Essential Tips for Home Sellers

The First Steps

Selling a house is a complicated, multi-step process, as many factors have to be considered. First potential sellers should decide whether they want to sell their own homes or hire a realtor. During this pre-sale stage, you should have at least two appraisals done on your home, which will help you decide on a  reasonable initial pricing of the house. A home inspection is also highly recommended, so that any structural problems can be fixed during this early stage. Overall, think strategically and do not be intimidated by the process. Know who is buying and selling in your area, as housing markets differ from region to region, and know who your competitors are.

The Housing Market and Realtors

In difficult housing markets, selling a home can be tricky business. If you decide to work with an agent, choosing the right realtor can mean the difference between making a gain or a loss when selling your home. Rather than working with a real estate agency, work with a licensed realtor who is a member of the National Association of Realtors, as they tend to abide by a stricter code of ethics than other real estate agents. Realtors also have access to multiple listing services (MLS), which means they can access more housing listings than real estate agents. In other words, realtors are in a better position to help you price your home competitively. You should avoid “dual” agencies that work with both buyers and sellers, and choose a realtor that handles homes in your price range. Equally important is choosing a realtor whom you feel comfortable with, who listens to you and answers your questions.

In most cases, the largest number of showings for your house will happen in the first few weeks, so first-time home-sellers are recommended to price their homes competitively from the beginning. Pricing at the right amount and at the right time shapes the types of offers you will receive, as well as whether or not you will make a capital gain or loss when selling your home.

Gains and Losses

Calculating your gains and losses is a multiple-step process. You first need to know the selling price, which is set from at least 2 appraisals completed by trusted sources. You must also know the house’s basis, which is the amount of taxes tied up with the property. A more detailed way to think about costs basis is adding additional purchase costs, improvements and selling costs to the original purchase price of the house, then subtracting the amount of accumulated depreciation. Through the Taxpayer Relief Act of 1997, it is now easier for homeowners to make profits when selling their homes. The law allows homeowners to gain profits from tax payments on their homes and also allows them to take advantage of current per-sale exclusion amounts.

Timing also plays a significant role when selling a home. If selling the house is not an urgent matter, homeowners should wait to sell until the market is healthy. Putting your house up for sale when the local market is tanking will almost always guarantee a significant capital loss on your house. Know what your time frame is and avoid situations where you have to sell quickly.

The Sales Process and Reporting the Sale

In the initial listing, house sellers should include a selling price and a thorough description of the home, including its location and condition. Realtors should also provide sellers with a market analysis of their homes. This will familiarize them with the most competitive pricing for their homes. Make sure to also fill out the property condition form, which differs from state to state. Failing to sign off on it, which is a common misstep that home sellers make, results in a monetary gain for the buyer.

When a buyer is ready to place an offer, consider all the details involved, such as the mortgage, closing and occupancy dates, extra contingencies, personal property that may be included or excluded in the offer and the overall amount that the buyer is offering. If the offer is satisfactory, this will lead you to the closing, which is when all involved parties sign off on necessary forms in order to complete the transaction. After all forms are signed—this includes deeds, loan papers and other ownership and seller documents—you need to file them at the local property record office. The buyer then receives all the original keys in exchange for the payment for the house.

If you are thinking about selling your home, here is a recap of reliable and authoritative online sources you can use to start the process.

Authoritative Sources:

  • Realtor.com—Run by the National Association of Realtors, this is one of the most popular websites that home buyers, home sellers and realtors use. It includes a comprehensive listing of homes and also includes readings on how to choose the best realtor to fit your needs.
  • Zillow—Zillow is also another popular online real estate database and includes data on over 100 million homes in the U.S.
  • ForSalebyOwner—For those home sellers bypassing the realtor or agent, ForSalebyOwner.com is a helpful resource that advertises properties being sold online. It also includes a downloadable e-book that offers up “do-it-yourself” tips on how to sell your house without a realtor.
  • RealEstateABC—This online resource includes articles on the selling process, and gives advice to readers on a range of topics, from pre-sale preparations to showing your home to potential house buyers.

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