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When you decide to sell your home, chances are you're caught
up in a host of emotions. You may be looking forward to moving up to a new
dream house or facing the uncertainty of a major move across country. No
matter what feelings you're experiencing right now, there are plenty of
practical matters that need your attention.
Run the Numbers
Many Web sites have interactive calculators to help you
reach a decision about whether to buy or rent your home. Even if you're
not contemplating a change in your housing, you'll have fun looking at the
possibilities and dreaming up your own scenarios.
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Homefair is the National Association of Realtors site for all kinds
of information about homes and home buying. You will find the rent vs.
buy calculator under "Financial Calculators" in the left margin. It
lets you figure in variables, including your tax bracket, property tax
rate, and expected appreciation rate, then advises you of how much you'll
save or lose by renting or owning your own home.
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American
Bankers Association tells you what size mortgage you could get if
your money were going toward a house payment instead of rent.
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CCH Financial
Planning Toolkit is the most detailed site, with the most variables.
This is the one to try out if you want to know whether to sell your
house, invest the proceeds and rent a condo in the Pearl District or
over on Nob Hill. Click on "Financial Calculators" and then "Rent vs.
Buy."
What Home Buyers Want
 Buyers
want a home that does not have problems! They don't want to buy a
leaky roof, a dripping faucet, electrical outlets that are unsafe, etc.
Yes, some buyers are willing to purchase a home and update it and a handful
are even willing to buy a complete "fixer." But these are the exception.
If you have a home that is a "fixer", then it should be
sold as a "fixer." I've seen many of these homes in which the selling
agent advertises them as a "home needing TLC" instead of being what it really
is: a "fixer."
A Typical Home Sale
In a typical home sale, a real estate agent will suggest
to the seller some cosmetic repairs so they can get the home on the market
quickly. Then the problems begin. Prospective buyers come into
the home and observe the visible problems such as a roof that obviously
need repairing or replacing. I have seen the glazed over look on many
buyers in such homes. We walk out the house and they shake their head
and say, "Hopefully the next home will be in better shape."
And the worst is yet to come. Because even after
the selling agent get an offer, a home inspector will examine the home and
write up a report. Then the negotiations begin about who pays for
what and what gets repaired. Every real estate agent can tell you
about transactions that fell apart over a few dollars of repairs.
Just because one of the parties felt they had already given too much and
they said, "I am not going to give another inch."
Susan's Proven Method of Selling Your Home
 My
method of selling your home is exactly that, a method. It is not based
on promises and excuses. It is based on a simple fact that a home that is
ready to be moved into sells at the maximum market value. My method is based
on eliminating all the problems upfront. Here is how it works:
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We ascertain the condition of the home so the first
thing we do is order an inspection from a licensed home inspector.
I pay for this service.
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We go over the home inspector report and determine
what items need to be repaired immediately and which ones may need to
be negotiated with the buyer.
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We arrange to do any repairs. This may mean simple
things like painting. But it could also mean replacing a sewer
line (this applies to older homes).
We now have a home that is ready to sell. It is waiting
for buyers! The home is "Move In" ready. We have an inspector's report
and "list of repairs made" to show prospective buyers. They give a
sigh of relief because we have eliminated the nightmare of "repair issues."
The "Susan Method of Selling a Home" has worked once again.
Call me at (503) 497-2984 or complete the "Sell my Home"
form at www.movingtoportland.net/sell_home.htm
to get your home "Move In" ready.
Check Your Curb Appeal
A home that's visually appealing and in good condition
will attract potential buyers driving down the street. Use this checklist
to view your property through an outsider's eyes.
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Are the lawn and shrubs well maintained?
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Are there cracks in the foundation or walkways?
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Does the driveway need resurfacing?
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Are the gutters, chimney and walls in good condition?
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Do the window casings, shutters, siding or doors need
painting?
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Are garbage and debris stored out of sight?
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Are lawn mowers and hoses properly stored?
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Is the garage door closed?
On the Inside
 Strong
curb appeal will lure potential buyers inside, where you have to live up
to their expectations. Fortunately, there are plenty of easy improvements
you can make to your home's interior without spending a lot of money. Cleaning
is No. 1. Your windows, floors and bathroom tiles should sparkle. Make sure
you have clean heating and air conditioning filters. Shampoo dirty carpets,
clean tubs and showers, repair dripping faucets and oil squeaky doors. Keep
your home neat, clean and picked-up at all times. It may not seem fair,
but a peek in the oven may be the hallmark by which a buyer judges how well
you have kept up your home.
Remove unnecessary clutter from the garage, basement, attic
and closets. Also remove any items that might make a statement that would
be offensive to others who may not share your same views, beliefs or sense
of humor. If your home is crowded with too much furniture, consider putting
some things into storage. If a room needs a fresh coat of paint, use a neutral
off-white. Think, too, about how your home smells. You may be used to the
smell of a pet or cigarettes, but such odors can be a strong turn-off to
others. Be certain to remove valuables such as jewelry and other items from
view. It might be wise to put these items in a safe deposit box before showing
your home. Finally, set a mood for the buyer. Make your house homey with
live flowers and fresh guest towels in the bathroom. Place scented potpourri
around the house or, on the day you're expecting a potential buyer, pop
a batch of frozen cinnamon rolls into the oven for a welcoming aroma.
