Home Seller's Guide - Getting Ready for Sale

Getting Ready for Sale

Now is the time to put your planning to work and your home on the market. Your main concerns at this stage are: what to expect at a listing appointment and how to be prepared for one, how to set an asking price, how to fix up your home to sell and how to show your home to its best advantage. You'll find what once looked like a great scramble is beginning to fall into place.

What is meant by a Listing Agreement?

When you put your home up for sale, it's called "listing" because your agent lists the property on the open market or in the Multiple Listing Service to expose your home to the widest range of buyers. To do this, you employ the agent to market your home by signing a contract. This listing agreement is signed at a listing appointment. The agreement contains the following items along with other disclosures (be sure to read the listing agreement thoroughly and have your agent explain anything that seems confusing):

• A complete description of your property.
• The price you're asking
• An indication of the financing terms you will accept.
• The brokerage fee.
• The length of time the agreement is to be in effect.

When you sign the listing contract, you may agree to give your agent the "exclusive right to sell" your home for a certain listing period, at the end of which you may extend or terminate the agreement, depending on your satisfaction with your agent's efforts to sell.

You may agree to allow your agent to put a "For Sale" sign on your lawn, to run ads in newspapers and magazines, to send out direct mail brochures and to make the property readily accessible so that other agents in the Multiple Listing Service can show your home if you're away.

Your agent should agree to actively market your home, list your property in the Multiple Listing Services if there is one in your area and to keep on top of all aspects of getting to settlement or closing, including appraisal, loan approval, termite inspection, etc.

What should I do to get ready for a Listing Appointment?

A listing appointment is most productive if you have the following information on hand. Because the list is long, we've divided it into essential items and optional items:

Essential Information

• Your property tax payments and/or condominium fees for the past year.
• Your loan account number and loan balance, your interest rate if possible, your P.I.T.I. (principal, interest, taxes, insurance) and the amount of assumable mortgage money available, if any. Your agent will help you notify your lender of your intention to pay off your loan, which lessens the amount of prepayment penalty and interest you may or may not be subject to, depending on your lender's terms.
• A list of personal property that will go with the home (convey) when you sell. If removing the item will create needed repairs, the time is considered real property that goes with the home unless otherwise indicated.
• A list of personal property that will not go with the home
• Legal property descriptions.
• Homeowner's association or condominium bylaws.
• A list of major unresolved defects which should eventually be disclosed to a buyer. If you have a major problem you don't intend to correct, be candid about it. Honest disclosure is always best.

Optional Information

• Your utility bills for the past year
• A list of all the energy-efficiency features (insulation, etc.), including improvements you've made (solar water heater, etc.), ideally with utility bills before and after improvements to illustrate the savings.
• A certificate, if available, showing your home is free of termites. Inspection can be ordered later.
• A list of property tax assessments and any existing easements.
• A certificate of current inspection of your septic tank and well, if you have either.
• Any documentation available of other home-related matters such as:
  • Warranties still in effect on electrical, heating/cooling systems, appliances, etc.
  • A property survey or house location plat.
  • A floor plan if you have one.
  • Title insurance policy.
  • A professional property appraisal if available.
• A list of special features that you think would help sell your home, such as extra storage, built-ins or a generator to insure against power outage, etc.
• A list of the features you personally like about your home and neighborhood.
• A map of the area, pinpointing the convenience of schools, transportation, shopping, recreation.
• Anything that you think would help get your home sold quickly, profitable and with the least inconvenience to you.

How do I figure what price to ask for my home?

You've probably already heard what similar homes in your neighborhood have sold for. But hearsay isn't enough. You need to weigh all the determining factors of the real estate market.

To arrive at a fair price, you need an expert evaluation of all market conditions; in other words, you need a professional market analysis. This is because market price no longer can be considered as an isolated element. Your home can be worth several different prices depending on terms you offer, available financing and the condition of your home. For example, a home with assumable low-interest-rate financing could be worth more to a buyer than an identical home that offers only new higher-market-rate financing. What concerns buyers most is not price, but monthly payments.

Your agent is glad to provide such an educated opinion. You'll learn what prices buyers will pay for what kinds of homes in the current market, and you will be able to price your home accordingly.

What Determines Market Value?

Many sellers don't understand the value that comes from outside the home. The bricks and mortar are not what make value; rather, value is in the eye of the buyer. In most cases, the actual cost of the home is not the key to value. Today's key to value also goes beyond the old real estate maxim: Location, location, location.

Market value is also tied to several trends, chiefly:

• Economic conditions which reflect both national and community business conditions.
• National, state and/or local political activity that produces changes in tax laws and tax rates, sales regulations, zoning restrictions, reassessments of property, etc.
• Pressures of supply and demand, which create either a buyer's market when there are more sellers than buyers and home prices may drop, or a seller's market when there are more buyers than sellers, causing home prices to go up.
• Seasonal influences create a buying season and an off-season, although this traditional trend has given way more and more to year-round selling.

