The Orioles are playing baseball, the cherry blossom trees are in bloom, the flowers in Patterson Park are popping up, so we know spring is officially here. In real estate, this means it’s the busiest time of year, when a large number of home owners start to get their house ready for the market, or have already placed their home for sale. If you are considering selling your home, have you considered all the factors involved?
The first item to look at, is equity. Simply put, how much do you owe on your house versus how much your home will sell for. You can take a look at your most recent balance on your mortgage statement to determine what you still owe on your property. Once you know that information, you can contact a real estate agent to give you his assessment of your property’s value. Don’t just look at the big number, because there are a few factors that will take away from your bottom line, when settlement day comes.
First, as a seller, you will most likely pay half of the state and local transfer taxes and recording fees (1.5% of the sales price). Second, you will owe the real estate brokers for assisting you with your home sale, this fee will vary based on the brokerage and what they provide you.
There will be some other fees that vary based on the individual sale as well: paying 3 years of ground rent + $500 in escrow if the ground rent holder is unknown, paying for any repairs that you agree to after the home inspection, and any seller concessions that were agreed upon when you signed the contract of sale. If all these factors look positive to you, then you have a clear picture of the financial side of the sale. Now it’s time to take a look at the other factors involved.
Different sales prices command different buyer expectations. Generally speaking, the more money you are looking to obtain from your sale, the higher the expectations are from the potential buyers. This may mean neutralizing your paint colors, staging the home, making repairs, updating bathrooms or the kitchen, and maybe changing the carpet/ sanding the floors.
However, if you are offering the home for a great value or it’s a home below the median sales price, the prospective buyers may overlook some flaws. Not all changes have the same return on investment. Again, I’d recommend speaking with a real estate professional or stager for guidance.
The next factor is determining if you are ready to handle buyers walking through your home. In my experience, homes that are harder to show are harder to sell. The most common reasons for not having frequent showings are young children, pets, and tenant occupied properties. For those with young children with bedtimes, buyers can be discouraged by multiple attempts to view the property after work, only to be turned away. These buyers may eventually give up trying to see your home, and you lose out on a potential sale. If a pet remains at the property and showings are only allowed in the evenings when you are home to remove the pet, you might miss out on a buyer who prefers to view properties in the morning or afternoon.
Tenants are often times difficult to deal with because they have no incentive to help you sell the house they are living in. This means that these properties are often hard to show and if you are able to be showed, are usually fairly cluttered and dirty.
After you have gotten over these factors, it’s time for a few emotional and mental elements to be prepared for. When buyers come to the property, most agents will attempt to get feedback after the showing. Can you handle someone being critical of your home? I tell my sellers to try not to take it personally, but it can be hard to hear that someone doesn’t love your home as much as you do. It is necessary factor that helps you realize why that buyer didn’t make an offer on your home.
You’ve raised your children in the house, had great crab feasts on your deck, are friendly with all your neighbors, are you really ready to leave the house? There are certain sellers that haven’t taken this into consideration, and when that perfect offer comes in, they end up not accepting it, because they haven’t mentally prepared to move out of a house that has so many memories.
If you have considered all the factors involved and you’re truly ready to move on, the spring offers a great opportunity to sell your house.
Mario Valone is a real estate agent with Coldwell Banker Inner Harbor. He can be reached at firstname.lastname@example.org or 410-327-2200, and is happy to answer questions.