Eric & Ray's Top 10 Tips
for Selling Your House
adapted from House Selling for Dummies
by Eric Tyson and Ray Brown
Eric Tyson and Ray Brown, who also wrote Home Buying for Dummies, have followed up with House Selling for Dummies. The book will help you whether you decide to go FSBO (for sale by owner) or get a real estate agent.
- Your most important house-selling decision is whether or not to sell. Take the time to research your options and the personal financial ramifications of each option before you sell. The expenses of selling your current house and buying another will gobble a large chunk of your house's equity (that is, the market value of your property less the outstanding mortgage balance). Before you sell your house, weigh the expected benefits of buying a new home against these transaction costs. Be sure to estimate your proceeds of sale and relocation costs before selling.
- Before you commit to selling your house, review the mortgage options for your next purchase, especially if you're trading up to a more costly property. Remember, mortgage lenders and real estate agents can't tell you how much you can afford to borrow; they can only tell you the maximum amount that you're eligible to borrow. To determine the price you can afford to pay for your next home, you must also consider your financial goals and objectives.
- If you do decide to sell your house, try to time the sale so that it closes simultaneously with the purchase of your next home. Unless you're wealthy enough to afford the luxury of owning two properties at the same time, don't close on the purchase of your next home before your current one sells.
- Weigh the pros and cons of selling your house yourself. Be realistic about the amount of money you can actually save by selling without an agent, and the amount of additional time and effort that you must invest. If you want to sell without a real estate agent, be sure to hire a good real estate lawyer and read a good house selling book cover to cover so you know what you're getting into.
- Field a great team. Selling your house usually requires that you hire and work with various real estate professionals (such as real estate agents, property inspectors, escrow officers, and, possibly, tax, legal, or financial advisors). If you put the right players on your team, you maximize your chances of a successful sale.
- Be sure to thoroughly review and negotiate the real estate broker's listing contract, which is a personal services contract between you and a real estate firm. For most sellers, a 90-day listing that puts your house in the local multiple listing service is best. Remember that commissions and other terms of the listing agreement are negotiable.
- Disclose, disclose, disclose. If you have any doubts as to whether to disclose a defect or problem with your house, err on the side of disclosure. Otherwise, you greatly increase your (and your real estate broker's) chances of being party to a lawsuit initiated by disgruntled buyers.
- Preparing your house for sale involves much more than just sticking a For Sale sign in your front yard. To increase your chances of an efficient, top- dollar sale, obtain a good house inspection to discover problems before they become deal killers, do the right corrective and cosmetic work before putting your property on the market, and time the marketing of your house to coincide with a strong selling season in your area.
- "What's it worth?" is the most critical question you'll ask when selling your house. To get the answer, examine sales of houses comparable to yours in size, age, condition, and location (a good agent can assist you). Price your house right, and it will sell, because informed buyers recognize the value after seeing other houses with unrealistically high asking prices.
- Get the word out. To create the most interest in and competition for your house, you must develop a comprehensive, well-coordinated marketing and advertising campaign plan.
Eric Tyson, MBA, is a financial counselor, syndicated columnist and author of five best-selling books including Home Buying for Dummies (co-author), Investing for Dummies and Personal Finance for Dummies. His work has been praised and featured in hundreds of publications including Newsweek, the Los Angeles Times, the Wall Street Journal, Kiplingers, and on PBS, ABC, the NBC Today Show, CNN, CNBC, CBS and National Public Radio.
Ray Brown is a 25-plus year veteran of the residential real estate profession. He wrote a syndicated column and currently hosts a weekly radio program, "Ray Brown on Real Estate." He has appeared on CNN, NBC, CBS, and in the Wall Street Journal and Time magazine.