered in evaluating the value of your property include its location, size, date of construction and other features. Other property sales in the immediate vicinity may also give an indication of a price range. Additionally, the general property market and the trends in the area will also play a role in determining the price you can get for your property.
Sign the agent agreement
Once the price has been set, you will have sign a contract with the agent, which will cover things like the agent’s commission, the estimated price of sale, how long the agreement is in place for, advertising expenses, process and more.
Prepare the Vendor’s Statement
Now it’s time for you to put together the Vendor’s Statement or Section 32 for the property you are selling. Likewise, the Contract of Sale must be prepared via your conveyancer or solicitor. These documents will cover all the information a potential buyer might require.
Marketing your property
To attract potential buyers, you are going to have to market your property, which includes advertising and showing off your home. Generally, this means getting some good photos of your home, creating online ads and drawing up the floor plan.
Putting it on the market
Potential buyers will get in touch with your real estate agent to set up an appointment to see your home, or they might opt to attend one of your open homes instead.
Selling and negotiating
Your real estate agent will be in charge of auctioning your property or mediating between you and a potential buyer to make sure a mutually satisfactory price is agreed upon. The person buying the property will then have to put down a deposit.
The final details of the sale will be worked out by the lawyers and banks of both parties to ensure everything is in legal and financial order.
Time to settle
If everything proceeds without a hitch, you will hand over the legal rights and keys of your property to the new owner, who in return will pay the balance, either directly or via their bank. At this point it’s time to sit back and relax because you’ve successfully sold your property.
Which sale method should you choose?
There are quite a few ways in which you can sell your property and you might prefer one over the other. As mentioned, the most popular methods of selling a property include auctions, private sales and set date sales.
The different types of sale method
An auction is quite a popular method for the purchase and sale of properties. What happens is that you set a minimum price under which you will not sell the property and the agent runs the auction on a certain date, taking into account the reserve price. Auctions are regulated by law, which is why it’s important to have a professional running it.
If the bids placed fail to reach your reserve price, the agent might negotiate with the person who placed the highest bid. Auctions can sometimes lead to higher prices on a property because of the competition between the prospective buyers and the sense of urgency that is created. However, you need to be careful, because the idea of an auction can also backfire and put some buyers off. This is why it is essential that you talk to your agent to come up with the best way for you to sell your property.
Private treaty or asking price
Most buyers prefer it when the asking price is listed or a request for offers or expressions of interest is made because the process is simpler and not quite so intimidating. A buyer will generally try to get a lower price than the one listed, which is why it’s essential that you talk to your agent so he or she knows what your expectations are. A private sale can be more attractive to a buyer, but it’s usually a lengthier process than an auction or set date sale because the urgency is not quite there.
Set date sale
Set date sales tend to be popular in slower markets. You decide a price range for your home with your real estate agent before posting ads and showing it. The agent then invites potential buyers to make a formal offer on the property, which has to be submitted by a certain date. After the date in question, the agent will gather all the offers and present them to you. You can pick the highest offer, start negotiating with the highest bidder or list the property again if the bids are under the price you are looking for.
Valuing your home
Naturally, being a seller means that you want to get the most money for your home but at the same time avoid a price which is too high. How much your property is worth is determined by a number of factors, including:
- The current property marketing conditions
- Interest rates and the availability of finance for buyers
- The property type
- The price at which similar properties in the area have sold for.
In the end, the market will determine how much your property will sell for but at the same time you need to get a realistic idea of what to expect. A good way to get a realistic price is by talking to an experienced local real estate agent, as they’re constantly aware of the state of the property and what’s selling at what price. It’s also a good idea to get opinions from two or three agents.
If you get completely different prices from each different agent and you aren’t sure which one is more accurate, you always have the option of commissioning a licensed real estate valuer who can objectively and independently evaluate how much your home is worth.
Should I use a real estate agent or sell my home on my own?
Some people feel that they can sell their home on their own and think that it’s a wise decision because they’ll save money on the commission they would have to pay a real estate agent. Unfortunately, this is not always a good idea because of the size of the financial transaction involved, which is why you should consider using the services of an expert. While you might have the resources and experience to do things on your own, it can be quite costly and will certainly take up a lot of your time.
Remember that a real estate agent’s job is to sell properties, and that’s what they do year round, meaning they have a lot of experience. This experience can prove to be an incredible asset for you, and you should certainly take advantage of it.
