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
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