Getting the House Ready to Sell
Disconnect Your Emotions
When conversing with real estate agents, you will often find that when they talk to you about buying real estate, they will refer to your purchase as a "home." Yet if you are selling property, they will often refer to it as a "house." There is a reason for this. Buying real estate is often an emotional decision, but when selling real estate you need to remove emotion from the equation.
You need to think of your house as a marketable commodity. Property. Real estate. Your goal is to get others to see it as their potential home, not yours. If you do not consciously make this decision, you can inadvertently create a situation where it takes longer to sell your property.
The first step in getting your home ready to sell is to "de-personalize" it.
Uncluttering the House
This is the hardest thing for most people to do because they are emotionally attached to everything in the house. After years of living in the same home, clutter collects in such a way that may not be evident to the homeowner. However, it does affect the way buyers see the home, even if you do not realize it.
Clutter collects on shelves, counter tops, drawers, closets, garages, attics, and basements. You want as much open clear space as possible, so every extra little thing needs to be cleared away.
Take a step back and pretend you are a buyer. Let a friend help point out areas of clutter, as long as you can accept their views without getting defensive. Let your agent help you, too.
The kitchen is a good place to start removing clutter, because it is an easy place to start. First, get everything off the counters. Everything. Even the toaster. Put the toaster in a cabinet and take it out when you use it. Find a place where you can store everything in cabinets and drawers. Of course, you may notice that you do not have cabinet space to put everything. Clean them out. The dishes, pots and pans that rarely get used? Put them in a box and put that box in storage.
You see, homebuyers will open all your cabinets and drawers, especially in the kitchen. They want to be sure there is enough room for their "stuff." If your kitchen cabinets, pantries, and drawers look jammed full, it sends a negative message to the buyer and does not promote an image of plentiful storage space. The best way to do that is to have as much "empty space" as possible.
For that reason, if you have a "junk drawer," get rid of the junk. If you have a rarely used crock pot, put it in storage. Do this with every cabinet and drawer. Create open space.
If you have a large amount of foodstuffs crammed into the shelves or pantry, begin using them – especially canned goods. Canned goods are heavy and you don’t want to be lugging them to a new house, anyway – or paying a mover to do so. Let what you have on the shelves determine your menus and use up as much as you can.
Beneath the sink is very critical, too. Make sure the area beneath the sink is as empty as possible, removing all extra cleaning supplies. You should scrub the area down as well, and determine if there are any tell-tale signs of water leaks that may cause a homebuyer to hesitate in buying your home.
Closets are great for accumulating clutter, though you may not think of it as clutter. We are talking about extra clothes and shoes – things you rarely wear but cannot bear to be without. Do without these items for a couple of months by putting them in a box, because these items can make your closets look "crammed full." Sometimes there are shoeboxes full of "stuff" or other accumulated personal items, too.
Many people have too much furniture in certain rooms – not too much for your own personal living needs – but too much to give the illusion of space that a homebuyer would like to see. You may want to tour some builders’ models to see how they place furniture in the model homes. Observe how they place furniture in the models so you get some ideas on what to remove and what to leave in your house.
Storage Area Clutter
Basements, garages, attics, and sheds accumulate not only clutter, but junk. These areas should be as empty as possible so that buyers can imagine what they would do with the space. Remove anything that is not essential and take it to the storage area, or have a garage sale.
Costs of Repairs
Do not do anything expensive, such as remodelling. If possible, use savings to pay for any repairs and improvements – do not go charging up credit cards or obtaining new loans. Remember that part of selling a house is also preparing to buy your next home. You do not want to do anything that will affect your credit scores or hurt your ability to qualify for your next mortgage.
Plumbing and Fixtures
When looking at a house, prospective home buyers often do not really know what to do. So they play with things. They flick light switches. They open everything with a handle. They turn on all the faucets and flush all the toilets. Having nice shiny fixtures makes an impression.
All your sink fixtures should look shiny and new. If this cannot be accomplished by cleaning, buy new ones. If you don’t buy something fancy, this can be accomplished inexpensively. Make sure all the hot and cold water knobs are easy to turn and that the faucets do not leak. If they do, replace the washers. It sounds like hard work, but it's pretty easy -- even for the inexperienced.
Check to make sure you have good water pressure and that there are no stains on any of the porcelain. If you have a difficult stain to remove, one trick is to hire a cleaning crew to go through and clean your home on a one-time basis. They seem to be wonderful at making stains go away.
