How many times have you wondered, “How to sell my house?”
We’re going to help you better understand the ins and outs of the process as well as share some interesting facts along the way.
According to a Census Bureau study from a few years ago, it’s estimated that the average American will move 11 times in their life. Not all of these will involve the buying and selling of a home, but there’s a good chance at some point you will be involved in a house transaction.
If you’ve never been involved in selling a
home, perhaps because you inherited a property, or it’s been a long time since
you changed residences, there are several things you’ll want to know as you
work through the process. Here’s a quick
overview of what some of the most important things are.
What do I need to do if I want to sell my house?
With few exceptions, selling a home is not only a financial process, it is an emotional process too. That means, to be able to make the best financial decisions, you will first need to prepare yourself mentally for what lies ahead. Chances are, your home has been the backdrop for many great memories and milestones in your life and moving on from your home requires a certain amount of “letting go.”
Early on, you should start the decluttering process as early as possible. It’s amazing how quickly things can accumulate so you must be unmerciful keeping only the things that are most important if your family’s lives.
Concurrently, start vetting realtors to see which one will do the best job for you. Make minor repairs, invest in your home’s curb appeal, add a coat of paint where it strategically makes sense and think about retaining the services of a staging company. Although it’s not required, also consider a thorough home inspection to reveal issues now instead of being surprised later on at a time when anything bad could be used to bargain you down in negotiations.
What are the costs associated with selling a house?
The “cost of doing business” when selling a home can be quite an eye opener for many people. Nobody likes it when money is taken out of their bottom line, but if there is a silver lining for St. Louis home sellers, it is this. In a 2018 survey from USA Today, the greater St. Louis metro area (including communities such as Kirkwood, Chesterfield, Ballwin, Sunset Hills, Crestwood and others) ranked 34th out of the 35 largest metro areas in the United States. The total average cost in St. Louis and environs is just over $13,000 (approx. $9,000 in commissions and $4,000 in home prepping costs). By comparison, the most expensive market is San Jose where selling costs average more than a whopping $81,000.
Most costs are associated with the closing process which is when money and ownership documents are transferred. An assortment of fees are paid by both the sellers and the buyers and range from between 1% to 7% with sellers typically paying about half of that cost. Closing costs vary across a widely because there are different fees and legal requirements for each state and municipality.
Typically, the following items are included in the seller’s closing costs:
- Agent commissions
- Credit report
- Commitment fee
- Postage/courier fees
- Loan payoff costs
- Document preparation
- Prepayment penalties
- Unpaid HOA dues and HOA transfer fees
- Transfer taxes or recording fees (there is no transfer fee in Missouri)
- Attorney fees
- Buyer credits
How do you know if you should sell your house?
Sometimes, life dictates that you must sell your home. The death of a spouse, the loss of a job, retirement, a divorce or a major downturn in health can all be reasons that you may be forced to sell. But at other times, you have a greater say in the matter.
The primary consideration if you’ve got a choice is whether or not your current home still meets the needs of your lifestyle. Sooner or later, this changes for everybody.
For example, if you’ve got a growing family and you need more bedrooms because you have more children than you did a few years ago, then upgrading might make sense. People also move to be in better school districts or may move if there’s an uptick in crime that continues for an extended period.
Economics also play a role as well. If your career has taken off and you’ve been rewarded with a big raise or a promotion, you can now afford a better home than you were able to do so before. Or it could be something as simple as wanting a home with no stairs, less yard maintenance or any number of contributing factors.
Conversely, if your children have grown and moved out of the house, you may not need as much space as you did before. Empty nests also mean that your children may have move to other areas, and part of the reason you might consider moving is to be closer to them. You may not need to pack up and move if you live in Kirkwood and your son or daughter moves to Ballwin, but if they pack up and move to Vail, Colorado or Fort Lauderdale, Florida and you’re a close knit family, a move may be the right thing for you.
Another consideration is that if the market is healthy and mortgage rates are low, you can get top price for your home if you sell now instead of waiting until market conditions may not be as favorable.
How can I sell my house fast?
Here are some quick ideas when you’re looking for a fast sale:
- Find the right realtor.
- Listen to your realtor.
- Do your homework on the market, pricing and comps.
- Aggressively market your home by increasing curb appeal, decluttering, making repairs, hiring a professional stager, and undertaking a wide and multi-faceted marketing strategy in concert with your realtor.
- Sell at the right time of the year.
- Price it to attract attention which may actually start a bidding war.
- Be flexible. The faster you want it sold, the more you have to be willing to make concessions.
What paperwork is required to sell my house?
Paperwork varies by state and by county, so check with your real estate agent, an attorney or other professionals to see exactly what is required to sell your house. Here’s a list of documents that are either must-haves or good to have before, during and after the sales process. Consult your realtor if you have questions about any of these.
- Sales contract
- Appraisal from the purchase of your home
- Home repair and maintenance records
- Mortgage statement
- HOA records
- Homeowners insurance records
- Manuals and warranties for all home appliances and infrastructure
- Receipts and records for improvements such as room additions, etc.
- Comparative market analysis
- Listing agreement
- Seller’s net sheet
- Preliminary title report
- Mandatory disclosures
- Pre-inspection report
- Purchase offer and counteroffer
- Final purchase and sales agreement
- Contingency removal form
- Home inspection report
- Most recent tax statement
- Estimated settlement statement
- 1099-S tax
What inspections are required to sell my house?
By law, no inspections are required at either the state or federal level, but there are many inspections that are common and a good investment for both the buyer and seller. Buying a house is a major investment and protecting that investment should start early in the process. In addition, before lending money, banks will want to know that a house is in good shape and worthy of investment and they may require certain inspections to be performed.
Unless a contract calls for the seller to pay for a particular inspection, by default buyers normally pay since the inspections are for their benefit.
Here are some types of inspections that have become the norm in the home selling and buying process:
- Home inspection (comprehensive and done by the seller)
- Furnace and air conditioning
- Well water
- Septic system