Selling your home
Some wonderful memories were made in your home, but when it comes to selling, it's no time to get overly emotional. You need to put personal feelings aside and look at the situation for what it is – a business transaction.
Think about when you bought your home. Did the previous owner's feelings impact your view of its value? Did their Elvis-themed room where the family gathered on holidays to sing along with The King resonate with you? Your favourite room, no matter how special the memories, probably won't do anything for potential buyers, either. To sell your home, you need to become objective and follow these steps.
Find a realtor
In an active market, you can sell your home yourself, but do you have the time and know-how to do the job effectively? For their fee, a realtor markets your home, researches similar properties, takes care of written processes, qualifies potential buyers, updates you on progress, and more.
To find the right realtor, ask for referrals from people you trust. When you have a list of candidates, interview them to determine their experience, knowledge, commission, success ratio and how they would approach selling your home.
Price your home – realistically
Your realtor will prepare a comparative market analysis outlining similar homes in your area and their asking price. Chances are you already have a price in mind. Talk with your realtor to see if it matches current market prices. If you believe your house should be priced higher, explain what selling features make your house a better value. You don't want to price too high and miss potential buyers, but you also don't want to price too low. Your aim is "fair market value" – a price that both you and the buyer will feel good about.
Complete a listing agreement
This defines the relationship with your realtor including the length of the contract and if you've chosen an "exclusive listing" or a "multiple listing" (MLS listings are available to all local real estate board members, reaching a larger audience).
The listing agreement needs to outline assumable financing options, list price, commission payable upon a completed sale and which items will stay with the house. You will also be asked to complete a seller's property information statement where you will disclose defects. This is not the time to leave out that the basement leaks in the rain or that the gas fireplace doesn't work!
Prepare your home for sale
Get your home in tip-top shape for viewings: clean and de-clutter everywhere, make needed repairs, tidy the yard and outdoor spaces. Think about the first thing a potential buyer will see. If possible, try to "neutralize" each room by reducing the number of family photos and personal items on display. This allows potential buyers to imagine living in the space.
Have an impartial friend or family member look at the house when you think it's ready. If you need additional help, you might consider a professional stager - someone who redecorates your house to appeal to a wider range of buyers. Remember basics like taking the garbage out to keep the house smelling fresh.
When an offer comes in, you have three choices: accept, decline or counter.
- If you accept, you accept the offer as it stands.
- Declining means you reject it entirely.
- Counter-offering means you are rejecting the offer, but are making a new offer to the buyer. Counter-offers may go back and forth until an agreement is reached or one of the parties declines.
Offers will contain: offered price, date for completion, date for possession, a list of fixtures that the buyer wants included (refrigerator, drapes, etc.), and subjects or conditions that must be fulfilled before the sale is considered complete.
Subjects outline a specific condition or task that must be fulfilled for the sale to go through. Standard subjects can include an acceptable home inspection, approval of satisfactory financing for the buyer or the sale of the buyer's current home. If every reasonable effort has been made and a subject has not been fulfilled by the deadline, the contract ends and the purchase of the sale collapses.
Schedule a home inspection
An inspection is a standard subject on most sales and is paid for by the potential buyer; therefore, the results are for the buyer, not the seller. Often, nothing unexpected is found, but there are occasions where major issues are discovered and the buyer may choose to revoke the offer, discount the offered price or accept the defect as part of the original offer.
Inspections do not require anything from the seller other than to make the home available. Some inspectors are willing to answer questions posed by the seller, but others reserve their findings only for the buyer.
Finalize your mortgage and closing costs
It's important that you inform your legal representative and your financial advisor once you've accepted an offer. Your legal counsel will ensure that all documents are accurate, your mortgage has been properly discharged, a statement explaining the disbursement of proceeds from the sale is prepared, and all necessary documentation is signed.
If you're purchasing another property, you may be able to transfer your mortgage and either avoid or reduce any prepayment penalties. Discuss your intentions with your financial advisor to help save time and money.