Recently, a couple of our buyer clients, in their own frustration, said something that really got me thinking.
I was sympathizing about how home selling in this crazy market has everyone stressed out. Their knee-jerk reaction was this: “What do sellers have to be stressed about?? They have all the power!”
The reality is, though, that sellers have plenty to be stressed about. And since our goal is to make every transaction as smooth as possible, it’s important that we identify the biggest pain points and figure out some solutions ahead of time.
Here are some of the things that our own seller clients deal with, and some of the ways we can help out:
Do I Buy First or Sell First?
In a market where inventory is tight and prices are rising faster than ever, home selling isn’t really the problem. Finding your next place, however, could be a challenge – especially if you have very specific wants and needs.
A family that must be in a certain school district or a work-from-home pro who needs a unique office space setup might need to buy first to make sure they get what they want.
On the other hand, if you’re cashing out to move to a rental, in with family, or out of town to a slower market, selling first could be the better option.
In either case, take the time to discuss your options with your home selling agent.
Get a realistic idea of what to expect in terms of home selling price and timeline. Ask them to help you consider all the potential pitfalls and create some solutions before you decide.
For example, get a referral to a good mortgage lender who can offer you options in case your purchase and your sale close at different times.
Ask about clauses that you could add to your purchase to protect you on the sale if it takes a little longer than expected to find a buyer.
Here’s an analysis of the decision making process that goes into this particular challenge.
All My Money is Tied Up in the House!
If it’s been a while since you bought a home, the required deposits on a purchase may be a bit of a shock.
Way back when, $2000 was enough to tie up an Agreement of Purchase and Sale.
These days, many home sellers are requiring up to 5% of the purchase price on deposit (in trust, of course). On a $700,000 average home in Hamilton, that’s $35,000 to be paid on the day after the agreement is signed.
A large number of home sellers don’t have that cash on hand, since they are depending on their equity to fund the purchase of the next house.
If that is your case, there is no need to panic or to be embarrassed.
Please talk to your agent before putting offers in on the house you want to buy.
We have connections to excellent partners who can lend you the amount you need for a very short term loan till closing when you can pay it back from the proceeds of your sale.
How Much Time and Money Do I Need to Spend on Preparing My House?
Everything is selling! Buyers have very little choice because of low inventory. Offers don’t even include inspections anymore.
All of those statements are true…but there is more to the matter than that.
Although it’s true that most listed properties are selling, there is still a ceiling where buyers refuse to go any higher on price.
Lenders must still support the value of a property before offering a mortgage to even the most qualified buyer. We still see overpriced and problematic properties sitting, unsold, for weeks and even months.
Buyers still have standards.
Low inventory is definitely what’s driving the market right now. With prices soaring, buyers are spending every last penny they have just to buy the house.
By the time they take possession, the well is dry, and there is nothing left for repairs, updates, and extras.
This means that the most saleable properties are the ones that need little to nothing after changing hands.
A buyer may not mind living in a house that’s a little outdated, but they will often walk away from a home that is painted in very personalized colours.
They may choose not to buy at all if all they see are homes that need immediate repairs, since they won’t be able to afford them.
As the seller, it’s worth your while to do the minor things that make your home most appealing.
Paint is profit-in-a-can. Neutral shades in every room appeal to the vast majority of buyers.
Repairs to leaky faucets, loose doorknobs and handrails, and other small maintenance items still go a long way toward getting more for your home – yes, even in this crazy market.
In addition to minor repairs, we can tell you what larger projects might bring you a higher price.
In some areas, adding a second suite adds huge value to a property, while in others, creating an additional parking spot could be the key to a bigger profit.
When your agent is familiar with neighbourhood sales, he or she can help you determine what is worth doing, and to source out professionals who can help you get it done.
A word about firm offers without a home inspection: Sellers must still disclose latent defects.
When a buyer agrees to forgo an inspection, they are taking the seller at their word that there is nothing hidden. In fact, there may even be a clause requiring the seller to “represent and warrant” that there is nothing materially wrong with the house.
It’s important to think past the frenzy of multiple offers.
When the dust from the circus on offer night settles, buyers and sellers have the same responsibilities to one another that they have always had in law, and that includes honest disclosure of latent issues.
What does this mean for you, our dear seller?
If you know that the roof or basement leaks, or the wiring is faulty, or there are other serious issues that would turn off potential buyers – look into the cost of repairs.
Talk to your agent and see how these will affect your sale price and process.
If you’re short on cash but would like to fix the issues, we may even be able to offer a solution to that problem!
The whole process of home selling is overwhelming.
There is a lot to think about.
While we as realtors can’t always do the grunt work of cleaning and fixing for you, we can help you find the right people for the job.
Our network of reliable trades people and other resources is as large as our community of realtors.
In these days of COVID prevention and precautions, real estate sales representatives are working hard to keep everyone safe. We institute contact tracing methods and safe showing procedures, and ensure that our listings are supplied with sanitizer for each person who attends.
Where necessary, we arrange for our listed properties to be professionally fogged and disinfected to protect everyone involved.
Listing a home for sale involves reams of paperwork written in legalese that we take care of for you – all you have to do is let us explain it, and sign off.
We can also handle the research that goes into listing a property. This may include verifying zoning, neighbourhood development projects, confirm the existence and location of lead pipe or buried oil tanks in older neighbourhoods, encroachments or easements on the property that need to be disclosed, and any number of other things that could affect a buyer’s decision.
We can help to pull existing documents on file from municipal offices, including surveys or building permits that have been issued in the past – even from before you owned the property.
All these things constitute due diligence that protect you, the seller, from problems or even lawsuits after closing.
Your agent will work with your lender and your lawyer to coordinate all the necessary documents and to ensure that funds are transferred to the right accounts in time.
We field questions and requests from buyers and their agents so that you don’t have to be glued to your phone.
Our goal is to make sure your transaction goes as smoothly as possible. And we will stay on task if there are any hiccups along the way to make sure that everything gets worked out.
We also work to guide you through your moving process – keeping you on schedule so that you know who to notify of your upcoming move, and when.
We are there to help you if you have issues with tenants or other challenges before closing.
One Step at a Time
If you need to sell your home, but are anxious about all the work you have to do, take a deep breath.
You can handle it – and we will help you any way we can from beginning, all the way to the end!
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