What are some insider secrets to make my home more marketable than other neighborhood homes?

Our experience shows the following tips will help your home sell quickly and at the best possible price:

• Select a price carefully. Remember, your price has to please three people: you, the buyer and the appraiser. The closer your price is to actual market value - what a knowledgeable seller will accept and a knowledgeable buyer will pay - the sooner it will sell.
• Be sure your price is realistic. Unrealistic prices are the major cause of "shopworn" listings, those that cause people to wonder if something is wrong with the home and result in eventual below-market sales. Overpricing actually helps sell other competing homes by making those listings look like better values compared to yours. If you plan to reduce the price anyway, why wait?
• Show flexibility in evaluating the need for special financing, perhaps through owner financing or VA/FHA.
• Try to offer immediate possession, although move-up buyers may need more time.
• Exposure sells homes. Provide easy access to property for showings.
• Offer extras that convey: free-standing appliances, pool table, swimming pool chemicals, washer/dryer, etc. You may keep some extras out of the listing and save them as sweeteners for negotiations.
• Allow yard sign, if permitted in your neighborhood.
• Fix up your home and keep it in top condition inside and out.
• Listen to and follow any special advice from your agent.

  What basic repairs and improvements should I make to increase the marketability of my home?

  Basically, freshness, neatness and good working order are the chief keys to top sales appeal. Why tell prospective buyers how your home could look when you can show them? Lok at your home as if you were seeing it for the first time and be as critical as a buyer. Open up space, closets and storage as much as possible because openness creates a positive impression with buyers. Repair what strikes you as the least bit shoddy. Your ideal goal is to show the property in move-in condition - without a thing to fix. From experience we know that property in poor condition incites low offers.

  Showmanship Outdoors

  • Generally, improve your home's curb appeal, or how your home looks to a buyer from a car parked at the curb.
  • Make your front door and porch attractive. You only get one change to make a positive first impression.
  • Trim the lawn and shrubs, fertilize and water if needed.
  • Fix cracks and bulges in walks and driveways; also remove oil stains.
  • Replace stray or warped roofing shingles.
  • Paint siding, windows, shutters, doors, even mailbox.
  • Straighten sagging gutters
  • Replace a worn doorbell bottom. Polish any door brass. Replace a worn doormat. These things say you care about your home, and the doormat will protect floors and carpets.

  Showmanship Indoors

  • Clean the kitchen especially, including oven, exhaust hood and inside of dishwasher. Unclutter counters and cabinets. Some buyers will judge the maintenance of the entire home by the cleanliness of the kitchen.
  • Few things increase marketability and give you a better cost return than new paint. Freshen any worn or soiled walls and woodwork with neutral-toned paint or wood polish.
  • Polish wood floors and stairs.
  • Steam clean or replace worn carpeting.
  • Repair dripping faucets, crooked drawers, sticking doors. Tighten the hardware, especially doorknobs. Minor flaws in your home suggest neglect to prospects.
  • Repair or replace worn appliances.
  • Clean windows and storms inside and out.
  • Scrub counters, bathroom fixtures and tiles.
  • Clean exterior of water heater and furnace/air conditioner where prospects will be inspecting. Also drain a bucket of water from water heater to remove any rust particles.
  • The ideal garage holds only cars. If yours has become a two-car attic, throw out the excess or look into a temporary storage unit.

  What's the most effective way to show my home to prospective buyers?

  After you've completed all necessary repairs, go over your home with a fine-toothed comb before the first prospect arrives. Everything should be sparkling clean inside and out, and in good working order. Clean out the closets and storage spaces. Be ruthless. Put things in their places. Get rid of the trash. Let in as much sunlight as possible. Make each room look as roomy as it can. Clear out the garage. Throw out ancient magazines. Clean draperies. Wash windows, woodwork and counter tops. In general, tidy up, open up and unclutter.

  When an agent calls you to make an appointment, allow time to air the rooms, perhaps use air freshener or run a lemon though the disposal; also, baking cookies, bread or simply a pan of cinnamon adds a homey aroma; turn on lights; turn off stereos, TVs and radios; keep children out of the way; park the pets outside - many prospects are afraid of or allergic to animals, and you don't want to give a potential buyer a reason not to thoroughly consider your home. In short, get the whole place ready for close inspection.

  Greet prospects politely and excuse yourself. Leave the selling to the agent. Agents know what your home has to offer and what these particular buyers are looking for. Agents also know how to sell. Don't try to interrupt with suggestions, such as what personal property you might sell, what kind of financing you think would be good for the buyer, etc. Don't apologize for imperfections, but answer all questions put to you briefly and honestly. Do not discuss price or financing with a prospective buyer; refer them to your agent.

  Ready, Set, Sell!

  Now you're getting the picture. Everything's in place and your home is looking its best. Your home is available for inspection, and potential buyers are trooping through, peering into corners and closets. An eternity seems to pass as agents show your immaculate home to interested buyers. What's next?