Home Sales Order Of Operations – Everything You’d Want to Know
Selling your home can be an extremely stressful time in your life. Not including the effort taken to actually decide to sell, the process of selling your investment can seem like a daunting task if you don’t fully understand the process. Luckily for you, we’ve collated everything you’d want to know about selling your home – in particular, the order of operations for the sales process. So, in 10 simple steps, here’s how you can expect your property sale to unfold:
- Decide When to Sell
Before you decide to sell your home, it’s important to determine if the timing sits right for your future plans. Sure, selling your property can give you a cash boost (if sold for a profit) and prove a powerful wealth-building tool, but it can also be a burden if the timing isn’t right. Consult your personal and financial future plan to see where a sale fits in, and if it will have a positive flow-on effect for your future goals.
Once you’ve done that, then you need to assess if the time is right for a sale. You may need the assistance of a professional real estate agent for this. They have an active knowledge of market conditions, and can more accurately assess both your property’s value and what you can potentially get with a sale under current market conditions.
- Get a Real Estate Agent
If you’re planning to sell your property, then a professional realtor is a must to ensure a smooth, profitable transaction. Acting as a third-party, a property manager will treat your home like an investment business, ensuring that profitability of sale is at the forefront of all decision-making. A real estate agent will generally take a commission in the range of 3% to 5% of your sale price, so it pays to compare what they can offer you, their track record, testimonials, and any sales data they can provide which may indicate their performance. Look for names on signs in your neighborhood, or search online for realtors close to you.
- Sign a Listing Agreement With an Agent
Once you’ve found a suitable realtor, you’ll be required to sign a listing agreement. The listing agreement will define the legal relationship between you and the agent, and also set a time limit to sell your home.
- Determine a Realistic Asking Price
Setting a realistic asking price is the most important aspect of selling your home. Without a price that is attractive to buyers, having a beautiful, well-presented home will be a waste of time. You need to set a price that will stir interest in the marketplace, attract buyers to inspections, and will pay you a maximum return on your investment. A high price can be a turn-off, and setting a low a price may mean you miss out on thousands of dollars. Your goal is to find fair market value, and a professional agent will be crucial in assisting you with your final value.
- Find a Good Attorney
Depending on which state you reside, it’s common for a house sale to be handled through escrow in the U.S. In many states, attorneys act as the escrow agent and title inspector. Elsewhere, escrow transactions may be conducted by licensed escrow agents who often are affiliated with or who own a title insurance company. So once your agent lists your home on the market, it’s important to find a good attorney to act on your behalf and perform the property transaction, finalising the sale. If you’re going through a property agent, it may be worthwhile discussing this with them to see if they can recommend a reputable attorney they’ve used in the past.
- Prepare Your Home for Sale
It may not have been a priority beforehand, but now that you’ve listed your home on the market, it’s not too late to prepare your home for sale. Making sure there are no maintenance jobs outstanding is a great start. Make sure you search high and low, and ensure that you fix anything that’s broken or looks like it might break. That piece of flashing that keeps popping out, the missing paint on a windowsill, the rickety drawer in the kitchen you’ve been putting up with for years; if a seller walks through your house and spots petty things like this, then they’re likely going to ask themselves how well you’ve maintained the rest of your place.
The next obvious preparation step is to ensure your home is tidy and appealing to the widest audience possible. Ideally, you want a potential buyer to feel like they could move in straight away with their things. Those collectible china dolls, the antique foot rest, and the array of family photos you’ve got hanging up as decorations make a prospective buyer’s ability to imagine your home as theirs much more difficult. Remember, you want your home to look like a hotel room: neutral and appealing to the majority.
- Step Back and Breathe
You’ve done the hard work and your home has never looked so good. Now it’s time to give yourself permission to step back from the sale process and let your real estate agent handle the marketing to potential buyers. Normally, this begins with a “For Sale” sign on your front lawn, open houses, newspaper ads, and a listing on the internet. There’s little you can do in this step, so you may as well go and have a holiday to take your mind off the stressful weeks leading up to this point!
- Prepare Your Finances
Financially, a sale and transfer of title can happen a number of different ways. It’s important to understand if the buyer will “assume” your mortgage from you or if you will “discharge” it altogether. Then, if you’re selling your current home to buy a new one, knowing if your mortgage is “portable” can be valuable knowledge. Then there is a list of taxes that are involved as well. This is important information to obtain from your attorney, mortgage lender, or your listing agent.
- Receive an Offer
When the offers start coming in, it’s advised you employ the expert services of your listing agent to negotiate on your behalf. Negotiating a deal for investment property is an art, and unless you’ve got the background knowledge of the market, you could be sabotaging the value of your investment. Although your listing agent will keep you well informed of the progress without your need for direct involvement, be prepared for some stress. You will see every offer and will have three options: you can accept, you can reject, or you can “sign back” or “counter”.
- Close the Deal
Once you’ve got a contract signed, sealed, and delivered to your attorney for processing, you need to start satisfying any conditions of the legally binding agreement immediately. Some of these items will require your direct attention, and some will require you to get the ball rolling with your financial institution or listing agent. Come closing day, your lawyer or notary public will finalize all the details and give you a cheque for the net proceeds.