In total, this guide will cover:
- Why You Need a Real Estate Agent When Selling
- Should You Sell Your Home First or Buy First?
- How You Can Prepare Your Home for a Quicker Sale
- Should You Stage Your Home?
- Home Pricing Strategies and Considerations
- Marketing Tactics to Bring in Home Buyers
- How to Respond to Home Offers
- Closing on Your Home Sale
- What Costs You Can Expect When Selling Your Home
Selling a home can be relatively easy as long as you take the proper steps to market your house well. Soliciting the help of a knowledgeable real estate agent simplifies the process even further, and with their assistance you can proceed to prepare your home, list it and accept the best offer without feeling lost along the way.
To help you on this journey, we have prepared a comprehensive guide containing just about everything you would need to know regarding the home sales process, as well as what practices can improve the chances of getting a desirable offer on your home.
So let’s dig right in!
Why You Need a Real Estate Agent When Selling
Buying a home can feel complex, but selling a home puts you in the uncomfortable position of someone else’s career. People who have never sold so much as a magazine subscription in their lives must suddenly learn how to court prospective buyers, present their home in an appealing light, price their home perfectly to suit market conditions and countless other factors.
The good news is that you don’t have to do it alone! All of the final decisions can rest at your feet, but with the help of an experienced real estate agent familiar with the local market like myself, you can shine a light on the winding path to getting your home sold.
Most importantly, a seller’s agent knows what you need to do to optimize the offers you receive and avoid common home selling traps. In the end, you will enjoy your home selling experience more and likely have more money in your pocket to show for it.
Critical benefits of soliciting a seller’s agent include:
- Advice on preparing and staging your home
- Access to marketing tools, including:
- An advertising budget
- Specialized online information hubs
- Carefree showing appointments
- Online advertising and listings
- Networking with other professionals and locals to increase the buying pool
- Data-backed pricing strategies
- Assistance with closing
- Experienced property photographs that enhance the appeal of your home in listings
- Strategies for emphasizing your home’s most desirable features
- Friendly, courteous service and assistance, even after-hours and on weekends
All of these services reduce the stress of selling your home while increasing the chances of you getting a fair offer without having to compromise. In the end, the headaches that can make home selling seem overwhelming all but disappear, with more money in your pocket to show for it.
And remember: the risks of listing your home and having it linger on the market price drop after price drop are far greater than the risks of agreeing to a sales commission. We don’t say this to hard sell, but to warn our potential clients that by the time they feel regret, most of the damage to their home listing has already been done. First impressions matter!
Should You Sell Your Home First or Buy First?
The natural caveat when selling your home is that you will need somewhere else to live afterwards. Knowing this, some people wonder whether to buy a new home first or sell their home first.
Buying first means only having to move once and also knowing for a fact that your head has somewhere to lay. You avoid renting, which can be pricey and uncomfortable, and you get the lengthy and unpredictable home search process out of the way. A natural drawback is that you will likely not have the income to own two homes outright. For many people, this means two mortgages, which a large portion of lenders would balk at. Plus, you run the risk of your listing going on longer than expected without an offer.
Selling first means having plenty of cash in pocket to search for a new home as well as a paid off mortgage. You can confidently search for homes within a precise price range. You also have to juggle fewer responsibilities, such as driving back to your old home to mow the lawn. A potential drawback is not being able to find a new home by closing and having to compromise on a rental property in the meantime. This can mean less pressure during your search, but some people — especially families — have trouble coping with their transitional home.
Making a conditional offer is a third alternative that refers to you making an offer on a new home with the condition that you have to close on the old one first. Essentially, it means buying and selling at roughly the same time. The problem is that many sellers see risk in conditional offers and will pass them up for other offers, even if they are slightly lower.
How You Can Prepare Your Home for a Quicker Sale
First impressions matter! Yes, I just said that in the section above, but you cannot say this enough when trying to sell your home.
An excited buyer forges an emotional connection with a home, one that encourages them to act quickly and disregard inhibitions that can make them tougher negotiators. When this buyer begins to see flaws in a home, cracks appear in their mental image of it, too. Suddenly, their excitement is tempered with reality, and they can convince themselves that a great deal is more important than getting the home at all.
This sort of scenario happens all the time. Whether the home buyer notices water stains in the bathroom or drives up to a lawn full of dead grass, their feelings about the house become a conflict between “Should I buy, or should I go?”
Another important fact to remember is that the longer your home sits on the market, the less buyers want to see it and the more aggressively they want to haggle.
So, to prevent a disenchanted buyer or a stagnant listing, you can prepare your home in the following ways:
- Declutter — Our consumer society has gotten to the point where we may not notice just how much stuff we have acquired. Your buyer will, though. Spare them by decluttering everything on both the large and small scale. Most rooms and surfaces should be sparse and all storage areas should be exactly half full.
