Home Selling Information
What to look for when appointing a Real Estate Agent and selling your home.
A: †† † Appoint An Agent
When looking to sell your home the first thing you will need to do is appoint an agent. Here are some tips to help you find the agent thatís right for you:
- Understand the benefits an agent should offer,
- Build a list of possible agents,
- Ask the right questions, and
- Enlist an agentís services.
1. Understand the benefits an agent should offer
Your home is likely to be your most valuable asset, so professional expertise and assistance with the sale is worthwhile. For this reason, most home sellers engage a real-estate agent.
Working with an agent should offer you the following advantages:
- Access to market appraisal data,
- Advice on the most appropriate method of sale (e.g. auction or private treaty),
- The development and implementation of a marketing plan,
- Advice on how to present your home to the public,
- Access to a large numbers of buyers,
- Screening of potential buyers,
- Assistance when negotiating the best price, and
- Effective administration of all legal and financial requirements.
2. Build a list of possible agents
You should meet with several real estate agents before electing your representative/s.
To find out which agents operate in your area, use our find an agent feature. Also check through local newspapers for agents actively promoting houses within your area, ask neighbours to refer you to local agents and watch out for Sale signs and make a note of the listing agent/s.
Donít be alarmed if agents suggest meeting at your house. This will give them the opportunity to conduct an appraisal. This service should be provided for free and in no way obligates you to engage the agent.
3. Ask the right questions
Meeting with agents is similar to conducting job interviews. The agent wants to work for you, and you want to select the best candidate for the job. Therefore, prepare a list of questions to ask of all the agents you meet.
Questions to ask prospective agents include:
- For how long have you been a real-estate agent?
- How familiar are you with the suburb in which our home is located?
- How many homes have you sold in our suburb over the past 12 months?
- How did you arrive at the price you suggest we could sell our house for? (Refer to setting a price)
- What marketing plan would you envisage using for our house?
- Will you provide weekly sales progress reports?
- Do you place importance on high ethical standards?
Other items you may like to review include the quality of the promotional material and the presentation of the salesperson. You could also ask for the contact details of recent clients, and then refer to these people for further insight into the agentís operations.
Also take the time to ask your family, friends and associates for referrals. Tales of first hand experiences with particular agents can prove extremely valuable when deciding which agent to appoint.
4. Enlist an agentís services
Once you have decided on the agent you wish to have represent you, a written agreement should be drawn up. This will contain an estimate of the total fees, charges and expenses you can expect to pay when your home is sold.
Read this agreement carefully and if you are unsure of any aspects, seek legal advice before signing the document.
B: †† † Should you Auction your Property?
The next thing to decide is whether you wish to sell your property at:
- Auction, or through
- Private Treaty.
Submitting your property for Auction means that prospective buyers will bid against one another at a date and time set by you. Auctions are generally performed on the site of the property that is for sale.
The main advantage of Auctions is that a firm price does not need to be set. This open-ended situation provides an opportunity of the price to exceed expectations. Auctions are likely to be more effective if the property is superior in quality to other properties in the area or if the property market is buoyant (i.e. experiencing a 'boom' time).
If you are considering an auction sale, you should appoint an agent. The agent will either carry out the auction personally or obtain an auctioneer to conduct the proceedings.
The agent will also be responsible for ensuring the marketing and promotion of the property has been conducted efficiently and all inspections performed prior to the auction. These acts should help to ensure several genuine bidders attend the auction.
Prior to auction you need to establish your reserve price Ė the minimum you will accept for the property. Click here for advice on how to do this.
You are not obliged to disclose your reserve price to anybody. However, be aware of the price range your agent is quoting to prospective purchasers.
2. Private Treaty
Private Treaty is the term used when you set the price at which your house will be marketed to the public.
Many purchasers like the fact that this price is defined, and would therefore prefer to buy through private treaty. This then, is the main advantage to a private sale. The seller of the property must commit to a price when the property goes onto the market, therefore it is critical that you set the price correctly.
As discussed in Appoint an Agent, your agent will develop a marketing plan for promoting your house. This plan should be agreed to by you and will set out the strategies your agent will employ to sell your property, e.g. signs, newspaper advertisements, Internet listing. Your agent will also be able to provide advice on preparing the house.
C: †† † Name your Price
If you are selling your home by private treaty, the most important decision you will need to make is what price to put it to the market. Even if you are to sell through Auction, you will need to establish your reserve price.
Setting a realistic price will ensure you obtain your asking price (or close to it) and also conduct the sale promptly. When determining a sound price you should:
- Arrange an Appraisal,
- Examine a Comparative Market Analysis,
- Consider Market Conditions, and
- Estimate your Net Gain.
