Selling Your Home Successfully   Send Gretchen a Note and she’ll provide you with a Free Comparative Market Analysis and Help You Get Your Home Sold! Step 1:         Plan/Prepare  Some 5 million existing homes are sold each year, and while each transaction is different every owner wants the same thing - the best possible deal with the least amount of hassle and aggravation.  Unfortunately, home selling has become a more complex business than it used to be. New seller disclosure statements, longer and more mysterious form agreements, and a range of environmental concerns have all emerged in the past decade.  More importantly, the home-selling process has changed. Buyer brokerage - where REALTORS® represent homebuyers - is now common nationwide, and good buyer-brokers want the best for their clients.  The result is that while almost 100,000 existing homes are sold each week, the process is not as easy for sellers as it was five or 10 years ago. Surviving in today's real estate world requires experience and training in such fields as real estate marketing, financing, negotiation and closing - the very expertise available from local REALTORS®. Are you ready?  The home-selling process typically starts several months before a property is made available for sale. It's necessary to look at a home through the eyes of a prospective buyer and determine what needs to be cleaned, painted, repaired and tossed out.   Ask yourself: If you were buying this home what would you want to see? The goal is to show a home which looks good, maximizes space and attracts as many buyers - and as much demand - as possible. While part of the "getting ready" phase relates to repairs, painting and other home improvements, this is also a good time to ask why you really want to sell.  Selling a home is an important matter and there should be a good reason to sell - perhaps a job change to a new community or the need for more space. Your reason for selling can impact the negotiating process so it's important to discuss your needs and wants in private with the REALTOR® who lists your home. When should you sell?   The marketplace tends to be more active in the summer because parents want to enroll children in classes at the beginning of the school year (usually August). The summer is also typically when most homes are likely to be available. Generally speaking, markets tend to have some balance between buyers and sellers year-round. In a given community, for example, there may be fewer buyers in late December, but there are also likely to be fewer homes available for purchase. So, home prices tend to rise or fall because of general demand patterns rather than the time of the year. Owners are encouraged to sell when the property is ready for sale, there is a need or desire to sell, and the services of a local REALTOR® have been retained. How do you improve your home's value?  The general rule in real estate is that buyers seek the least expensive home in the best neighborhood they can afford. In terms of improvements, this means you want a home that fits in the neighborhood but is not over-improved. For example, if most homes in your neighborhood have three bedrooms, two baths and 2,500 sq. ft. of finished space, a property with five bedrooms, more baths and far more space would likely be priced much higher and likely be more difficult to sell. Improvements should be made so that the property shows well, is consistent with the neighborhood and does not involve capital investments, the cost of which cannot be recovered from the sale. Furthermore, improvements should reflect community preferences.   Cosmetic improvements - paint, wallpaper and landscaping - help a home "show" better and often are good investments. Mechanical repairs - to ensure that all systems and appliances are in good working condition - are required to get a top price.   Ideally, you want to be sure that your property is competitive with other homes available in the community. REALTORS®, who see numerous homes, can provide suggestions that are consistent with your marketplace. Step 2:         Get a Realtor®.   All real estate licensees are not the same. Only real estate licensees who are members of the NATIONAL ASSOCIATION OF REALTORS® are properly called REALTORS®. They proudly display the REALTOR "®" logo on the business card or other marketing and sales literature. REALTORS® are committed to treat all parties to a transaction honestly. REALTORS® subscribe to a strict code of ethics and are expected to maintain a higher level of knowledge of the process of buying and selling real estate.   Once your home is listed with a REALTOR®, he or she will immediately begin to market your home according to the most appropriate conventions for your community.  Your REALTOR® should keep you informed as the marketing process unfolds and as expressions of interest are received. In time, the marketing plan may be modified to reflect buyer reactions and changes in the marketplace. Step 3:         Set the Price.   Every reasonable owner wants the best possible price and terms for his or her home.  Several factors, including market conditions and interest rates, will determine how much you can get for your home.  The idea is to get the maximum price and the best terms during the window of time when your home is being marketed.   In other words, home selling is part science, part marketing, part negotiation and part art.  Unlike math where 2 + 2 always equals 4, in real estate there is no certain conclusion.  All transactions are different, and because of this, you should do as much as possible to prepare your home for sale and engage the REALTOR® you feel is best able to sell your home. What is your home worth?  All homes have a price, and sometimes more than one. There's the price owners would like to get, the value buyers would like to offer and a point of agreement which can result in a sale.   In considering home values, several factors are important: The value of your home relates to local sale prices.  The same home, located elsewhere, would likely have a different value. Sale prices are a product of supply and demand. If you live in a community with an expanding job base, a growing population and a limited housing supply, it's likely that prices will rise.  Alternatively, it's important to be realistic.  If the local community is losing jobs and people are moving out, then you'll likely have a buyer's market.  Owner needs can impact sale values. If owner ‘A’ "must" sell quickly, he will have less leverage in the marketplace. Buyers may think that ‘A’ is willing to trade a quick closing for a lower price -- and they may be right. If A has no incentive to sell quickly, he may have more marketplace strength. Sale prices are not based on what owners "need." When an owner says, "I must sell for $300,000 because I need $100,000 in cash to buy my next home," buyers will quickly ask if $300,000 is a reasonable price for the property. If similar homes in the same community are selling for $250,000, the seller will not be successful. Sale prices are NOT the whole deal. Which would you rather have: A sale price of $200,000, or a sale price of $205,000 but where you agree to make a "seller contribution" of $5,000 to offset the buyer's closing costs, pay a $2,000 allowance for roof repairs, fund two mortgage points, re-paint the entire house and leave the washer and dryer? How much is too much?  Because all transactions are unique there is flexibility in the marketplace. The amount of flexibility depends on local conditions.   For example, suppose you're selling a townhouse.  