Ceilings, Walls, and Painting
Check all the ceilings for water stains, whether the leak is caused by plumbing or a faulty roof. Find the leak and repair it and make sure a proper job is done. Nothing irritates a buyer more than finding out - after the fact - about plumbing or roofing leaks. They will be talking about calling a lawyer faster than your car engine starts when you turn the ignition key.
If a water stain is left after something you have already repaired, do the cosmetic work necessary to improve the desirability of your home. That means painting.
You may have to paint anyway, especially if dirt has accumulated in spots or you have an outdated color scheme. Painting makes a home look fresh and new on the inside and never fails to impress.
Painting can be your best investment when selling your home. It is not a very expensive operation and often you can do it yourself. Do not choose colors based on your own preferences, but based on what would appeal to the widest possible number of buyers. You should almost always choose an off-white color because white helps your rooms appear bright and spacious.
Carpet and Flooring
Unless your carpet appears old and worn, or it is definitely an outdated style or color, you probably should do nothing more than hire a good carpet cleaner. If you do choose to replace it, do so with something inexpensive in a fairly neutral color.
Repair or replace broken floor tiles, but do not spend a lot of money on anything. Remember, you are not fixing up the place for yourself. You want to move. Your goal is simply to have few negative impressions upon those who may want to purchase your property.
Windows and Doors
Check all of your windows to make sure they open and close easily. If not, a spray of WD40 often helps. Make sure there are no cracked or broken windowpanes. If there are, replace them before you begin showing your home.
Do the same things with the doors – make sure they open and close properly, without creaking. If they do, a shot of WD40 on the hinges usually makes the creak go away. Be sure the doorknobs turn easily, and that they are cleaned and polished to look sharp. As buyers go from room to room, someone opens each door and you want to do everything necessary to create a positive impression.
For those who smoke, you might want to minimize smoking indoors while trying to sell your home. Actually, it is best to move smoking outside. You could also purchase an ozone spray that helps to remove odors without creating a masking odor.
Apologies to pet owners, but pets come with odors. You may have become used to them, but they are immediately noticeable to those with more finely tuned olfactory senses.
For those with cats, be sure to empty kitty litter boxes daily and use plenty of baking soda. For dog owners, keep the dog outdoors as much as possible, even those adorable lovable little dogs. You might also try sprinkling carpet freshener on the carpet on a periodic basis.
The Exterior of the House
Most real estate advice tells you to work on the outside of the house first, but unless there is a major project involved, it is probably best to save it for last. There are two main reasons for this. First, the first steps in preparing the interior of the house are easier. They also help develop the proper mind set required for selling - beginning to think of your "home" as a marketable commodity. Second, the exterior is the most important.
A homebuyer’s first impression is based on his or her view of the house from the real estate agent’s car. They call that first impression "curb appeal."
So take a walk across the street and take a good look at your house. Look at nearby houses, too, and see how yours compares. Then it may be time to go to work.
Is your landscaping at least average for the neighborhood? If it is not, buy a few bushes and plant them. Do not put in trees. Mature trees are expensive, and you will not get back your investment. Also, immature trees do not really add much to the appearance value of the home.
If you have an area for flowers, buy mature colorful flowers and plant them. They add a splash of vibrancy and color, creating a favorable first impression. Do not buy bulbs or seeds and plant them. They will not mature fast enough to create the desired effect and you certainly don’t want a patch of brown earth for homebuyers to view.
Your lawn should be evenly cut, freshly edged, well watered, and free of brown spots. If there are problems with your lawn, you should probably take care of them before working on the inside of your home. This is because certain areas may need to be re-sod, and you want to give it a chance to grow so that re-sod areas are not immediately apparent. Plus, you might want to give fertilizer enough time to be effective. Always rake up loose leaves and grass cuttings.
The big decision is whether to paint or not to paint. When you look at your house from across the street, does it look tired and faded? If so, a paint job may be in order. It is often a very good investment and really spruces up the appearance of a house, adding dollars to offers from potential homebuyers.
When choosing a color, it should not be something garish and unusual, but a color that fits well in your neighborhood. Of course, the color also depends on the style of your house, too. For some reason, different shades of yellow seem to illicit the best response in homebuyers, whether it is in the trim or the basic color of the house.
As for the roof, if you know your roof leaks, repair it. If you do not repair a leaky roof, you are going to have to disclose it and the buyer will want an entire new roof. If you know your roof leaks and you don't repair it and don't disclose it, look forward to hearing from lawyers at some point in the future. Otherwise, wait and see what the home inspector says. Why spend money unnecessarily?
