Frequently Asked Questions From Home Sellers
Q: Is there a "best time" to put my house on the market?
A: Along with economic factors such as supply and demand, the time of year you choose to sell can impact both the length of time it takes to sell your home and its ultimate selling price. Weather conditions are more or less of a consideration depending upon where you live. Typically, however, the Real Estate market picks up around February, continues strong through late May and June, and tapers off during July and August. September through November generally marks a rally not as strong as late winter and spring, followed by a slowdown from Thanksgiving through and beyond the Christmas and New Year holiday period.
Q: How should I price my home?
A: You must take into account the prevailing state of the Real Estate market and especially local market conditions. The Real Estate market continually changes, and market fluctuations affect property values. So it is critical to determine your listing price based on the most recent comparable sales in your neighborhood. A comparative market analysis provides the background information on which to determine your listing price. Review the comparable sales data provided to you by the different Agents you've interviewed. If all agree on a specific price range, you're wise to go with this consensus. And be wary of an agent whose opinion of value is much higher than the others.
Q: What's the downside, if any, of pricing my home on the high side?
A: Several factors may come into play:
- You might help sell similar homes that are priced lower.
- Your home may be on the market longer.
- You could lose market interest and qualified buyers.
- You might create a negative impression of the property.
- You could lose money as a result of making extra mortgage payments while incurring taxes, insurance and unplanned maintenance costs.
- You may have to accept less money.
- A potential buyer may face appraisal and financing problems resulting from the inflated price.
Q: How long should it take to sell my home?
A: Here again, it depends upon market conditions. But if your home is priced right and in good condition, you should be able to expect the minimum market time in your area. On the other hand, if your home is overpriced and needs work, the opposite likely will be true.
Q: As a seller, what are my disclosure obligations?
A: Obligations to disclose information about a property vary from state to state. The focus on disclosing defects has become more intensive in recent years, often including locally mandated disclosure forms for revealing any material defects. Typically, you must disclose all the facts affecting the value or desirability of your property that are known or accessible only to you. For example, you are required to indicate any significant defects of which you are aware about the home's major systems, the presence of environmental hazards, room additions or repairs made without the necessary permits or not in compliance with building codes, zoning violations and much more.
Q: What should I do to prepare my house for sale?
A: There are many things you can do to make your home show better without spending a lot of money. Following are some things you can do to make sure would-be buyers are impressed when they arrive, also known as "curb appeal."
- Paint your front door, shutters, trim and any other outside features showing signs of wear.
- Wash windows inside and out, replace screens or glass as needed.
- Replace faded wallpaper and/or glue areas that have come loose.
- Repair worn woodwork.
- Repaint scarred or dirty walls in a neutral color.
- Steam clean carpeting or replace it, if necessary.
- Repair loose knobs, sticking doors and windows, warped cabinet draws, broken light switches and other minor flaws.
- Check and repair caulking in bathtubs and showers.
- Open draperies and curtains to let the light in during the showing.
- Keep fresh, clean towels in the bathroom.
- Use candles or air freshener to give rooms a pleasant scent
- Strategically light your home, even during daytime showings, to create a cozy mood and highlight positive attributes of each room.
Q: Many discount Real Estate brokerages charge a very modest fee for services. Why shouldn't I use one of them to sell my home?
A: Typically, all discount Real Estate brokers do is to put homes in the multiple listing service. They won't guide you through the sales process, market or show your home, qualify your prospective buyers, handle the often-delicate negotiations with buyers or do many other vitally important things that a full-service Real Estate professional will do on your behalf and best interest.
Q: How can I be sure a buyer is qualified and that their loan is not questionable?
A: This is another valuable service your listing agent will provide. An agent representing you as seller should communicate with the lender in advance and have some assurance that the buyer is pre-approved for a loan at the onset of the contract negotiations. Ideally, the buyer is a non-contingent buyer and a pre-approved buyer.
Q: Do I have to sell to the person with the highest offer?
A: No. If you prefer a lower-priced offer, perhaps with a better-qualified buyer and/or more attractive terms, you can accept that offer instead. Or you can give counteroffers to one or more of the buyers. Beware, however, that if you turn down a full-priced offer, you may owe your agent a full commission even if you decide not to sell your home.
Q: Can I back out of my contract with one buyer and accept a new, higher offer from a second buyer?
A: It is very unwise to try to back out of the contract because a purchase offer that's accepted is a legal contract that the buyer can seek legal remedies to enforce.
Q: Who is responsible for making repairs, if any, as a result of home inspection reports conducted for the buyer?
A: Because the buyer orders one or more home inspections doesn't obligate the seller to make repairs or modifications as a result of those inspections. Typically, however, inspection reports are used to negotiate repairs of major problems, or environmental or safety hazards that may be noted. The purchase contract should provide guidance for these negotiations.
Q: How do I calculate the net proceeds on the sale of my home?
A: From the proposed purchase price you typically subtract:
- Balance on your present mortgage.
- Other liens, if any, such as equity loans and judgments.
- Broker's commission.
- Legal costs of selling, such as escrow agent's and attorney's fees.
- Transfer taxes.
- Unpaid property taxes and water bills.
- If required by the contract, items such as the cost of survey, termite and other inspections, necessary repairs, buyer's closing costs and more.
Q: What if as a potential Seller, I decide to defer selling and, instead, rent my home?
A: If and when you decide to sell your home, you will not be eligible for a tax-free capital gain - up to $250,000 for one person and up to $500,000 for two - unless you've lived in the home as your primary residence for at least two of the five years before you sell.
Q: Is the tax-free capital gain on a home sale a one-time benefit? Also, must I reinvest that gain in another property?
A: The answer to both questions is no. You can qualify for a capital gain with each primary home you own and sell and can do this every two years if you so choose. As well, it is not necessary to re-invest your proceeds in another home.