Suppose also that there have been five recent sales of the model you own and that sale values have ranged between $200,000 and $210,000.  You now have an idea of how your home might be priced. In a strong market perhaps you can ask for $210,000 or a little more.  If the market has slowed, $210,000 may be a reasonable asking price, but perhaps more than the final sale price.  REALTORS® are familiar with the terms and conditions that went into individual sales, not just published sale prices which may not reflect various premiums, discounts and adjustments.  Step 4:         Market It.  Selling can entail a variety of marketing strategies. Once listed, it's likely that the home will be quickly entered into the local MLS (Multiple Listing Service) and placed on REALTOR.com®. REALTORS® routinely market by mail with new-listing announcements and regular newsletters.  Open houses, broker access to the home via the use of a lock box and networking with both local and out-of-town brokers are also common.  Much of a broker's work will be quiet and unseen -- yet important. The quiet telephone calls, the work with contacts, the follow-ups with open-house visitors, conversations with ad respondents, the web postings and other outreach efforts are all part of the process required to sell homes. Experienced REALTORS® base their marketing efforts on previous transactions and ongoing research. For instance, according to the National Association of Realtors (NAR), 37 percent of all buyers check the Internet. NAR numbers also show that most households move within 10 miles of their current location while 20 percent move at least 50 miles. Step 5:         Sell It.    No less important, a home sale by itself can be complex.   There will be people looking at your house, documents to sign and issues to be negotiated.   Because a home sale involves an array of both personal and business concerns, it's important to get it done right.  You need to carefully prepare your home, understand the market and see what alternatives are realistically available.  The old motto "be prepared" is a good guide in such circumstances.   There is no question that selling a home is an important event.  A home sale represents transition, movement and change. Big money is involved.  Households move from the known and comfortable to the unknown and a period of adjustment. What's an acceptable offer?  A number of factors determine whether a buyer's offer is acceptable. They include: Is the offer at or near the asking price?  Is the offer above the asking price? Has the buyer accepted the asking price or something close?  Has the buyer then buried thousands of dollars in discounts and seller costs within tiny clauses and contract additions? What is the alternative to the buyer's offer?  If a home has not attracted an offer in months, then sellers need to determine if a better deal is possible -- recognizing that each month costs are being incurred for mortgage payments, taxes and insurance. Does the owner have enough time to wait for other offers? What if no other offers are received? What if several offers are received?  Do you choose the high offer from the purchaser with questionable finances who may not be able to close, or a somewhat lesser offer from a buyer with pre-approved financing? In each case, owners -- with assistance from  aREALTOR® -- will need to carefully review offers, consider marketplace options and then determine whether an offer is acceptable. What is a counter-offer?   When a home is made available for sale the owner is essentially making an offer to buyers:  For a given number of dollars and other terms you can acquire this home. Buyers, in turn, can respond with several options: Not interested. Yes, we'll buy on the owner's terms. We're interested and here's our counter-offer. The REALTOR® who lists your home can explain the local bargaining process in detail and assist in the actual negotiations. How do you negotiate?  Real estate bargaining typically involves compromises by both sides. It's not war; it's not winner-take-all; and it's not the time to take personally any comments made by purchasers.   Instead, negotiating should be seen as a natural business process; buyers should be treated with respect; and owners should never lose sight of either their best interests or their baseline transaction requirements. These are the standards unique to each owner, which must be met before the home can be sold.  A "win/win" situation is possible where each side gets something of value.     Step 6:        Close.  Closing -- or "settlement" or "escrow" as it is known in some areas -- is essentially a meeting where the closing agent (the party who conducts settlement) takes in money from the buyers, pays out money to the owner and makes sure that the purchaser's title is properly recorded in local records along with any mortgage liens.   The closing agent reviews the sale agreement to determine what payments and credits the owner should receive and what amounts are due from the buyer. The closing agent also assures that certain transaction costs are paid (taxes and title searches).   The result of these considerations is that most homes close 30 to 45 days after a sale agreement has been signed. Closing is also the time when "adjustments" will be made. For instance, suppose you've pre-paid taxes four months in advance.  In this case, the closing agent will compensate you for the prepayment at closing by having the buyer pay you additional money.   It could also work in reverse.  If you are behind on property taxes, the closing agent will reduce the money due to you at settlement by the amount of the unpaid taxes. Step 7:         Moving.  The time to plan your move begins once you've decided to sell your home. Some of the activities required to sell the home can actually help with the moving process.  For example, cleaning out closets, basements and attics means there will be less to do once the home is under contract.  It's ideally best to get rid of excess furniture and other goods by having a sale before you move. This will reduce the volume of goods to be moved and thus lower moving costs.  You should provide the U.S. Postal Service with a forwarding address, and utility companies should be advised when to end service. Check with utility companies to see if there is deposit money which should be returned. Get mover estimates in writing. Be aware that it's possible to get discounts through membership organizations and, sometimes, on the basis of your profession: Clergy, for example, sometimes qualify for a discount.  Always confirm mover credentials. Movers should be licensed and bonded as required in your state, and employees should have workman's comp insurance.   Get a checklist.  Moving is a big job and checklists can make it more organized and easier. Here are some of the major items to consider: Money. If you're moving more than a few miles then you should have enough cash or credit to cover travel, food, transportation and lodging. Medicine. Keep medicines and related prescriptions in a place where they will be available during the move. Number boxes so that all items can be counted on arrival. Make a list of boxes by number and indicate their contents. If moving with children, make sure that each has a favorite toy or toys, blankets, games, music and other goods. Moving historic, breakable or valued items? Such goods routinely require special handling and packaging. Have address books readily available in case you need help. If you have a laptop computer with a modem, make it accessible during your trip to pick up business and personal e-mail.