The Back Yard
The back yard should be tidy. If you have a pool or spa, keep it freshly maintained and constantly cleaned. For those that have dogs, be sure to constantly keep the area clear of "debris." If you have swing sets or anything elaborate for your kids, it probably makes more sense to remove them than to leave them in place. They take up room, and you want your back yard to appear as spacious as possible, especially in newer homes where the yards are not as large.
The Front Door & Entryway
The front door should be especially sharp, since it is the entryway into the house. Polish the door fixture so it gleams. If the door needs refinishing or repainting, make sure to get that done.
If you have a cute little plaque or shingle with your family name on it, remove it. Even if it is just on the mailbox. You can always put it up again once you move. Get a new plush door mat, too. This is something else you can take with you once you move.
Make sure the lock works easily and the key fits properly. When a homebuyer comes to visit your home, the agent uses the key from the lock box to unlock the door. If there is trouble working the lock while everyone else stands around twiddling their thumbs, this sends a negative first impression to prospective homebuyers.
Remember: no matter how beautifully decorated a home may be, its true value hinges on practical considerations — how much space it offers, the neighborhood it's in, how many bedrooms and bathrooms it has.
Details of a Listing Contract
Obviously the name of the seller and the property address will be included in the listing contract. There are many other things that are included, too, and you should be aware of them.
Price and Terms of Sale
When setting the terms of sale, the main thing you are concerned with is the price. You should have a basic idea of what your home is worth by keeping track of other sales in the neighborhood. In addition to the price, you will disclose what personal property, if any, goes with the house when you sell it. Personal property is anything that is not attached or fixed to the home, such as washers, dryers, refrigerators, and so on.
There may be some item that is considered "real property" that you do not intend to include in the sale. Real property is anything that is attached to the home. For example, you may have a chandelier that has been in your family for generations and you take it from home to home when you move. Since the chandelier is attached to the house, it is considered "real property" and a reasonable buyer would normally expect it to go with the house. The listing contract should make clear that it does not, and your agent should also enter this information with the Multiple Listing Service.
Do you have a Security System and is it monitored? Do you lease or own this equipment? If it is leased, you need to advise this so the purchaser is aware and will either take over the monitoring or you will need to pay out your contract or take it with you to your new home.
Real Estate Commission
In most areas there is a "customary" percentage that real estate agents and companies expect to earn as a commission. The percentage varies from region to region, and depending upon whether it is residential real estate or commercial real estate. However, just like anything else in real estate, this amount is negotiable. When completing the listing agreement, you and your agent will agree on the amount of the real estate commission.
When you agree to a commission with a listing agent, you should keep in mind that there are usually two agents involved in most transactions. Most of the time, only part of the commission goes to the listing agent's company. The other portion goes to the company representing the buyer.
The listing contract also specifies when the commission is earned. Once you reach terms with a buyer, you have incurred two contractual obligations. One is to the buyer and the other is to your agent. If you should decide to cancel just because you've changed your mind about moving -- the agent has earned their commission according to the terms of most contracts. They will probably want to be paid.
Multiple Listing Service
Your listing contract should specify whether or not the house will be listed with the local MLS (multiple listing service). It is definitely in your interest to have the house listed. This is because your sales force is automatically multiplied by however many agents are members of the local MLS. If your house is not listed, then you only have one agent working for you instead of many. This is where selling "by owner" generally fails.
Owners see that an agent puts a sign in the yard, prepares brochures, holds open houses, advertises in the paper and on the internet, and they think this is how houses are sold. It is easy to understand why owners believe that, but it just isn't so.
Listing agents do those things for three main reasons. First, because the owners expect them to. Second, because it shows other sellers how much they do to market a home, and it gets more listings. Third, because it brings in clients who want to buy "some" house - though it probably will not be yours.
Practically no one buys the house in the ad or a home they visit during an open house. Think about your own experiences when you bought the house you are now selling. How did you find it? Probably through your agent, who found it in the Multiple Listing Service. The MLS is a huge network and practically every local agent is a member -- and those agents have clients looking to buy a home. That network is what sells your house.
Agency Duties of a Listing Agent
Many people think of the real estate agent as a salesperson. Many agents (perhaps most agents) would jump at the chance to be "just" a salesperson. But they aren't just a salesperson. Real estate agents are “agents”.
An agent is "responsible" to their clients. They have a duty, called a "fiduciary duty." This means the agent is responsible to act in the best interests of their client. A car salesman does not have to act in your best interests -- they just have to sell the car. It isn't that simple for real estate agents.