1. Arrange an Appraisal
An appraisal is performed when a real estate agent inspects a property for sale to estimate its value. Many real estate agents will conduct free appraisals in the hope that you will choose to let them act as your exclusive agent.
You will be tempted to select the agent that recommends the highest price for your property. Beware of agents who put high prices on houses simply to gain your business, because advertising your house at a price way over the market value of the property can be detrimental to its sale in the long term.
Prior to appraisal, the majority of sellers will have a price expectation that is 5 Ė 10 % above the realistic market level. Keep this in mind when assessing whether an agent is over-pricing your property.
2. Examine a Comparative Market Analysis
Determining what the public has been willing to pay over recent months for properties similar to yours (i.e. similar condition, style and locality) is another important factor to consider when setting your price.
Your real estate agent should have access to this information, often referred to as a Comparative Market Analysis (CMA). Comprehensive CMAís will also include data on nearby houses that failed to sell, along with the prices they were listed at. Ask your agent to review a CMA with you to support the market price he/she recommends.
3. Consider Market Conditions
A Comparative Market Analysis will often include data on the number of days each comparable house was on the market prior to being sold.
When the real estate market is booming and property prices are on the increase, houses can sell in only a few days. Alternatively, if the market is slow, the average time for houses to be on the market can be several months.
Your real-estate agent will be able to tell you whether the area in which your property is located is experiencing a Buyer's Market (i.e. slow period) or a Seller's Market (i.e. boom).
In a buyerís market you may need to price conservatively in order to sell. In a sellerís market, on the other hand, you are more likely to fetch a price which exceeds expectations and can therefore set your price accordingly.
4. Estimate Your Net Gain
When you are satisfied that you can reasonably estimate the market value of your property, you can next assess the net gain you are likely to receive if you sell.
To do this you will need to determine the fees and costs associated with the sale of your home. These expenses should then be subtracted from your estimated sales price. Some of the items that should be considered include:
- The Agentís commission,
- Marketing/Advertising fees,
- Solicitorís Fees/Conveyancing costs,
- Improvement expenses, and possibly the
- Amount you will need to payoff your present loan(s).
D: †† † Get the House Ready
Before the house goes on the market it can be worthwhile investing some time sprucing it up!
When preparing your house for sale, consider:
- How much you should spend,
- Exterior appeal,
- Interior appeal, and
- Show Time!
1. How much should you spend?
When preparing your home for the market the general rule is to spend as little money as possible. Feel free to make relatively inexpensive upgrades to your home, e.g. replacing chipped door knobs, but avoid undertaking major renovations, e.g. remodeling the kitchen.
It is a good idea to consult your agent over any changes you plan to make. Your agent can then advise you as to whether your proposed changes will add value to your property. It is pointless constructing a new fence if it will not increase the price you are likely to sell the property at.
2. Exterior Appeal
Work at enhancing your homeís exterior appeal before attending to its interior. This should be your first priority as the exterior of your property provides a buyerís introduction to your home. If the exterior repels a buyer, they are unlikely to investigate the inside of the house. First impressions count!
Imagine you are a potential buyer. Stand across the street from your property and study it. If you drove past this house and saw a "For Sale" sign, would you be attracted to the external features of the house and want to see more?
Look over the following list of areas that may need attention when preparing the exterior of your property:
- Lawn - Keep your lawns cut, with neat edges. Reseed any bare patches and perhaps fertilise for additional colour.
- Shrubs/Trees - Trim branches where necessary, especially around windows to allow natural light into the house. Remove any dead limbs.
- Garden Beds - If appropriate, plant colourful flowers. Also add mulch to beds and remove all weeds. Perhaps place showy annuals in pots near the house entrance.
- Paths - Keep all paths swept.
- Windows - Repair any broken windows and wash all glass.
- Eaves - Wash and remove spider webs.
- Drains/Spouts - Unblock and clean.
- Paintwork - Attend to any flaking paint after discussion with your agent.
- Doors - Wash down your front door and its surrounds, polish brass fitting and repair any torn fly wire.
- Fences - Straighten, repair or repaint only after discussion with your agent.
- Junk/Rubbish - Remove all junk and rubbish, e.g. car parts.
- Pools/Ponds - Make sure these are clean.
- Garage - Keep your garage door closed.