Remember, cosmetic changes do not have to be expensive.
It's attention to the basics — anything that says "this home has been carefully
maintained" — that will help you get the maximum market price.
Time Becomes Money
It's a good idea to place your home on the market as far
in advance as possible of purchasing a new one. If you find a new home first
and then try to sell your present home, you may wind up with two mortgages.
If this does happen, I can arrange to help you find a bridge loan to help
you make the double payments. Lenders use the same criteria for offering
bridge loans as they use for mortgages. Should you qualify for a bridge
loan, beware of the expense; during the term of the loan you must continue
to pay both mortgages. Shop around for the best terms.
Keep in mind that when people move, sell and buy, there
usually is a domino effect. Closing and moving dates have to be coordinated,
and the more firmly everyone commits to a window of dates and sticks to
them, the better for all involved. Put all agreements about dates in writing,
and protect yourself by negotiating financial penalties for failure to comply.
Go It Alone—or Choose an Agent?
Some homeowners decide to sell their homes themselves in
order to save the commission charged by a real estate agent. The commission
rate may vary, depending on where you live or what agency you choose, but
it is generally upwards of 6%. However, handling your own sale means you
will be responsible for placing ads, answering phones and showing your home
to strangers. Buyers who know you are saving on an agent's commission
may offer less for your home, wiping out the financial incentive to do it
all yourself.
Here are some of the advantages professional agents offer:
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They will help you establish a fair asking price
for your home.
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They will promote your home to other agents and
list your property in multiple listing services. A multiple listing
service is a book or computer database that all real estate agents who
subscribe to the service can access. Your home will get exposure to
all those agents, one of whom may have the perfect buyer.
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They will create, pay for and place advertising
for you.
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They will schedule appointments to show your home
to prospective buyers even when you are not there.
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They can weed out buyers who will not qualify for
a mortgage.
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They can refer you to sources for insurance, inspections,
repairs, and financing.
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They will help you negotiate with the buyer.
Setting a Fair Price
Naturally, you want to get top dollar for your home. But,
at the same time, you don't want to scare off potential buyers with a price
tag that's too high. Setting an artificially high price may cause your property
to languish on the market for months. Reducing your asking price later on
may lead buyers to wonder if there is something wrong with your home. Here
are some of the factors to consider in pricing your home.
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Your location
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Economic conditions
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Supply and demand in the local housing market
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Seasonal influences
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Local schools
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Average home prices in the neighborhood
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Your home's extras -- pool, fireplace, central air,
etc.
To determine the value of your home, you probably will
want the advice of a real estate agent or appraiser. Ask an agent to prepare
a market analysis for you, showing the recent selling prices of three neighborhood
properties comparable to your own. The agent can help you adjust for the
unique features of your own property.
Qualifying a Buyer
Either you or your agent will want to quickly weed out
potential buyers who cannot really afford to purchase your home. A number
of factors will help determine whether or not you are wasting your time
negotiating a sale.
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The buyer's debt and credit history
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The buyer's current income and employment
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The buyer's cash position and availability of a down
payment
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The length of time the buyer needs before closing
on your home
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How interested the buyer appears to be in your home
versus others
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Determining which closing costs are to be paid by
the buyer and which by the seller
Tax Implications
Selling a home can have a major impact on your federal
and state tax returns. Check with your tax consultant on the factors that
may affect taxes resulting from the sale of your home. For example:
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Whether you purchased the home or acquired it by gift
or inheritance
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Whether you used your home partly for business or
rental
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Costs associated with selling your home
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Home improvements or additions, which may help to
offset capital gains
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The sale of your home. In certain cases you can exclude
up to $250,000 in gain ($500,000 for married couples filing a joint
return) on the sale of property that was your principle residence for
at least two years. Generally, you can use this exclusion every two
years.
For More Information
100 Questions Every Home Seller Should Ask
Ilyce R. Glink, Times Books $14
Call 1-800-793-2665 to order and mention reference number 032-02. Price
and availability subject to change without notice.
The American Bar Association Family Legal Guide
Available at
www.amazon.com.
How to Sell Your Home in 5 Days
William G. Effros, Workman
Publishing $14.95
The Consumer Bible, 1001 Ways to Shop Smart
Mark Green, Workman Publishing
$14.95
Tips and Traps When Selling a Home
Robert Irwin, McGraw-Hill
$12.95
PAMPHLETS FROM THE FEDERAL GOVERNMENT
The
Federal Citizens Information
Center lists more than 200 helpful federal publications. The section
on "housing" has over 30 publications. Most can be downloaded (PDF
format) for free while others can be purchased. Groups and individuals
who wish to receive free copies of the Consumer Information Catalog each
quarter can subscribe at
http://www.pueblo.gsa.gov.
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