Furthermore, you can gain some legal protection as well when you use an agent.
A real estate agent can help you with a wide range of issues, including:
- Offering you a realistic evaluation of how much your property is worth
- Helping you decide what sale option will work for your situation, whether it’s by auction, private sale or set date sale
- Organising, attending and recording potential buyers at open homes during inspection days
- Managing any questions about the home
- Offering you a larger pool of prospective buyers thanks to their database
- Handling the negotiations for you while doing their best to make sure you get the maximum possible amount for your home.
A real estate agent can do a lot more for you, including helping you coordinate the marketing of your property including the creation of flyers, floor plans and taking photos of your property. They can also prepare a professional advertising plan that will ensure your property receives the highest level of exposure to make sure as many buyers as possible see it.
They can also help you with the paperwork by preparing a Contract of Sale as well as offering advice regarding legal, financial and conveyancing services. They will also help you close the sale via a solicitor or conveyancer.
How to pick a real estate agent
It’s important that you take the time to pick a good agent because they will be in charge of selling one of your most important assets. A good agent will be highly professional and very dedicated in what they do. You need someone with a good reputation that still strives to make the best possible impression and is willing to put in the hard work.
Many people run to the most popular and successful agents they can find, which can be a good strategy since they may be making good sales. However, keep in mind that they might have a lot of listings and you might not get the degree of attention you need since they have to cover so many properties.
So when you research potential agents, try and determine how you’ll be treated if you sign on the dotted line. Will you be given their full focus and attention or will you just end up fading into the background?
Choosing your real estate Agent
Some things you should look for in an agent include:
- Their willingness and desire to meet your needs;
- Their ability to stick to your requirements rather than imposing their own;
- Membership in the local, state or national real estate institute;
- Good references and good word-of-mouth advertising from clients they’ve served in the past;
- Knowledge of the area where your property is located;
- Knowledge of the price range you’ll probably be able to sell the property in;
- Commitment to honesty and transparency in discussions regarding the market and your personal circumstances.
Finding and researching an agent is a matter of using the internet and your social networks. There are many sites that will allow you to see what agents are working in your area. Once you have the list, you need to research them by checking out their sites, blogs, discussion forums and any comments made by clients. Also, don’t forget to search for reviews. You could also consider contacting the people who have left comments to ask for further information regarding their experience working with said agent.
Once you have narrowed it down to a few agents, take the time to meet with them in person. Make sure to prepare a list of questions you want to ask in advance as it will make your life easier. And don’t worry if the agent requests to meet at your home.
This allows them to see and evaluate the property and get a good idea of how they can help you. This is something the agent should do for free and is in no way a commitment on your part to engage their services.
After your meetings, you can decide which agent was the best fit and then it’s time to draw up the agreement, which will cover an estimation of how much you will pay in fees, charges as well as other expenses you might have to cover once the property is sold.
Marketing your property
Marketing your property is essential because it’s the only way to get it in front of buyers. A good marketing plan doesn’t have to cost a fortune but a little investment is required to ensure you get the best possible results. Let’s take a look at some of the ways a property can be marketed.
Advertising online: statistics and facts
There are many channels you can use to advertise your property and getting the right combination is critical. However, it’s also worth keeping in mind that 86% of people use the internet when looking for a property to purchase, which makes online advertising extremely important.
The largest online site for selling real estate within Australia is considered to be www.realestate.com.au. Most real estate agents will list homes for sale on this site. Others may also choose to list the property on other sites such as www.domain.com.au or www.homehound.com.au, as well as on their own internal company website. This is done in an effort to increase exposure and maximise the number of people who will potentially see the property.
Getting buyers on the move
When you put your property up for sale online you want to make sure people can access your listing via a wide range of devices. After all, nowadays people are using a lot more than their computers or laptops to access the internet. So, you need to make sure the sites you are advertising on have mobile versions, apps and more to make it as easy as possible for prospective buyers to search for properties.
The fact is that more and more people are using apps and mobile sites to search for properties. Furthermore, most people use various devices and switch between them during the same day, so it’s clearly essential that you advertise your property in such a way that people can see the ad no matter what device they are using.
How much should I spend on advertising my property?