3. Interior Appeal
Having prepared the exterior of your home, turn your attentions to the interior. Look over the following list of areas that deserve attention when preparing the interior of your property:
- Clean/Remove clutter - Clean every room in your house thoroughly and remove any clutter. This has the effect of making your home appear bigger. You might even consider renting storage space whilst your house is on the market or even have a garage sale.
- Carpet - Have your carpets steam cleaned.
- Painting - Painting chipped or dirty walls is said to give you the best return for money spent. Neutral colours are best.
- Damage - Repair any damaged plaster, tiles, wallpaper, windowpanes, etc.
- Plumbing, heating and cooling systems - Inspect and repair. Fix any dripping taps.
- Floorboards - Attend to any creaky or loose floorboards.
- Doors/Windows - Make sure these open and close effortlessly.
- Knobs/Handles - Fix if loose, damaged or missing.
- Benchtops - Keep these clean and clear.
- Plants - Consider buying some indoor plants.
- Other - Secure jewellery, cash and other valuables as well as any prescription medication.
4. Show Time!
Itís now time for prospective buyers to visit your house. The exterior and interior preparation is complete and your home is looking terrific. Here are some extra tips to help you prepare your home for viewing:
- Fill the house with light. Open all curtains and blinds and switch on lights.
- Make the house smell beautiful. Fresh air is good in summer or spring. Alternatively, you might simmer vanilla essence on the stove, brew coffee, use an oil burner, potpourri or bake biscuits.
- Clean and clear all the benches and tables.
- Put out fresh towels, tea towels, table cloths, etc.
- Restrain any pets.
- Switch off the television and radio, although soft, soothing music may be suitable.
- Make sure the house is at a comfortable temperature.
- Put some flowers in a vase.
- Give your agent the key to the front door. Potential buyers are important visitors and should not have to enter via the back door.
- Make yourself scarce!
Many people leave the house prior to the appointed inspection time. If you canít leave, perhaps wait outside during the viewing. Do not offer advice or try to help the agent in selling the property. Remember that you have employed your agent to do the selling and he/she will have far more experience than you when it comes to dealing with buyers.
With Open House sessions your house is advertised to be on display at a scheduled time and people do not need to make an appointment to view the house. These sessions are likely to attract more people, including Ďsticky-beakí neighbours!
When preparing for an Open House you may need to pay a little more attention to detail. Unlike a viewing at short-notice, people expect an Open House to be presented perfectly, almost to look as if it is unoccupied. Extra touches could include setting the dining room table with your good china, and lighting a fire in the fireplace.
E: ††† Make that Sale!
Once buyers start viewing your property you are on the way to making a sale. The next steps are:
- Negotiating and Accepting an Offer,
- Signing a Contract,
- Settlement, and
1. Negotiating and Accepting an Offer
It is the role of your real estate agent to conduct all negotiations. Do not negotiate directly with any prospective buyers, always redirect them to your agent if they contact you.
When an offer is made, the agent will put the offer in writing, signed by the buyer. The agent will then present this offer to you. If you are not pleased by the offer you make a "counter-offer" at a price acceptable to you. Your agent will then take this "counter-offer" to the buyer who will either withdraw their offer or match your asking price.
If you do receive low offers, make sure you do not take become distressed by this or take it personally. Often the buyer is simply trying their luck at eliciting a low price. Do try however to find out why the buyer is offering a low price. Perhaps he believes the fencing will need to be repaired at significant cost. Such information may help you to determine a counter-offer.
If you do wish to accept the offer, do this as soon as possible. At any time prior to your acceptance a buyer can withdraw their offer. Upon accepting an offer you will be asked to sign a contract agreeing to the sale.
2. Signing a Contract
When you sell property, it is your responsibility to prepare all necessary contracts. We recommend engaging a solicitor to prepare these contracts, as part of the conveyancing process.
Your solicitor and real estate agent will advise you on all the documentation necessary for a property sale. Make sure you tell them of any special conditions or limitations you want on the sale. Examples of common conditions that are incorporated into contracts are:
The contract becomes legally binding once signed by both parties, i.e. you and the buyer. A holding deposit may also be paid to you at this stage. There is no legal requirement to pay such a deposit, but it has become an accepted act of good faith by the buyer.
- Identity - A provision limiting the buyerís right to complain if there is a mistake in the description of the property, other than one of a very serious nature.
- Planning - A condition stating that the property is sold subject to all relevant planning regulations.
- Auction - If you sell at auction there will be specific conditions which will need to be put into the contract, including that the highest bidder sign the contract immediately and that the auctioneer has the right to resolve any disputes between bidders.
- Other - This may include a list of chattels you wish to remove from the property as well as a suitable settlement date.