- Depersonalize — Personal mementos and effects like sports memorabilia can separate a viewer from the buying experience and take them out of the process of envisioning themselves in the home. Try to eliminate family photos and potentially polarizing objects reminding viewers of religion, politics, sports teams, provocative art or even your pets
- Clean (and then clean some more) — Your home cannot be “had a free weekend” clean or even “company’s coming!” clean. It has to be magazine clean. Decluttering first can help. Get under every surface and in every object, such as lamp globes and the rolling tracks on your kitchen drawers.
- Landscape — Mowing the lawn, pruning trees and trimming back undergrowth is a must. Planting and landscaping can go even further, so consider hiring a professional service if you’re not much of a DIYer.
- Repair — Unless you think someone would pay an arm and a leg for your “distressed” fixtures or floors, you should patch every single crack and tighten every screw. Buyers who see small problems wonder what big problems could be hiding elsewhere.
- Modernize — If you have a home built over a decade ago, chances are that some aspects are out of date. Go through the house and find features like ungrounded sockets or dated, dim lighting and replace it with modern counterparts. Common issues include a lack of a ground fault circuit interrupter (GFCI), old fixtures like kitchen faucets, and aging appliances like hot water heaters.
- Paint — Painting your walls a light, neutral color is the quickest way to improve the appearance of your home. Light travels more, making spaces seem bigger. You also get rid of stains and wall defects. Just remember to use primer first, and also sand between coats!
- Renovating — Some remodeling projects like replacing your front door offer incredible return on investment. Others, like building an addition may not. Do your research and weigh your options before deciding to invest in renovations.
As your real estate agent, I can offer you advice on how far to go with aspects like remodeling, renovating, decluttering and repairs. I always perform a comprehensive consultation before, during and after the remodeling process to steer sellers towards a home look with the most universal appeal. I can also help you avoid sinking time and money into projects that offer little benefit.
With the help of your agent and a little elbow grease, your home will be ready for showtime.
Should You Stage Your Home?
Home staging is a hot topic among real estate agents and home sellers, but most people were “staging” before it was even called that. For instance, all of the preparation tips above could technically count as home staging.
Professional home staging, on the other hand, is a different beast altogether. This service can seem costly, but some homes benefit from it by greatly increasing the potential offer price. Namely: vacant homes, luxury homes, homes with dated décor and homes with unique appeal that increases the asking price. An example of the latter would be a townhome built in what used to be a quiet neighborhood that now sits near a hot strip of trendy businesses.
Like deciding what to remodel, the decision to stage your home involves weighing the potential benefits against the costs. Your agent can help you with this decision in order to maximize your return on investment.
Home Pricing Strategies and Considerations
More than anything else in the home selling process, deciding upon an optimal asking price for your home must rely upon science, knowledge, experience and hard facts. Since most home sellers do not have all of these tools at their disposal, this step makes having an agent critical.
Properly pricing a home foremost requires research. Your agent will have to review closing prices for homes within your neighborhood and similar properties within the vicinity — something they have much easier access to than the average person. They will account for unique features of your home, as well.
Your alternative is to risk pricing your home too high or too low.
Pricing high makes some sellers think they give room for buyers to negotiate. This attempt at “testing the market” can cause many to simply pass over your listing with the expectation that you will become more realistic over time, resulting in a lower closing price.
Pricing too low could mean receiving competing offers, but this does not always happen. In the end, someone may still want to negotiate the price down.
So remember one more time: First impressions matter! The first six weeks are critical for a listing, so a home priced fairly and within market expectations is more likely to sell near its asking price than a listing on the market for more than 90 days.
Marketing Tactics to Bring in Home Buyers
Marketing homes has become a diverse prospect in this digital age. Options include:
- Open houses are usually most effective in the first weeks or after a price drop, this event-type marketing draws real estate locals and interested home buyers out of the woodwork, increasing buyer networking opportunities.
- Home viewings are the bread and butter of home sales and an almost guaranteed part of the process. With a real estate agent, you don’t have to worry about scheduling home viewings or even being home when the buyer comes looking.
- Online listings gain tremendous traction, open up communication avenues and invite people to share. More advanced tactics available provide dedicated websites with photos and interactive feature listings, as well as convenient contact forms.
