When we started contemplating putting our home on the market, there were things that we did to prepare in hopes of gaining a better understanding of the real estate market and our particular situation before ever contacting a real estate agent. While these preparations didn't necessarily make our home sale process simple, they at least began to ready us for what was to come. Since our sales period occurred during 2010 and 2011 -- a time at which the real estate market was at one of it's worst points in US history -- our pre-sale steps made it easier for us to accept the reality that was to come during our home sale process.
The first thing we did before contacting a real estate agent was to pull some area comps on our own. Going online and searching other homes in our area that were on the market and that had sold in the past few months gave us a better idea of where we should start the pricing on our home.
Unfortunately, as first-time home sellers, we made a fatal mistake when it came to pricing our home. We let our real estate agent convince us of a higher starting point than we were really comfortable with. Even though we knew that we were starting way higher than we should, we put our trust in her experience and industry knowledge rather than ourselves…a huge mistake. We were left with our home overpriced and stagnating on the market even once we started dropping our price.
Get Finances in Order
We certainly wanted our real estate agent's input on adjustments that we should make to our home in the areas of repairs, updates and staging; however, there were certain things we knew we had to fix going into the process and costs that we were going to incur even without consulting our agent. Therefore, we began building a home sale budget. This budget included factoring in costs such as our 5 percent agent commission, $3,000 for repairs and updates, and another 3 percent of the sales price for seller repair requests and closing costs. We also factored in about 10 percent of our home's list price for negotiating, which ended up being well off the over 20 percent loss we actually incurred on the home.
Create a Home Repair/Update Checklist
In the process of building our home sale budget though, we came up with a laundry list of things that either needed to be fixed, painted, cleaned, or downsized. Therefore, we started a checklist. Actually it was a spreadsheet, which made it easier to remember and keep track of our progress as well as to add and delete items. We started our list early in the home sale process and then modified it as we got feedback from our real estate agent and as time passed and we added items we thought of along the way or as the seasons changed, and with them to-do items.
Form an Exit Strategy
We knew that eventually we would sell our home and a whole laundry list of items would be cleared from our home sale checklist, but in the process, selling our home would bring with it a whole new list of issues and things to do. From where to move to next, how to get there, what to do with our stuff and where to live while finding a new place, and how much this process would cost were all issues that we knew we'd eventually have to deal with. So we figured, why put it off?
Therefore, we built a moving checklist as well as a moving budget to put our plans down upon and get a better idea of the tasks we'd eventually have to take on as well as their costs. Things like hiring a moving company, storage fees for our stuff while we looked for a new place, the expense of a security deposit and first month's rent for an apartment, and similar costs were just a few of the expenses that we placed on our checklist to help us better prepare for what was to come.
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The author is not a licensed financial or real estate professional. The information provided in this article is for informational purposes only and does not constitute legal, financial or real estate advice. Any action taken by the reader due to the information provided in this article is solely at the reader's discretion.
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