- Placing Your Home on the Market
- A Little Homework
- Your Home’s Special Features
- Property Profile Folder
- "What Conveys?"
- Comparative Market Analysis
Placing Your Home on the Market
The first step toward putting your home up for sale is to meet with your Professional Real Estate Agent at your home. This meeting is referred to as the "Listing appointment". Beforehand, it's also important to understand “who's who" and how brokers may co-operate to sell your home.
Listing Broker
An individual real estate broker whom the seller hires to represent themselves through a contract called a "Listing agreement". The listing Sales Agent is associated with the listing broker. The listing broker is directly paid the listing commission and then splits the commission with the listing Sales Agent.
Selling Broker
An individual who produces a buyer for the property and divides the commission with a listing broker. Such a transaction is considered a "Co-operative" sale because the house is listed by one broker and a buyer is provided by a second broker. If the listing broker also produces the buyer, then the listing broker receives both the listing and selling sides of the commission.
A Little Homework
Before the listing appointment, both the home seller and the listing Sales agent have some homework to do. While the home seller collects a list of documents requested by the professional RE Agent, the RE agent studies recent homes Sold in the area as well as homes that are for sale that are comparable to the seller's home,
Your Home’s Special Features
At the listing appointment, the listing agent will want to inspect the entire home and yard to become familiar with its special features and exact floor plan. You have probably enjoyed living in your home and have been pleased with its many unique features. Your listing Sales Representative will want to tell prospective buyers about the special features of your home and community. Be ready to be specific about schools, churches, daycare, nearby attractions and other desirable community features, as well as home features not readily apparent.
Remember, prospective buyers will be "comparison shopping" and keenly aware of subtle differences in homes for sale in the area. Be sure to tell your listing RE agent why yours is special from any other home.
Property Profile Folder
To enable the RE listing agent to prepare a ‘Highlight Sheet’ on the property, the home seller needs to provide several documents and information specific to the location and jurisdiction. This ‘Highlight Sheet’ is often left in the home for the convenience of prospective selling Sales Representatives. Because the list is long, you can understand why it's best to collect the papers before the listing appointment. These materials may include:
Pay-Off Notice
A letter signed by the home seller and mailed to the lender by the listing broker to notify the lender of the intention to pay off the mortgage to minimize prepayment of interest penalties to the seller. (Home seller should provide the broker with the lender's address, loan balance, assumable, years remaining on present mortgage, PITI. and the interest rate, if possible.)
Septic and Well Inspection
If the property is on septic/well, current inspections by local health authorities are required while the home is occupied. The listing Sales Representative will usually arrange for inspection after the contract is approved.
Order Lender Appraisal
Lenders usually require an appraisal to ensure the property is adequate collateral for a loan. An appraisal may be ordered before (paid by the seller) but is more often done after an "offer to purchase” is accepted (paid by the buyer).
Assessments/Easements
The RE listing agent will ask the home seller if any tax assessments or easements exist on the property that must be paid or included in the purchase contract and passed on with the land when sold.
Property Taxes/Condominium Fees
The home seller provides a record of property tax or condominium fee payments which the buyer will reimburse on a prorated share to the home seller at settlement.
Inspections
Many lenders of new mortgages may require an inspection certificate that shows the house is free of major defects.
The home seller should also provide a record of the past 12 months’ utility bills, including gas, electric, sewer, water, and trash where applicable. Most buyers will want to know the history of utility costs.
Helpful Documents
If possible, the home seller should provide the RE listing agent with the deed, house location survey, condominium bylaws or homeowners association documents, subdivision map, house floor plan, previous title search abstracts, legal description of the property (subdivision, section and lot), warranties on major systems or Home Owners Warranty, if still in effect, and copy of home homeowners insurance policy for endorsement in the purchase contract.
"What Conveys?"
In anticipation of a buyer's offer, the home seller must be ready to supply the RE listing agent with a specific list of the personal property that is included in the real estate property for sale. Examples of items to "convey" may include draperies, drapery rods, remaining heating oil, firewood, washer, dryer, refrigerator, stove, microwave, disposal, swimming pool chemicals, awnings, storm doors and windows, screens, blinds, shutters, window air conditioner, etc. The home seller should tag or remove items that do not convey.
When the home seller is ready to put the home on the market, the listing agreement is filled out indicating a specific time the agreement is in effect ("listing period") and signed by the seller. You've now hired a listing broker.
Comparative Market Analysis
Maximizing Market Value
Preparing a Comparative Market Analysis (CMA) is an important tool Professional RE agents use to help you earn the highest possible price for your home. A CMA involves looking at the public records of real estate business in your community to better understand market conditions.
There are four steps your Sales Representative will take in preparing your home’s CMA:
- Your RE professional will consider the amount paid for at least 3 recently sold homes in your community. These homes will be comparable in size to yours and together comprise a factual record of what buyers will pay.
- Your RE professional will then consider the asking prices of at least 3 presently listed homes in your community. Because these homes are similar to yours, these homes will be the benchmarks against which your home will be priced.
- Your RE professional will then consider the asking prices of at least 3 homes in your community that went unsold for at least 90 days. Similar to your home, these homes illustrate the dangers of overpricing your property.
- Finally, your RE professional will use all the price information gathered to arrive at an ideal asking price for your home.