There are a few things to do before putting up the ‘For Sale’ sign, so to make sure you have all the information you need to ensure you get your dream result, here are our top ten tips to selling your property like a professional.
Arming yourself with the right information and advice can help ensure your sale process is a profitable and enjoyable experience. Research your local housing market. If you have lived in your current home for at least a couple of years, you’re likely to have a general idea of housing prices in your neighbourhood and local economic conditions. However, it’s still a good idea to do some homework on housing activity in your area including how many houses are on the market, average number of days to sell, and the average sale price. Look at comparable homes in your area to get an idea of what the competition looks like. This will prepare you for when the time comes to talk to your agent (knowledgeably) about the marketing plan for your property.
Consider regional and national trends and fluctuations. Look at inventory levels — the supply of properties for sale — and the average time it takes between listing and selling a home across your city, region and the country. As buyer demand surges, properties sell faster and sale prices increase, reflecting the level of purchasers’ confidence. What is happening politically? Are there any other upcoming national events which are likely to impact the economy, and in turn, the property market?
And don’t forget, engaging an agent who knows the area and understands the market can play a valuable role as matchmaker between your home and the right buyers.
You wouldn’t buy a house without getting it checked out by a professional first, so the chances are, your potential buyers will do the same. Big bad surprises can turn off even the most enthused buyer, so consider getting a thorough inspection of your home done prior to selling. This will highlight any issues that you don’t already know about and let you decide on a course of action — would you reduce the price to cover a repair that is needed? Or will you get it fixed prior to sale?
Choose a qualified, independent and experienced builder to carry out the inspection. As part of the process they will examine the house thoroughly and look for things like structural defects, areas where there is damp or mould, areas which need repair or repainting, any issues with weather-tightness, wiring, plumbing and foundations. An inspection should look at the whole building including the ceiling, underfloor spaces and any fences or outbuildings.
The major advantage of getting your own inspection is that you stay in control of the selling and negotiation process. By identifying problems early and on your own terms, you can fix them to your financial advantage. You’ll also have the time to shop around to find the best deal on home repairs rather than agreeing to the buyer’s terms to have repairs completed by settlement. Through an inspection you might even find ways to fix problems inexpensively on your own. While some might see a builder’s inspection as unnecessary for the seller, it’s always better to have your own report rather than simply taking a buyer’s word for it.
So, you’re ready to list your house and move on to the next property … but let’s hold up just a second. Before you dive belly first into the Olympic sized property selling pool, make sure you have double and triple checked you have all of your finances in order. A quick financial WOF prior to selling your home will let you examine what’s under the hood, and ensure you’re sitting pretty before you get into the nitty gritty!
What does your financial situation look like right now? Do you have credit card debts to pay off, insurance payments due, a hot water cylinder you need to replace and a rotten deck that is in dire need of attention? Ensure money-sucking must dos are taken into account when looking at the real cost of selling your home. Doing so will save time and future headaches.
Have you checked out the best mortgage options for your next purchase? This is particularly important if you’re trading up. A mortgage broker or bank will tell you how much you’re eligible to borrow, but you’ll need to decide what you can afford to borrow. That’s not only in terms of mortgage, rates and maintenance costs, but also your financial goals.
Consider the total cost of moving. We’re not talking about a man and a van, but the associated increases in mortgage repayments with your future home, current and future expenses, legal fees, lender fees, marketing costs and more. Filling in a spreadsheet can help you assess expected capital gains against transaction and relocation costs.
Market conditions are an important factor to consider when looking for ‘a good time to sell’. The value of your house may have increased dramatically since you bought it, but keep in mind you’ll likely be buying into the same market, particularly if upsizing or upgrading is your key motivator.
Seasonality in real estate is really worth considering. Does your house look at its best when the deck doors are open, the sun is streaming in and everything is dry? You could be led to believe that summer is the best time to sell. Well, yes and no. In New Zealand, most new property listings tend to pour into the market in February and March and again in October and November (close to 40% of all new listings in a year pour onto the market during these four months).
However, unless your house suffers from damp or too much shade, perhaps taking advantage of the winter months when there are fewer listings (but still plenty of buyers) could allow your home to get noticed and have less competition. So don’t rule out the cooler months of the year, especially if your home is elevated and sunny pretty much all year round.
Making the choice to be brave and different when selling your home could pay off. In winter new listings are at least 10% lower than normal but sales only decline around 4%, so it’s the best time for sellers to stand out in the market. Remember, the price of a property doesn’t depend on the season.
Your agent will walk you through the whole sales process from well before the ‘For Sale’ sign goes up, right through until after the Sold sticker is triumphantly placed on your sign. From the outset they can provide a good understanding of what your house may be worth and advise you of all costs associated with selling a property. Other roles of the agent include, preparing the marketing plan for your home, helping you with the sale price and method, showing your home to potential buyers, presenting offers, negotiating and ensuring sale conditions are met.
Selling your property most likely means that you’ll be moving into another one. A mortgage broker helps take the stress and confusion out of the financial side of the moving process, by finding you a lender. He or she will evaluate your financial situation, while offering constructive feedback and a translation service on any new terms you may be encountering. Be ready for the first meeting with your mortgage broker by mapping out your finances early.
Your banking consultant will tell you how much you’re eligible to borrow and will work with your mortgage broker to ensure the necessary finance is in place so you’re ready to to put an offer in when you find your next property. Depending on your income and ability to service your current mortgage and that of a new property, keeping your current home as a rental property may be an option. In this case, you would be using your current equity as security on a second property, whilst becoming a landlord at the same time. This is where a chat with your bank will really help.