To get the best price for your property, you need to make sure as many people as possible see it. The more people you have who are interested in purchasing your property, the better the price you will get because they will compete with each other, which will only raise the price.
The main purpose of advertising your home is to make sure you get in front of as many eyes as possible and you will find that if you invest just that little bit extra, the results could be more than worth it. If you don’t put enough money towards your advertising schedule you could end up with a property that doesn’t sell. You could also find yourself wasting money on advertising that doesn’t work as well as continuing to make mortgage and interest payments.
Some agents might include advertising costs in their commission, but it still pays to enquire as to where your property will be advertised so you know where your money’s being spent.
Your property’s advertising schedule
To make sure that your property gets the maximum amount of exposure possible without you going over budget, you need to create an advertising schedule that’s in line with your needs. You should also consider other factors such as the average number of days your property has been on the market, what other properties are up for sale in your area and how much your property is worth.
Even though there are so many advantages to advertising on well-known real estate sites, there are still many agents who create marketing plans that do little to take advantage of the internet. This is why it is essential that you get as much information as possible from your agent regarding how and where your property will be marketed.
Don’t forget that putting up a listing online is an excellent way to reach the largest possible target market, namely people looking to purchase properties. After a few weeks of your listing being online, you can check where it ranks in the search results. This is because you can take certain steps to increase its rank and make it stand out as the large real estate sites give you options to upgrade your ad.
Should I use video to sell my property?
Using video to sell your property is a great way to attract even more prospects and is a great way for you to stand out. Some large real estate sites allow you to post the video right on the site. However, for those that don’t offer this feature, you can always post a video on YouTube and link to it.
A video will allow buyers to get a better view of your property and usually sticks in people’s minds better than just some photos. It’s a great way to engage your target market, which can really help with selling your property.
Presenting your property
Presenting your property properly is essential to ensuring you attract potential buyers. People’s first impression of your home is critical so the better the presentation, the faster you will find a buyer and the higher the price the property will fetch.
When you’re presenting your property, the first impression is the most important because that’s what people remember. So, you need to make sure your home is clean, neat and both the interior and exterior are presentable. It’s important to get the maximum degree of curb appeal by making sure the exterior looks great because many will drive by to look at the property before they decide whether they want to have a look at it on an open day.
Remember that your property will be one of many homes a prospective buyer will see, which makes it imperative that you put your best foot forward. The more attractive a home seems, the higher the likelihood of it fetching a good price is.
There are three main factors that will ensure the presentation goes off without a hitch and you put your property in the tidiest, well-maintained light it can be. This will require you to clean your home well, both inside and out, so that it looks as livable as possible. Get rid of as much clutter as possible to free up space and make the rooms appear larger. The better the property has been cared for, the more valuable it will be, so make sure to get small annoyances fixed before you put it on the market.
When it comes to décor, everyone has different tastes, so it’s a good idea to go with something neutral. This means you might want to put the disco ball away and try to stick to neutral, soothing tones. You can use paintings and mirrors to fill a blank wall and give the room a more homely appearance. Add vases and plants to achieve the same thing. Use single beds in smaller bedrooms to make them appear larger and put some outdoor furniture in the yard to show buyers how the area can be used.
The key to setting up a property for presentation is to make it look homely so that buyers can envision themselves living there.
Take a step back and take an objective look at your home. Does it look like a hurricane just passed through or does it look homely and inviting?
Your property has to be presented in the best light from the second you put it on the market. So, keep the following tips in mind for a successful presentation:
Curb appeal: Pull the weeds out and add some nice pot plants to improve the look of your property. It’s essential for the front of the home to look enticing as that’s the first thing potential buyers see.
Let the light in: Make sure the windows are sparkling before every viewing. The cleaner the windows are, the more light there is and the better the property will look.
Reduce clutter: The idea is for a prospective buyer to be able to imagine their possessions in the property, so get rid of clutter and make sure everything is nice and tidy. Getting rid of clutter also makes the rooms seem bigger.
Setting the scene: You want to give your home as much appeal as possible and if that means hiring furniture to get just the right look to get buyers in the door, then that’s exactly what you should do. It’s one way to give your home a new, fresh look that can turn an interested party into a buyer.
Repairs: If there are broken light bulbs or leaky faucets, make sure to fix them. In fact, make sure all those small repairs you’ve been putting off for a while are taken care of. With a little paint you can freshen up the woodwork and hide scuffs and scrapes. If you get the basic maintenance covered, it’ll reduce the likelihood of a buyer finding any problems.
