Real Estate Associates understand that there are different motivations for attempting to sell a home privately, often times it is due to a tight financial situation.Sometimes I wonder if the tight financial situation may be due to private real estate purchasing in the first place.You see, market value is a complex calculation of sale prices and other variables that an independent home owner may just not have access to.So while a buyer may think they are getting a better deal by purchasing from a private seller…that seller quite possibly could have over priced their home just from lack of information.Everyone feels they are getting a “good deal” just because there were no realtors® fees involved…until the purchaser tries to resell years later!At this point, the new homeowner may realize that they in fact over paid for their property, and to make ends meet must attempt to sell without the representation of a qualified real estate associate…and the cycle continues…
Now, at one point or another, one of these buyers who purchased privately will end up sitting with a realtor® asking for a current market value analysis.And as a real estate associate I have the unfortunate duty of letting this homeowner know that “it isn’t a matter of if you’ll lose…it’s how much.”Real Estate Associates have a responsibility to their consumers and community as a whole to carefully and continually analyze their local market to ensure fair market value and support healthy economic growth, and unfortunately it becomes harder and harder to maintain with so many consumers trying to “cut corners” when it comes to dealing with the single largest investment people make today!
I recognize that there are private home sale transactions that work out for everyone and close smoothly, there are some key factors involved that, as a real estate associate, I hope everyone will consider to ensure fair real estate transactions.If you are going to attempt to sell your home yourself you will be doing a lot of things that a real estate associate would normally do.
Here are some tips to help along the way:
1. Make Your Home Look Great
Presentation is everything. Home buyers are attracted to clean, spacious and attractive houses. Your goal is to dazzle buyers. Brighten-up the house and remove all clutter from counter tops, tables and rooms. Scrub-down your house from top to bottom. Make it sparkle. Simple aesthetic improvements such as trimming trees, planting flowers, fixing squeaking steps, broken tiles, shampooing rugs and even re-painting a faded bedroom will greatly enhance the appeal of your house. Also, make sure your house smells good. That’s right, clean out the cat box and light mildly scented candles.
2. Price Your Home Right
Careful not to over price your home. Over-pricing when you sell a home reduces buyer interest, makes competing homes look like better values, and can lead to mortgage rejections once the appraisal is in. Over-pricing when selling a home is the single biggest reason why many “for sale by owner” (FSBO) home sellers don’t sell their homes successfully. The home selling market dictates the price (not what you think it should be worth).
One way to try to accurately price your home is to contact a home appraiser, cost for this can be anywhere from $500-$800.
3. Hire a Real Estate Lawyer
Even though it’s an additional expense, it may be wise to hire a lawyer who will protect your interests throughout the entire transaction. An experienced real estate lawyer can help you evaluate complicated offers (those with a variety of conditions), hold the down payment, evaluate complex mortgages and/or leases with options to buy, review contracts and handle your home’s closing process. They can also tell you what things, by law, you must disclose to buyers prior to a sale and can also help you avoid inadvertently discriminating against any potential buyers.. Cost for this can be anywhere from $1000-$2000 or more.
4. Market Your Home for Sale
Exposure, exposure, exposure. That’s how sellers sell their home fast.Any marketing you can do will help, whether it’s social media (an affordable option if you have a lot of online connections) or Newspaper advertising, you’ve got to get your property out there.Real Estate companies advertise weekly in Newspapers, costs can range widely!!Also, Century 21 has a large online following of consistent buyers looking for a homes.We are also the experts on writing an attention grabbing description and taking pictures that showcase your homes finest details.
Open houses are sometimes a good way to attract buyers to your home. Typically, real estate agents conduct open houses for two reasons; 1. Clients expect them 2. They are a good way to attract buyers, not just for the open house but for all houses for sale in the Real Estate Agent’s area.This may be uncomfortable to a seller, as you will get very candid buyers perusing through your home making very blunt comments as to what they see, be prepared for anything!
-Home Brochures/Information Sheets
It is a good idea to create an information sheet (with a photo) about your home to give potential buyers. Consider printing copies of your ad from a professional print marketing business to give to people who visit your home.Sell your neighborhood as well as your house. Show enthusiasm, but don’t get caught-up talking too much about how “your daughter spent the best years of her life in this very room.”
5. Negotiate and Accept an Offer
When a home buyer makes an offer (this is often presented to you directly from the buyer or through their lawyer), you should consult with your attorney. Buyers and sellers should always have the right to have the contract reviewed by their lawyer of choice. The offer becomes a contract at the end of the Attorney Review Period, and is binding. Many of your home’s offers can be complicated and contain special clauses that favor one party or another. A Realtor® has the expertise to qualify a buyer properly to ensure a solid transaction; there are many things to consider here, use caution!
6. Home Inspections
All standard real estate contracts are going to give the prospective home buyer the right to inspect your property – so be prepared. Under a general inspection you may be obligated to make major repairs to appliances, plumbing, septic, electrical and heating systems – or the buyer may cancel the offer. The inspection will also include your property’s roof and exterior.
If you are concerned about how your home will fare when inspected, you may want to visit your local inspector. They can conduct an inspection for you before a potential buyer has one done. This way, you can address the problems before a buyer stumbles upon them.This would cost between $400-$600 or more.
7. Buyer Appraisals and Other Details
The mortgage lender may order an appraisal of your home to make sure they are not paying more than the house is worth. They may also order a surveyor to make sure that the property boundaries are properly laid out.This is known as a Real Property Report (RPR) and the seller may be obligated to acquire one at their expense, upwards of $1000.
At this point too, the mortgage company will issue a commitment. Again, the buyer (and their attorney) must complete all conditions listed on the mortgage commitment.
Prior to closing, you should notify your lender that you will be paying off your mortgage. After a closing date has been agreed to, you should contact your utility providers and advise them of your final billing date.
8. Closing Time
The day of the closing, the home’s buyer will want to do a “walk through” of the property to make sure all agreed repairs are completed and that the home is in the same condition as when the buyer made their offer. If problems arise at this point, the closing can still take place with funds held in trust to remedy the problem.
Closings usually occur 30 to 45 days after you have signed the sales contract. At the closing, all monies will be collected, any existing loans or liens will be paid, the title will be transferred, and insurance will be issued insuring a free and clear title. The home seller will receive the proceeds of their home shortly after the closing.
Don’t Forget to Do Your Home Work
This brief home selling guide is a general overview of the process when selling a home. Selling a home yourself can be time consuming and very scary, please remember that this is all second nature to a real estate associate such as myself.So before the thought of selling your home makes you want to run and hide, consider consulting a professional that can make the process an easy and enjoyable one!!