Selling Your Home
Seven Essential Considerations when Selling Your Home
Selling your home is one of the largest and most important transactions you will ever carry out. It is worth taking the time to familiarize you with the process. To help you get started, read the following essential considerations.
1. Time Your Sale
The rate at which your house sells and the amount you get paid is affected by the market and the time of year. In order to get results in line with your expectations, consider:
- Your own time-line for selling
- Whether this you are selling in a buyer's, seller's or transitional market
- Seasonality and how it effects buyer behaviour
2. Market Effectively
The chief determinant as to whether your home will sell is your ability to reach a targeted buying audience. To find qualified buyers, know that:
- Most buyers are using the Internet to gather information. The Multiple Listings service will give you wide-reaching exposure.
- A well-connected Realtor® will have access to a buying client base and a professional network of buyer's representatives
3. Get Your Home Market Ready
View your home as a product that must contend on the market with new housing. For a good return, get it into sound condition and present it well by:
- Completing repairs before putting it on sale - most buyers who see a construction site will not visualize the finished product, but will perceive further expense
- Removing clutter - a "lived-in" but tidy looking house will show prospective buyers that the property has been cared for
4. Price Effectively
If you price your home too high, it can linger on the market, but you can lose money by under-valuing it. A qualified appraiser will help you arrive at the property's fair market value, based on measurable factors such as:
- Comparable prices in the neighbourhood
- Replacement cost of the house
- Market trends
- State of repair and impending expenditures
5. Know Your Legal Obligations
When selling a house, there are regulatory considerations and contractual obligations to consider, including:
- Listing agreement, the contract between you and your agent; this will be either an Exclusive or a Multiple Listing Contract.
- Ensuring that title is clear of claims against the property
- Disclosure of known material latent defects - problems that cannot be found through a standard inspection
- Accepting an offer - once you accept an offer, you are legally obligated to carry out the sale
- Property disclosure statement - this recommended form goes beyond disclosure required by law. It itemizes the existence of potential problems ranging from structural problems, unregistered easements, unauthorized accommodation, hazardous material, former grow-op and so forth
6. Anticipate Financial Obligations
There are costs to selling property. Be prepared to account for:
- Existing mortgages. Contact your lending institution to find out whether the buyer can take over the mortgage, whether there is a prepayment penalty or if the mortgage is portable.
- Taxes such as the HST and Property Transfer Tax are paid buy the buyer, unless you include them in the price of the home. If it is the end of the year, you will have to pay your property tax unless otherwise specified.
- Professional fees that you will incur professional real estate services
7. Use Professional Services
Sources: Real Estate Council of British Columbia, the Real Estate Board of Greater Vancouver, the Canadian Home Mortgage Corporation, the Canadian Bar Association, and our own Realtors®.
Selling a home is a complex process. Some people choose to go the "For Sale by Owner" route, but many of them are finding that there is more involved than they first anticipated. Hiring qualified professionals will remove stress from the process and ensure that nothing is left to chance.
- A real estate licensee can market your home, refer you to other qualified service providers, help qualify offers and assist with the legal processes.
- A notary public or lawyer will help ensure your best interests are being protected
Home Renovations Add Value to a House for Sale on the Real Estate Market
A question Realtors® are often asked is, Should I renovate before putting my home on the market?
The short answer is, It depends.
Find out if it is worth it
A cost-benefit analysis will determine whether the market value of your home after the upgrade, when added to the cost of the renovation, is less or more than what other comparable houses in your area sell for. If your two-bedroom bungalow is worth $250,000 as-is, a $30,000 renovation could potentially bring its value up to $300,000. If nearby two-bedroom similar in age and style recently sold for the same or more, you stand a good chance of earning $20,000, which takes care of your listing agent's commission. If those houses sold for $275,000, spending that money could end up costing you $5,000.
Housing resale price is affected by the value of similar houses in the same area, and even a beautifully remodeled home will be affected by these external forces. If you are motivated to sell, you do not want to spend more than you can easily recoup, unless you are in a position to wait.
Going ahead with the renovation
What should you renovate? If the house has pressing weaknesses that present a danger or an exorbitant hidden cost, many real estate boards require disclosure, and the buyer's inspector will surely find it. If you fix it, be sure to use reputable sub-contractors so that when it is inspected, it will be up to code. If you decide to leave the repair to the next owner, the buyers will have more bargaining power and the house will sell for less.
Some renovations are more effective than others at increasing the appearance and value of your house. Provided there are no major flaws in the house, and you have leeway to spend, consult with your REALTOR® to find what the most effective renovation to make is.
Value added - from basics to add-on features
A skylight or a gas fireplace is attractive add-on features if everything else is in good condition. Otherwise, it might make more sense to repair an existing issue such as an old furnace or basic insulation in the attic.
A renovation that improves energy efficiency is usually a good investment for several reasons: it may appeal to increasing numbers of buyers who are concerned about the effects their lifestyle has on the environment. These kinds of repairs will also save the homeowner money over time. Depending on the improvement, money can be saved on heat and power. Certain repairs may qualify the homeowner for tax incentives and rebates from utility providers.
If it is in your budget, a remodeled kitchen is typically a reliable investment. It is the workhorse of a household, and clean, durable design is attractive to buyers. In the same vein, bathrooms are also good to upgrade. Cleanliness leaves a strong positive impression with buyers, and nothing shows that like a gleaming, modern low-maintenance bathroom.
Going Forward - Whether to DIY or hire a professional
You may be handy, but be honest with yourself. Major renovations are tough, must be up to code and almost always cost you more than you first thought it would. If you are a skilled amateur, the money you think you are saving may be lost in time spent, materials wasted and substandard results. If you are not a trades person, it usually makes sense to hire a general contractor or several subcontractors, who will do the work twice as fast.
Though we strive to ensure that the presented material is reliable and correct, it is intended for informational use only. ECO Realty Inc. does not guarantee this material's accuracy or completeness. The information presented by this material is not intended, nor should it be relied on as a substitute for professional certified legal advice in real estate dealings or any other dealings of a binding legal nature.