If you’ve never sold a house before, you might be intimidated about where to start. Or maybe this isn’t your first time around and you’d like a refresher on the process tot steps to selling a house.
According to HomeLight’s Top Agent Insights Spring 2022 Report, 98% of agents surveyed said it’s a seller’s market — which is good news for homeowners looking to sell fast or for more money. A seller’s market means there are less homes on the market than buyers looking, encouraging buyers to make strong offers quickly. In fact, 83% of agents said inventory is lower than expected in 2022, and 85% of agents said prices are on the rise in their market.
Ready to get started? We spoke with Jody Parrish, who ranks in the top 2% of seller’s agents in St. Louis, Missouri, to get the details. This guide will teach you about the necessary steps to selling a house in 2022, from start to finish.
Getting your house in order
Once you’ve decided to sell, the first thing to do is get your house — and your mindset — in a place that’s ready to hit the market. Before contacting a real estate agent, you might want to take the following steps to see what your house might sell for.
Check home value
Chances are you’re curious about what your house will sell for in 2022. To check your home value, use HomeLight’s Home Value Estimator. This tool utilizes your home’s location, age, size, and more to calculate what it’s worth. Getting a handle on this number can help you figure out your goals and your budget for your next place.
Calculate equity and estimated net proceeds
Of course, your house’s value isn’t what you’ll end up pocketing at the end of your sale. To get a better idea of what you’ll be walking away from the transaction with, you’ll have to calculate your equity and estimated net proceeds. Use HomeLight’s Net Proceeds Calculator to determine how much you’ll make from your home sale after paying off your mortgage and factoring in closing costs.
Find a top local real estate agent
In order to achieve your most successful home sale, you’ll want to hire a top real estate agent. Top real estate agents bring expertise and experience to your transaction that can be invaluable to your end result.
Interview multiple candidates
There are plenty of real estate agents out there, and not all of them will be the right fit for you. In order to find top real estate agents in your area, use HomeLight’s Agent Match Tool. This tool will match you with three local real estate agents that are trustworthy and well-regarded in their field.
Once you get your matches, it’s vital to interview each one of your candidates to make sure you hire the right fit. Think of it like a job interview; you don’t want to bring on the wrong candidate for the job! Make sure to ask the agents if they can put you in touch with clients that can provide honest testimonials.
What to look for and what to avoid
It’s also important to ask about your agent’s statistics, especially those that most greatly impact your sale. For example, if you want a quick sale, you’ll want to ask about your agent’s average days on market. This statistic indicates how long the agent’s homes sit on the market before a sale.
Or, if you want to get the most money for your sale, you should look into your agent’s sales compared to other agents in your area. HomeLight’s agent profiles can give you more information on each of your agents.
You’ll also want to see how long your agent has been in the industry, and how many homes they’ve successfully sold throughout their career or during the last few years.
What are the red flags you should look for? Be wary of agents who don’t have much experience or who can’t provide client testimonials. Low-commission agents can also be a gamble. These agents take a lower percentage of your sale as commission, but usually in exchange for less expertise and less work on their end.
Sign the listing agreement
Once you find the agent you want to work with, you’ll have to sign a listing agreement with them. This agreement covers everything from what will be included in your home sale — like appliances and lighting fixtures — to how your real estate agent will be compensated. It also includes how your agent can market your home sale, such as on the MLS, using lockboxes to let potential buyers inside, and for-sale signs.
You can always negotiate your listing agreement before you sign, so make sure you go over everything carefully with your agent and ensure you have everything you want included!
What about FSBO?
For sale by owner is when you sell your home without the help of an agent, which can theoretically save you money on the seller’s agent commission. While going FSBO is always an option, a real estate agent can bring their expertise to your sale, making your life a whole lot easier. Working with a real estate agent can make the difference between getting the most money for your sale and leaving money on the table.
In fact, the average FSBO home sale in 2020 was for $260,000 compared to $318,000 for agent-assisted home sales according to the National Association of Realtors®.
Set a sale price
The next step to selling your house is setting a sale price. Deciding on a price is a process that takes a lot of time and analysis, especially on your agent’s part.
Order a pre-listing inspection
One of the steps to take before you set your sale price is a pre-listing inspection. A pre-listing inspection will give you an accurate understanding of your home’s condition and value, which can prevent having to knock down your sale price later when problems arise during the appraisal. The cost of a pre-listing inspection — typically about $330 — will come out of your pocket, but can be worth it in the long run.
Review agent’s comparative market analysis (CMA)
Agents use a comparative market analysis, or a CMA, to help price your home. These analyses take into account similar homes recently sold in your area to determine the fair market value of your home. For example, if you have a three-bedroom, two-story home zoned for a particular elementary school, your agent will find other homes that meet that criteria and use their recent sales prices to determine what your home might sell for.
Determine selling priorities and strategy
Another important step to selling a house is to determine what your priorities are for your home sale. For example, you might want to sell your house as quickly as possible so you can move or get on to another home purchase. Or, you might want to get the most money for your sale, regardless of how long it takes. Your priorities will affect your pricing strategy.