Whether you are buying, selling or both, you will need a lawyer on your team. He or she will translate any contract legalise for you and will approve all legal documents before you do! When you’re ready to list your home, a key document your lawyer will need to check is the Listing Authority. This is a legally binding agreement which outlines information including the agent’s fees and commission, and the extent of the agent’s ability to act on your behalf and the terms of the agreement.
Selling your home is not as simple as getting the mallet out, knocking up a ‘For Sale’ sign, then resting on your laurels. Once you’ve established your financial position, and urgency (or lack of) to sell, this will form a basis for upcoming decisions on price, sale method and advertising.
Everyone wants the best price possible for their home, and some people get it. But the reality is, your home is only worth what someone else will pay for it. So work with your agent on a strategy for pricing your home that will see you sell it within a reasonable time-frame and at a price you’re happy (possibly even ecstatic) with — so you can get on with your life!
Auction, closed tender, negotiation, or asking price…? Your agent will help you determine the best method of selling your property based on its price bracket, region and market, and your urgency to sell.
Tender – sell it maybe, we’ll see.
Potential buyers submit their offers in writing along with any conditions. You choose which offer is most appealing and you can either accept or negotiate further.
Auction – sell it now!
Highest bidder wins as long as your reserve price has been met and it’s typically all over within a matter of minutes! The sale is unconditional. Auctions can drive up the price of your property if there are multiple bidders and are also a favoured option when there is urgency to sell. Ensuring there are a number of interested parties is the key to your success.
Negotiation – sell it soon!
Your home is advertised at a set price or price range. Potential buyers make offers in writing and then are able to negotiate with you on price and conditions.
With such tight competition, it’s important to make a great first impression on potential buyers. A good place to start is by putting yourself in their socks (well, hopefully they’ve left their shoes outside the door).
Make sure the front of your house (and access) is as presentable as possible. Add a greenery-filled planter box by the front door, water blast the concrete, wash the front of your house or give it a touch up coat of paint. A new letterbox is an inexpensive way to make your place look a million dollars from the street.
Mow lawns, remove any dead branches and prune trees/shrubs, maybe dedicate an area of existing garden to a veggie patch, by adding some easy-care herbs and other plants for an instant veggie garden. Consider a neutral coat of paint on dated feature walls, higher wattage lighting to give the illusion of light and change out (or remove) dark curtains.
Now is also the time to tackle unfinished repairs and projects. Tidy up any niggling bits and pieces like leaking taps, blown bulbs and chipped paint. Major repairs may not yield the return on investment you’re after, so factor that in before embarking on a DIY adventure. Get estimates on the cost of replacing important things like hot water heaters, roofing etc. so you know your figures if a buyer wants to play hardball with negotiations.
You want your home to have ‘personality’ — as long as its nature is benign, open and well mannered, rather than a melancholy hoarder. You’ll have to be ready to open your home for weeks, so it’s a good idea to keep things neutral, tidy and clean. Home staging can be costly, but consider how fresh and modern it makes your home look.
Unfortunately selling a home doesn’t always go to plan — the ‘For Sale’ sign might have been up for a while, or auction day may have been and gone but the auctioneer’s gavel never made that satisfying clunk. So rather than proceeding in blissful ignorance, it’s important to prepare yourself emotionally and logistically for the ‘what ifs’.
Maybe that conditional offer fell through — your highest bidder may have made you a conditional offer that is subject to them being able to sell their own home. This gives your buyer a certain period of time to sell their home. You can stipulate how much time your buyer has, before you start taking offers from other buyers.
Most agents will bend over backwards to make sure you’re happy with the process of selling. But if you’re not happy, what can you do? If you have a concern, your first port of call is to talk to your agent to try and resolve it. If it’s more serious, check out the complaints procedure at REA. Ultimately, your interests are protected, and your agent is legally bound to deliver a service with your best interests at heart.
If you’ve bought a new place without selling the old one you’re likely to need bridging finance — a short-term interest-only loan that allows you to buy a new property before you’ve sold your existing one. While bridging loan interest rates aren’t cheap, this type of loan can get you out of a sticky situation.
Your open home is the moment to make a memorable impression so that you get the best chance to sell your home fast for a good price.
Be wary of letting buyers in outside of open homes as this could reduce the pool of people you’ll get on open home day. Potential buyers may think that a shortage of people coming through the door is a reflection of the overall interest in your home and they could mistakenly think there’s something wrong with the property.
On the open home days, make sure your property is beautifully presented and if possible, the open home is held at a time when the sun is streaming into your living area. The chances are by the time an interested buyer walks through the door at your open home, they will have already driven by, possibly even scrutinised each room from all angles and checked out your home’s street appeal with Google street view. Ah, the digital age. A good agent will ensure that a potential buyers’ hunger for information is well and truly satiated by having all relevant details on hand when they come through the door.
Avoid letting buyers through before the first weekend of open homes. There are two issues with this trap. Firstly, the people you let in the door early, may not see your home at its ‘open home’ best, reducing your chances of negotiating a good price.
A buyer’s expectation of price and a seller’s expectation of price are very seldom the same. In fact, there is very often a large gap between the two! That’s why a good agent is worth their weight in gold. It’s their job to close this gap in your favour and get you the best possible price for your house.
To obtain a premium sale price, your agent will engage as many buyers as possible. Buyers will then tend to focus on out-pricing other interested parties, rather than trying to buy your house for as little as possible. A good agent will go beyond what an individual buyer is prepared to pay and negotiate towards what they are able to pay. They can greatly influence the final price you receive.
When choosing an agent to sell your property, always ask about their selling experience, their success rate marketing your type of property and what form of marketing method you should choose.
Getting a good agent who understands your market and who is successful will ensure you get the right buyers in the door and give you confidence that he/she will negotiate hard to get you the best price. The difference between a good agent and a mediocre one is potentially thousands of dollars on the sale price of your property.
