Selling Your House? Don't Overlook These 5 Things Before You List

Real Estate Nate

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For many people, a home purchase is the largest purchase they’ll ever make, so selling a home can be one of the best ways to get a large lump sum of cash. The process of selling a home is incredibly stressful, though, and it demands a lot of time and energy.

While it’s wise to have a real estate professional assisting you through the process, it’s also a good idea to know a bit about the process yourself. Whether you choose the for-sale-by-owner route, have a real estate agent or are working with a referral agent, it’s ultimately your home and your money. The more information you have, the better chance you have at getting the greatest possible return on your investment.

If you’re thinking about selling your home, check out the following factors some people overlook.

1. The local market and market predictions for the next few months

When selling your home, it’s absolutely essential you consider market conditions in your area. Is it a buyer’s market or a seller’s market? Are home values going up or down? Local real estate experts can be a fantastic resource for this type of information. Zillow’s Home Value Index is an excellent tool to determine the state of the market in your area. It reflects the general value of homes in the 35th-to-65th percentile to give you an idea of what most houses are typically selling for. Other sites, such as Realtor and NeighborWho, also provide information on median home values in a specific city or region.

In addition to using home value indexes and median sales prices, it’s also a good idea to try and find local market predictions for the coming months. Is there anything unique happening in your area that could have a negative or positive impact on home values? For instance, is there a new highway being built soon, a new company building a site in your area or any other infrastructure plans that could impact the job or housing market?

It’s also wise to ask yourself which month is the best month for home sales in your area. Zillow reports that on a nationwide scale, the best time to sell a home quickly is during the month of March, while the best time to sell a home for maximum profit is during the month of July. This may vary slightly depending on where you live, so find out when it’s best to list homes in your local area.

2. The possibility of a national boom or recession

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Your local housing market is essential to your success or failure when selling a home, but the state of the national economy can also have an impact. During the 2008 recession, home prices fell by one-third on average across the country. This means someone who owned a $500,000 house would likely end up with a home worth around $367,000. You’re much less likely to get peak pricing for your home during an economic recession.

As of May 2022, Statista reports the projected probability of recession in the United States at 6.11%.

3. Neighborhood expectations and any factors that make your home different

When buyers search for homes in a specific neighborhood, they typically expect those homes to be up to par with the rest of the surrounding homes. If the other homes in the neighborhood have security systems, your home should have one. If the other homes have updated kitchens, you should update your kitchen as well.

On the other hand, if most of the homes in the neighborhood have a garage but you decided to finish your garage and turn it into more living space, this might make it more difficult to sell your home. Although your home may offer more square footage than others in the neighborhood, it also lacks a feature buyers expect to see when looking in your area. It’s wise to keep in mind anything that makes your home different from the other homes surrounding you and to factor this into your pricing.

There’s also such a thing as overbuilding, which happens when a homeowner upgrades their home so much that it’s priced out of the neighborhood. You don’t want to add so many amenities and luxury finishes that your home is worth significantly more than other homes in the neighborhood. Instead of buying an overbuilt home in an affordable neighborhood, many buyers would rather just move to a more expensive neighborhood.

4. Any necessary repairs, whether your home will pass inspection and buyer loan implications

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According to a survey by Porch, roughly nine out of 10 homebuyers use an inspector when buying a property. Many lenders require an inspection, so it’s often part of the escrow process. In nearly half of the instances where the inspector found an issue, the buyer or agent was able to negotiate a lower purchase price on the home. Having your home in tip-top shape can save you money and get you a bigger payday when it comes time to sell your home.

HGTV reports some of the more common issues people encounter on inspection reports are electrical issues, roofing problems, HVAC issues, plumbing problems, water damage near doors and windows, poor drainage surrounding the home exterior, poor insulation or ventilation, mold or environmental issues or structural damage. If you think you might have any of these issues, it might be best to fix them before listing your home. You can even get a pre-sale home inspection to prevent surprises later on.

5. Fees you’re responsible for as the seller

When buying a home, you’re usually only responsible for a down payment, closing costs, setting up utilities and a few reserve costs. However, the seller is usually responsible for closing costs, commissions to real estate agents, home repairs, driveway repair, professional cleaning costs and staging and landscaping costs as well as any photography (if that’s not included in your real estate agent’s fees).

These costs can add up fast, so it’s a good idea to calculate everything you’re spending to sell the house. Once you add these costs to the amount of money you owe on your loan, you have your all-in costs. Subtract these all-in costs from the selling price of your home to determine how much money you’ll get in your pocket.

One last cost you may or may not incur is any debts you owe. If you have any judgments or liens against you, this may be subtracted from your home sale proceeds before you get a check. Use NeighborWho to check for any potential flags that may be tied to you or the property and could impact the sale.

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Nate Johnson is a Real Estate Investment Expert at NeighborWho, a leading property search site whose mission is to help people find in-depth information about properties and property owners in order to find new investment opportunities.

Salt Lake City, UT
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