Prepare home for market
Now that you’ve found your agent and priced your home, the next step to selling a house is to prepare it for the market.
Make advisable repairs and upgrades
Your agent can help you determine what upgrades and repairs are worth the money before you list. Depending on the market conditions, your agent might recommend different repairs. For example, many agents recommend applying a fresh coat of paint before listing if it’s been a while, but you probably shouldn’t worry about upgrading your bathroom in a seller’s market.
You don’t want lots of your stuff out when it comes time to take photos or have people walk through the house. Not only is it advisable to clear your clutter out of your house and move it to the garage or to storage, it’s also a good idea to remove your personal items so buyers can see themselves in the space.
You’ll also want your home as clean as possible when you list. If you’re not confident in your cleaning abilities or you don’t have the time, consider hiring a cleaning company for a deep, move-out clean.
Curb appeal is very real; what your buyers see from the street is a vital part of their first impressions. Be sure to keep your lawn or outdoor areas in tip-top shape, even if it’s the winter. You may also consider refreshing your exterior with paint or simple landscaping to make that first impression even sweeter.
Marketing and showings
You can also speak with your agent about whether you should professionally stage your home. Some staging companies can stage your home virtually, while leaving your personal furniture in the home for the actual walk-through. Remember, buyers want to be able to see themselves in your space.
Agents also have relationships with professional photographers who specialize in real estate. Most buyers start their home search online, making it absolutely vital that your home looks as professional as possible on its online listing to grab buyers’ attention.
When you’re ready to begin letting the world know that your home is for sale and are accepting offers, your agent will list your property on the Multiple Listing Service (MLS). According to the National Association of Realtors (NAR), MLSs are private databases created and maintained by real estate professionals (agents, brokers, and so on) to help their clients buy and sell property. The “listing” in the title is another word for “a home for sale,” in industry terms.
Promotions online and offline
Your agent will design a marketing plan for your home, which will likely include both online and offline marketing. Online marketing includes listing the home on the MLS, sharing it on social media, and posting about open houses. Offline marketing includes fliers, listing the home in newspapers and magazines, and sharing the listing with other agents.
Additionally, your real estate agent will handle showings of your home. Most likely, you won’t be present during showings to help remove the emotional connection for both you and the buyers. Speak with your agent about a schedule showing that works for you, and what times are off-limits for showings. Your agent may also set up an open house to get as many buyers as possible in the home at one time.
Receiving and negotiating offers
Once your home has been marketed and buyers have seen it in-person, you’ll start receiving offers.
Reviewing and comparing offers
You’ll work with your real estate agent to review each offer and compare them to one another to find what’s best for you.
“Once we get the offer, we’ll go through [it] with them. Point out the good parts, the bad parts,” Parrish says.
Sometimes, the highest offer won’t always be the best offer. You’ll have to take into account contingencies, financing, and pre-approvals to find what offers work the best for you and your family.
Everything in real estate is negotiable. Your agent can help you negotiate with the buyer and their agent to compromise on an offer. Especially in a seller’s market, sellers have lots of sway with buyers, so don’t be afraid to ask for what you want out of an offer.
Due diligence period
Once you’ve accepted an offer and signed the offer agreement, you’ll enter what’s called a due diligence period. The escrow company or title company will take care of gathering the necessary documents and handling the payments between buyers and sellers. Meanwhile, you’ll have a few steps to take.
The buyer will order a home inspection to ensure the home is in accordance with state’s standards. Many buyers will include a home inspection contingency in their offer to ensure the sale can be terminated if there are any serious problems with the home. Once the buyer gets the report, they can request repairs.
In addition to the home inspection, the buyer will also order an appraisal. The appraiser objectively determines the home’s value to verify that the buyer isn’t paying more than what it’s worth — and that the bank isn’t lending them more money than it’s worth. Make sure your agent is at the appraisal and has a plan in case the appraisal comes back low.
Before your home sale can finalize, your title will need to clear to ensure that the house is yours and there are no outstanding claims against it. Your title company and agent will take care of ensuring your title clears.
Now you’ll need to take care of any repairs that you’ve agreed to completing for the buyer. Your agent can help recommend professionals who can complete the work in a timely manner.
The final walkthrough is the buyer’s last chance to check up on the house and ensure there are no more problems. Make sure the house is in “broom clean” condition to avoid any problems arising and costing you time and money.
Close the sale and move
Once you’ve completed the due diligence period, it’s time to close the sale. Your agent will walk you through every step of the process, but prepare for the following steps.
Review settlement statement
The settlement statement itemizes fees and credits and summarizes the finances of the entire real estate transaction. You’ll also find your net proceeds in this statement. You can go over it with your agent to ensure you understand every financial aspect of the sale.
Receive sale proceeds
After you and the buyer have signed all the final settlement agreements, you can collect your payment from escrow. Depending on where you live and what day of the week you close, you may have to wait for the funds to transfer.
Determine taxes owed
Speak with your agent and a tax advisor to see if you own any capital gains taxes on your home sale.
Lastly, you’ll need to transfer your utilities to the buyer to ensure the utilities are never shut off in between you moving out and them moving in.
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