Real estate agents not only have to sell the house, they have to be responsible. That involves a lot of liability, which is one reason for all the disclosures and the pages and pages of contracts, and why they want to be paid for being more than "just" a salesman.
The listing contract will specify that your agent is acting as a "seller’s agent." This means that, in the sale of your house, they are working for you and only you -- and looking out for your best interests.
However, there may be times when your listing agent has a client who wants to buy your home. For that reason, there is a little "wiggle room" in the listing contract. If your agent also represents the buyer, the listing contract should specify that they provide an additional disclosure that details whether they continue to act as your agent or assume the duties of a “dual agent”.
The contract also provides permission for your listing agent to act as an agent for others on other transactions. They can continue to list other properties, and represent buyers looking at other homes besides yours.
A lockbox is a basically a padlock with a cavity inside where a key to your home can be placed. Only someone with a key (electronic or mechanical) or the combination can get into the lockbox and access the key to your home. Having a lockbox available at your house makes it easy for other agents to get access to your house. It is locked into place, usually on the front door or gas meter and cannot be removed. Only other agents can access the key that is located within the lockbox.
If you live in a condo or townhouse that is managed by a Strata Corporation, we will require any recent minutes from Council Meetings, Annual General Meetings, Special General Meetings, Bylaws, Financials for the current year, and any Engineers Reports. This information will help us to know more about your home and allow us to share this information with prospective purchasers. If you do not have these documents, we can purchase them from the Property Management Company, however, that usually takes a minimum of 7 days.
The Offer To Purchase
Once we receive an offer, we will arrange a time to present you with an Offer to Purchase or an Agreement of Purchase and Sale. Remember that the Offer to Purchase or Agreement of Purchase and Sale is a legal document and should be carefully considered.
Any offer or agreement will typically include:
- · Your legal names, the name of the purchaser and the legal civic address of the property.
- · The purchase price offered.
- · The chattels that will be included in the purchase price (e.g.: window coverings, appliances or a satellite dish). Whatever items included in the sale should be specifically stated in the offer.
- · The amount of deposit.
- · The Adjustment day – this is the day the lawyer uses for adjusting payments
- · The Completion day – this is the day all the paperwork is completed and transfer of title occurs.
- · The Possession day (date they take possession of the home) – usually 30 to 90 days from the date of the agreement.
- · Date when the offer becomes null and void.
- · Any other conditions that go with the offer, including property inspection and approval of mortgage financing, review of the strata documents, title search, property disclosure, removal of oil tank if any exists, etc.
The process of receiving an offer, making a counteroffer and then revising it again is not uncommon. The whole process can seem like a roller coaster ride – exciting, but stressful. It’s all part of making the deal work best for you and the purchaser. Once you make a counteroffer, you must remember that will render the offer void. Sometimes there are multiple offers on one property. We will represent you and work with you to put your best interests first, showing the differences between the offers and making suggestions. However, the ultimate decision is up to you.
Once the Offer is Accepted
Once all the conditions of the offer are fulfilled or dropped, it is time to start thinking ahead and making arrangements:
- Start looking at moving options – hiring a professional or doing it yourself.
- Make necessary address changes (utilities, services, post office).
An offer may include a clause that allows the buyer to revisit the property a couple of times before closing (after all the conditions are fulfilled) so that he/she canMeasure for window treatments, or bring in a tradesperson for a renovation or remodelling estimate.
Please remember, there are additional costs other than the commission when you sell your home. There are legal fees and disbursements. The Lawyer/Notary will charge for clearing the title to the property and reviewing the statement of adjustments. Disbursements are amounts the lawyer pays out for things like land title office charges, Property Transfer Tax, Mortgage payout penalties, courier and photocopy charges. Please make sure you understand the costs so you are not surprised in the end. Also, remember there will be HST added to many of the costs.
Closing Day / Completion Day
Closing day is the day when you sign all the documents with your lawyer/notary and legal transfer of title is processed. The date that money and title will change hands.
This is the day that buyers start paying for items such as maintenance fees, property taxes and utilities. This is usually the same day as possession.
This will be a busy day – you give up possession (keys) to your home. Please ensure you leave your home cleaned, and all the appliances in good working condition. The home needs to be in substantially the same condition as when viewed by the buyer. Please ensure any fixtures and window coverings remain in the home, unless otherwise agreed upon in the contract.We will arrange to pick up your keys prior to noon. The contract stipulates 12 noon as possession, but this can sometimes be adjusted in the initial contract – not after. Please provide all keys and clickers for parking if any.