- MLS listings are almost 100% necessary and help spread your listing to real estate magazines and online listing services
- Traditional paid advertising like flyers and paid magazine ads can be effective for certain high-value homes
- Social media advertising can bring out friendly, interested buyers who come from recommendations by friends, which can be a powerful source of leads
- Agent networking should never be underestimated as a sales tool, especially when connecting sellers to highly motivated buyers with a house like yours in mind
How to Respond to Home Offers
First off, remember that a home offer should take the form of a Contract of Purchase and Sale. Verbal or casual written offers are not legally binding, which means you could end up turning away serious buyers in favor of someone who later backs out.
When you receive an offer, you can either:
- Accept the offer as is
- Reject the offer and turn the buyer away
- Counter the offer with changes that suit your needs better
Buyers receiving a counteroffer have the same options at their disposal: accept, reject or counter. Counter offers can continue until someone accepts or walks away.
Most buyers will include conditions or contingencies in their offer. The ones that are the most accepted and reasonable include:
- Home inspection clause — Allows them to rescind the offer if they find major home flaws as the result of an inspection
- Financing clause — Stipulates that they must be able to acquire a loan before they can buy the home
- Appraisal clause — Allows them to walk away should the home be assessed at a significantly different value than the market price, which can affect their ability to finance
- Title search clause — A title search checks that the home has no liens and that the deed covers all expected property
- Disclosure clause — Requires you as the seller to disclose all information that could be of interest, and if you hold out information it could incur penalties or a dissolved sale
- Good faith clause — Stipulates that you must have “acted in good faith,” which typically encompasses fair, honest practices rather than an attempt to deceive
Confident buyers may add additional clauses. Some may seem fair, while others may seem unreasonable. It is at your disposal to reject an offer with excessive contingencies or posit a counteroffer with more realistic terms.
Some possible contingencies include:
- Required repairs or renovations
- “Contingent upon home sale” clauses where the buyer must sell their home first
- A request that the seller covers closing costs
- Delayed move-in date, or a hastened move-in date
- Payment of home liens
- Additional cleaning or maintenance, such as a steam cleaning service or a tree service
- Other requests, which could even include them asking for some of the furniture already in the house!
Closing on Your Home Sale
Once you accept an offer, the buyer will perform their due diligence and conduct a home inspection, appraisal, title search and possibly a survey.
If the buyer can satisfy all of their contingency requirements, the contract moves towards completion. Upon the completion date, a lawyer or notary you have hired will perform necessary paperwork tasks, including:
- Settling the final details of the previous mortgage, properly discharging it
- Arranging for the title transfer
- Confirming payment of all outstanding liens and balances on your part
- Cutting you a cheque for the remaining balance on the home
Even though you have been paid, the new homeowner does not officially receive the title transfer and the keys to your home until the final assessment has been performed and the deal has been officially closed.
What Costs You Can Expect When Selling Your Home
Selling a home almost always means plenty of money in your pocket, but the process is not without costs of its own. The most important or common costs include:
- Mortgage prepayment penalty: varies — Some lenders pre-load interest into payments and penalize you for trying to pay early. Costs vary, but some lenders can charge significant fees, so review your options before selling
- Repairs and renovations: highly variable, ≈$500-$20,000 or more — Depending on the condition your home is in, you may be able to spend a tiny amount getting it ready or be forced to spend a lot to bring it up to market standards. Always research your options to see if you can obtain a worthwhile return on investment.
- Staging: $0 or ≈$2,500-$5,000 — Professional staging services usually bill monthly and start out at $2,500 to $5,000 for the first month. This fee usually includes the initial consultation and the process of moving all the furniture in. Some homes don’t need staging, but those that do like vacant homes may find staging costs greatly increase the offer price.
- Legal services: ≈$700-$1,000 — A lawyer or notary is required to legally complete paperwork such as a title transfer. These fees do not always include HST/GST, which can mean additional costs.
- Real estate fees: varies based on sales price — Real estate fees are highly variable and depend completely upon the agent, the home in question, the current market, the final offer and other factors. Depending on the sale type, you may also have to pay an additional HST/GST. Seller’s agents will also usually split the commission portion 50/50 with any buyer’s agents involved.
Your agent should present you with a contract for their commission and any fees before you agree to their services. Some charge a raw percentage, usually 5% to 15%, although more is certainly possible for luxury homes or complex sales. Others charge a table amount, which means a flat fee based on the final sales price. For instance, a $400,000 close could mean a $14,500 commission plus HST/GST, but a $1 million close could mean $29,500.
Contacting Me with Any Questions You Have
We understand that this is a whole lot of information to take in at once and that we have not covered all of the smaller details, but we would love to answer any questions you have in person! Simply contact me using the handy form, and I will respond as soon as I can to share my knowledge with you. Even if you decide I am not the perfect agent fit for you, I can refer you to someone who is and would love to answer your questions in the meantime!
Contact me today to start the process of selling your home now!