Fresh air: Do your best to get rid of those nasty smells, such as smoke or pet odours. Open up the windows, put on a fresh pot of coffee and put out some fresh flowers to make the place as inviting as possible. In fact, consider baking a batch of cookies, as the smell of baking will speak to people on an instinctive level, making them think of home, which is exactly how you want a prospect to see your property.
Keep it light: You can make rooms appear larger by using lights, leaving doors open and adding mirrors.
Pets: If you have pets, it’s best to take them off the property when you are having open days and always clean up after them.
Make it inviting: Make your home even more inviting by making sure the interior temperature suits the outside weather. If it’s hot, turn on the air conditioning or the fans. If it’s cold, turn on the heaters. You want people to feel comfortable and you want them to want to stay and never leave.
Tips on shooting great photos
Great photos are just as essential as making sure the presentation of your property is done well. A photograph is generally the first thing a buyer will see and will often determine whether or not they want to view the property, so the better the photo, the more people will want to view your home.
If you decide to take your own photographs, or even if you want some input in how your real estate agent has your property photographed then keep the following suggestions in mind.
Good lighting and quality: It is essential that the photos are great quality and if you take the photos yourself, make sure there is plenty of light, whether it’s natural or artificial. A great photo would be of your property in the evening with the lights on inside.
Nice and clean: You don’t want rubbish, laundry, dirty dishes or clutter in your photos, so make sure to clean the property before taking photos. Try and remove as much clutter as possible to give the property a roomy feel.
Inside and out: Most people want to see shots of the interior of the property as well as the exterior. If you don’t have interior shots, some people might find it strange and will avoid the property, thinking you are hiding something. So, make sure to get a range of interior and exterior photos.
Drop the effects: You can take photos that make the space appear bigger than it is and it might get more people to view your home but this strategy will backfire once people see the reality. You want to use photos to enhance the property, not to lie to potential buyers.
Seek a professional: Considering that you’re selling one of your most important assets, it may be a good idea to hire a professional photographer. He or she will know how to take photos that show off your property in the best light and will be well-worth the cost in the long-run.
The day of the auction
While you might be anxious come auction day, if you understand the process, you’ll be able to relax. So, this is how things will go on the day.
Before the day: Auctions can be over quickly, which is why it’s essential that you have ironed out all the details with your agent, including how things will proceed on the day. Thus, you need to make sure the reserve price is set and you also need to decide whether you will be making vendor bids via your agent. These decisions have legal consequences and must be clarified. Of course, you should also ask questions if you’re unsure about something.
On the day: The law states that the agent must display documents pertaining to the property at least half an hour before the proceedings begin. The first thing the auctioneer will do is to announce details such as the state laws applicable to auctions in general as well as the rules of the current auction, which includes whether or not vendor bids and co-owner bids will be utilised. You should discuss the legal aspect of the auction with your agent because laws are different from one state to the next.
Opening bids: The auctioneer will request an opening bid and will set the level by which all the bids must increase, such as increments of $5,000. People can try to place other bids of smaller or greater increments, but it’s up to the auctioneer whether he or she will accept the bid or not.
Sold: When the bid reaches the reserve price, the property is officially considered “on the market” and will go to the person who places the highest bid. If the highest bid is below the reserve price and no one is bidding anymore, the auctioneer will talk to you in private and ask if you want to drop the price. Once the last person has bid and you’re happy with the price, the auctioneer will give those attending another opportunity to bid by announcing “going once, twice, three times”. If no one places another bid, he will announce that the property is sold.
Payment: The highest bidder is required to make an immediate deposit after the auction, which is generally around 10% of the price they purchased the property at. The difference is paid upon settlement, which is usually established by the person selling and is generally 30, 60 or 90 days later. Keep in mind that the more flexible you are with the settlement date to help out the buyer, the easier it will be for you to sell the property. The sale is considered completed once the contract has been signed by both parties and any cheques and transfers have been done. The property is considered sold once the balance of the price of purchase has been covered.
Having an intimate knowledge of the selling process is invaluable information. Just as buying a property is an important step in anyone’s life, so too is selling a property. That’s why even if you have a competent real estate agent carrying out a lot of this work on your behalf it’s important to know how it works.