Thinking of selling your home now that our property markets are moving out of the government imposed Coronavirus cocoon?
Well let me tell you…Selling your home can be a stressful and confusing time.
As well as packing boxes, booking removalists and dealing with all of the logistics of the move, you also prepare to close the door on the happy memories you’ve made there.
What a lot of homeowners don’t realise is that, on top of all the logistical and emotional challenges that come with moving house, there’s a whole new world of legal jargon and processes involved in the actual sale itself.
Now, while I can’t pop around and help you wrap all your wine glasses in newspaper, I can help to take some of the stress out of actually selling your home.
In that spirit, I’ve put together this simple yet comprehensive guide, which should make navigating the process a lot simpler:
Tip 1: Get to know the local market and agents
Figuring out the right price to sell your home isn’t about working out how much you “think” it’s worth.
You need to get to know the local suburb – and the best real estate agents in the area – so you can get a real feel for the market.
Attend open home inspections and auctions for similar properties in the area, so you’ve got a good gauge of not only typical price ranges, but also of the modus operandi of local agents and auctioneers.
This, combined with word of mouth recommendations from friends and family, should help you narrow down your options and make a good choice when it comes time to appoint an agent to sell your property.
Which brings me to my next point…
Tip 2: Choose the best agent
To be clear here: best isn’t always cheapest.
It can be a fool’s errand to sign with the lowest-priced agent in the area in the belief it will save you money.
If they don’t have the right contacts or negotiations skills to get you the best price for your property, then you stand to lose a whole lot more than a few thousand dollars in commission.
It’s a good idea to interview at least three real estate agents before settling on the one you think can best represent your interests.
Have questions prepared beforehand – you’ll want to know about their commission structure and marketing fees, their past experience and sales record, and how their customer service will go above and beyond what others can offer.
Don’t be put off by seemingly high commissions – remember, the cheapest agent is actually the one who gets you the best price for your home, not the one who charges the lowest fees.
Some agents can get away with charging big bucks because they have the results to back it up.
In mind the best agents are great negotiators, and will work hard at getting you the best price.
Similarly expect them to negotiate hard on their behalf and not cut their commissions.
Tip 3: Give the property a spruce up
You don’t need to spend a fortune to get the place ready for sale.
But you do want to present it in its best possible light, which means attending to all the little bothersome nooks and crannies that could turn a buyer off your home.
Ask your agent for their advice on the improvements that are likely to matter most to potential buyers or increase your sale price.
Simple, inexpensive jobs such as applying a fresh coat of paint, having the carpets steam-cleaned or hiring a gardener to make the backyard look less high-maintenance can make thousands of dollars difference to the price you eventually achieve.
Decluttering can also have a huge impact, so now is the time to follow Marie Kondo’s example and discard your unwanted junk.
If you’re not ready to part with it, at least put it in storage so it’s out of sight.
Keep the styling neutral and remove personal photos where possible, so buyers can imagine their furniture and family in the space. The presentation of the property is important right throughout the sales campaign, not just for the photo shoot, so do your best to keep the place immaculate until the buyer has signed on the dotted line.
Tip 4: Research selling options
When you engage an agent to sell your property there are a number of ways you can do so.
You might give them exclusive sale authority, meaning they are the only agent who is able to sell your property privately for a given time, such as eight weeks.
Alternatively, you can give them exclusive auction authority.
Now I know some vendors like the idea of listing their home with more than one agent, giving each of them general sale authority.
I don’t think that’s a good idea.
You see…only the agent who successfully sells the property will be paid for their work, so some agents won’t work under this type of agreement, or won’t work hard if they’re not assured of the commission.
In my view, it’s generally best to select the best possible agent for the job and let them do their work. They will share details of the listing with other agents at their agency in any event, which widens the pool of prospective buyers.
Tip 5: Figure out your legal costs
In addition to the commission costs you’ll incur with your real estate agent, you’ll have to pay for a number of legal expenses, which may vary depending on where you live.
These can include paying for conveyancing, preparing sale and auction documents, and transferring the title to the new owners.
When selling a property, legal fees generally account for anywhere between $800-$1,500, but you can request an obligation-free quote before you make a commitment.
If you’re selling an investment property, don’t forget to engage a qualified accountant about the potential capital gains tax implications, too.
Tip 6: Stay on top of your legal obligations
As the seller of a property, you’re legally obliged to provide prospective buyers with documentation that relates to the Act in your state or territory.
In Victoria, for instance, this is known as a Section 32 Vendor Statement, and it details all the “need to knows” about the property.
This includes things such as body corporate or strata fees, title documents, any covenants or easements on the land, and council zoning information.
Fortunately you’ve already chosen a great lawyer at the previous step, so they can consult with your real estate agent to ensure you’re on top of this requirement.
Tip 7: Decide on your sales method: auction or private sale
Your agent can offer plenty of advice here, with facts and figures to back up which method is likely to best suit your property type, suburb and buyer demographic.
Now that we’ve been let out about Coronavirus cocoon, auctions are once again becoming common in our larger capital cities, especially Sydney and Melbourne.
If you got a great property, in my mind an auction is usually the best way to sell it especially if you find a couple of keen buyers.
Of course, not all properties are best sold by auction and in regional markets or the outer suburbs of our big cities, auctions are not as commonly used and private treaty sales are the more standard approach.
Ultimately, you need to feel comfortable with your choice and if the idea of an auction is too much stress to bear, don’t feel pressured into agreeing to one.
A hybrid option might be a “sale by tender”, where you list the property for sale, and set a date by which any interested parties must submit their best and final offer. Your real estate agent can provide the most relevant advice in this regard.
Tip 8: Set that all-important price guide
Whether you decide to sell by private treaty or auction, you’ll need to decide upon a sale price guide.
Your agent can advise you on whether listing with a firm price (eg. $750,000), a range (eg. $700,000s) or an “offers over” style (eg. $749,000+) would work best.
If you’ve opted for an auction, you’ll have to set a reserve price.
It’s a delicate balance between aiming high and putting off potential buyers with your expectations.
Keep in mind that online listing sites give people the option to refine their search by price bracket, so you may find that a $799,000 price tag sees your home appear in more search results than $800,000.
Tip 9: Choose your inspection and auction dates
Weekends are popular for open homes, but it may be a good idea of offer a weekday evening option for those who aren’t able to attend on weekends due to other commitments.
Also, be prepared for the agent to ask to bring buyers through for private inspections, especially those who have requested a second or third viewing of the home.
When it comes to setting the auction date, again, weekends are the norm. But remember to look ahead on the calendar so you don’t schedule the auction on the same day as a major event, like the AFL Grand Final.
All that’s left now is to launch that sale!
Your property will be “launched” onto the market, appearing in local newspapers, in brochure form in the real estate agency window, and of course, online.
A “For Sale” board will be erected in a prominent spot, with professional photos to lure in potential buyers.
Your agent will conduct open homes, follow up interested parties, and try to drum up excitement before the auction, if that’s what you’ve chosen.
Remember, they’re working for you, so don’t hesitate to use them as a sounding board when considering offers or deciding your next move.
An experienced and qualified real estate agent will be there to hold your hand and provide you with strategic advice and reassurance that they’re doing all they can to get the property sold.
Michael Yardney is CEO of Metropole Property Strategists, which creates wealth for its clients through independent, unbiased property advice and advocacy. He is a best-selling author, one of Australia’s leading experts in wealth creation through property and writes the Property Update blog.
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