SELLERS CORNER

Selling a home can be difficult, emotional and consume more time than expected. There are many things to think about and prepare for before you are ready to list a property.

PROPERTY PREPARATION

In order to get the most value from your home it's critical to prepare the house and property for sale. Homes that are clean, uncluttered and well-kept will sell faster and provide better curb appeal.

Market reports can provide insight to help you determine the best time to buy or sell and whether it's a buyer or seller market. As in any market, there are many things that have an impact on market swings and changes. In real estate specifically there are changes in supply and demand that affect the amount of days homes are on the market. 

While some of the impacts are related to current inventory and demand, availability of money and interest rates are just as critical. If the interest rates go up, it costs more to borrow money and can lower a person's buying power or amount they can afford. Homes that were obtainable to some may no longer be in reach when interest rates go up and the opposite is true when interest rates come down. The ability to borrow money and the amount of it available to mortgage lenders is controlled by the federal government. If the amount of money being made available is low, it makes it harder for buyers to obtain credit which results in fewer buyers.

The links below are helpful in the evaluation of the busiest or slowest times to buy or sell a home. The amount of days a home is on the market will help you pick the time you want to sell and how much competition you may see. As expected the amount of offers or supply may be a little lower than prime times of the year. To see the "days on market" for the county of interest, click on the links below

PREPARE FOR THE NEXT STEP

Many sellers focus on the process or selling activities and may not be ready for the next steps. The house may sell quickly or take longer than expected which can throw time lines out the window. Plan for a quick and long sale, review possibilities that may require you to live a short time in between permanent homes. If you have children, consider school and the effect the result of the move will have if a temporary living situation is needed.

Once the house is listed you will have potential buyers walking through and touching areas of your house. Be prepared to make available times for buyers to tour the house and agents to perform open houses.

Occasionally a seller will list their home and search for a new home at the same time. This is a good practice although avoid having to ask for a contingency on the property you wish to buy. If the home you are looking to purchase is contingent on the sale of your house, the seller may take another offer.

Another item many sellers do not consider is whether or not they are prepared to purchase their next home. Evaluating the buying situation that you will be in after the sale of your home is important and should not be overlooked.

Agent Representation

There are two forms of representation, buyer and listing agents. A basic understanding of each, where an agent commission comes from and its effect on transactions is important. Buyer agents represent the buyer and listing agents represent the seller. In some cases a broker (example ExecuHome Realty) may represent both parties but an agent may not represent both parties legally in the state of Maryland. If the broker is representing both parties they must utilize two different agents within the organization and all parties must agree to dual agency representation in writing.

Commissions are normally paid by the seller and negotiated at the time of the listing contract. The predetermined commission in the listing contract will be split between the agents and negotiated between the brokers. Neither the seller nor buyer will have to be involved in the commission splits among brokers and agents.

Many companies and agents will market low commission rates to attract sellers. More often than not, the commission percentage represented is what is paid to the seller agent and does not include the buyer commission.

When a contract is created it details the commissions to be paid to the buyer and seller agent. Most of the time the commission will be split evenly between the agents. In the event the buyer percentage is low, the buyer could end up paying the difference or choose another property.

Remember, buyers don't pay an agent commissions and most buyers will want representation since it costs them nothing. However, if a commission rate is too low, a buyer agent may require the buyer make up the additional amount. In some cases this could be resolved by asking for a lower price on the home to offset the buyer agent fee although this requires the buyer to pay out-of-pocket for the owed commission. In the end it's better to have a competitive commission for the buyer agent to eliminate any hurdles or extract burden on the buyer.

Listing Your Property

Listing agreements cover a wide range of information, set the commission rate and expiration. In the state of Maryland, it is illegal for a broker or agent to provide a client with a sellers agreement with no expiration or a built in automatic extension clause.

During the initial listing, an agent will ask you to provide any information about the property and known defects or damages. It is critical to be honest, clear and provide answers that are accurate as possible to prevent repercussions or contract termination with a buyer.

The agent will get pictures, create a compelling description for the listing and enter it on the Multiple listing service (MLS) which will automatically post your home to the all the digital home search applications and real estate search sites. It is important to make sure the home is represented well in the listing which means accurate details, highlighted features and great visuals.

If some of the appliances, heating or air conditioner is older, considering purchasing a one year home warranty that is included with the purchase. Home inspections will point out aging systems and a home warranty is an easy way to put those concerns aside.