- Decide to sell: You are thinking about selling, but what is your motivation? Need to move for a job? Downsizing or up-sizing? Want to be closer to relatives? How soon? Just thinking at this time? Selling an investment property? All of these thoughts make a difference in your sales process, so it is a good place to start! Once you have considered your motivation and timing, you are ready for the next step!
- Find a REALTOR. You are ready to choose your agent. This is the person and company who will guide you through the selling process. You need to look for a REALTOR that matches your communication style and will listen to and focus on your needs. A small local agency will allow for more flexibility and personal service and still have the marketing reach of a larger company. Their role will be to provide education if needed, give you data so you can determine how your needs and motivation will affect your personal selling process and help you take the next steps. You may not be ready to sell, but just want information at this point. Go ahead and call! Your REALTOR will be happy to give you the information you need!
- Talk to your tax advisor: Once you have a REALTOR who has given you the initial data, it is time to contact your tax advisor. There are tax consequences from selling your home or investment property. Your tax advisor can help you determine if there will be taxable capital gains, if you can keep your tax basis, if a 1031 exchange will be the best option for your investment property or other questions with respect to your personal financial status.
- Get your home ready to sell: Once again, your REALTOR can guide you. At the very least, you need to de-clutter, moving your personal items to storage or your garage. A buyer needs to be able to imagine themselves in your home. Perhaps you should paint with a neutral color that will appeal to more buyers. It might be time for new carpeting/flooring to give the home a clean and fresh look. You could decide to do some upgrades. Make sure you choose upgrades that will allow you to get back their cost in the sale price. Ask your REALTOR to look at your home and help you with those decisions. They might also suggest that you get a Pest inspection or home inspection. A pest inspection looks for dry rot and termites and other pests. This will allow you to either fix in advance of the sale or provide information to the buyer to let them know the status and make it easier to make an offer knowing what they are getting. A home inspection does the same thing for the various components of the house. What is operational, what needs repair, are required safety items in place. Again, you can choose whether to do the repairs or simply provide the information during the sale. Ready? Let’s get it on the market!
- Comparable Values: Your REALTOR will look at available properties on the market and those that have sold recently to come up with a Comparable Market Value (CMA) for your home. They will discuss selling options with you with respect to different pricing strategies. Price at the high end of the market which may extend the time is takes to sell but be more likely to get a higher price in the end. You can price below the market to attempt to get multiple competing offers. Your selling needs may dictate the strategy. Do you need to sell very quickly, or you can wait longer and attempt to get a higher price? You may need to get your house in contract quickly so you can use the proceeds to buy your next one. This is why your motivation and timing we discussed in item one is important.
- Marketing: Get your REALTOR to explain their marketing plans. There are many marketing venues these days. You start with good quality photos. Your agent may be skilled at photography, or they may suggest a professional photographer be hired. The pictures, a great description and lists of amenities your home has is put into the Multiple Listing Service. From there it is distributed to the county you are in of course, in addition to all surrounding counties and across the country. Additional marketing strategies are, For Sale sign at the property, directionals if necessary to help find it, flyers, and discussions with other REALTORS. Open houses do not always make sense in this county depending on the location. Showings will be scheduled. If you are still living in the home, you need to keep it picked up and clean. When a prospective buyer is brought by an agent, it is best to leave the home and take any pets with you so the client can view the home and be open with their agent.
- Offers come in: Yay! The offers will be given to your REALTOR who will bring them to you and go over the terms. They will explain the contract, discuss with you, and handle any negotiations. You can either accept the offer as is, make a counteroffer asking for better terms or decline and wait for another one. You might have several at once! Lean on your REALTOR to help through this technical process.
- In Contract: You have accepted an offer! Your REALTOR will send the contract to an Escrow company who will handle this process. Getting a preliminary title report to the buyer, working with you on mortgage or other lien payoffs, providing your proceeds calculations and handling the title transfer process. During this time, you may be asked for additional documentation or information. Please respond promptly to keep everything on schedule. You will get a Preliminary Seller Proceeds document which gives you draft numbers on what your closing costs will be and what the projected funds you can expect from the sale.
- During the contract phase: Buyers will be doing their investigations to confirm the condition of the property. You will be required to complete extensive disclosure documents stating what you know about the condition. The buyer may request inspection reports such as pest, home, well/septic and others. After they have reviewed all all this information the buyer may then accept the home as is or put in a request for repairs or other concessions. Your REALTOR will help you through these negotiations.
- Close of Escrow: Once all the final negotiations are complete, and all the contract requirements met, you will be asked to either go the escrow company, or have a mobile notary come to your house if located in another county, to sign documents. Once all parties have signed, the documentation will be sent to the county to be recorded. Of the day of recording ownership will transfer to the buyer and you will receive your proceeds!
10 Steps to selling a home
Congratulations! You have sold your home!!!
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