How to sell your house: A complete guide for sellers

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Most home sellers dream of a stress-free sale where they simply list their house, quickly find a qualified buyer, collect the cash and hand over the keys. The reality is that selling a home includes many moving parts — some which you can control and some that are out of your hands.

For example, geography might influence how long your house lingers on the market and how much mark-up you can get away with. Where inventory is low, odds are you’ll sell faster and command a higher price. Conversely, in places where home sales have cooled, homeowners will likely have to work harder to attract the right buyer.

Then there are the factors within your control that have a big impact on the bottom line — things like hiring a really good real estate agent and maximizing your home’s online appeal can convert effort into dollars, and a more seamless closing.

Here are 12 steps to take to sell your home in 2021:

  1. Hire an agent who knows the market.
  2. Set a timeline for selling your home.
  3. Get a pre-sale home inspection.
  4. Don’t waste money on needless upgrades.
  5. Get professional photos.
  6. Put your house on the market.
  7. Set a realistic price.
  8. Review and negotiate offers.
  9. Anticipate seller closing costs.
  10. Weigh the tax implications.
  11. Gather necessary paperwork to close.
  12. Consider hiring a real estate attorney.

1. Hire an agent who knows the market

The internet makes it simple to delve into real estate agents’ sales history and professional designations, so you can choose the right person to work with. Look up real estate agents’ online profiles to learn how long they’ve been in the industry, how many sales they’ve done and what designations they may have earned. Pay attention to how and where they market their listings, and if they use professional photos or not.

“Any designation they’ve earned is a huge plus, because it’s a sign they’ve taken the time to learn about that particular niche,” says Jorge Guerra, an independent real estate broker and 2020 chairman of the Miami Association of Realtors in Florida.

Homeowners might be tempted to avoid hiring a real estate agent to save on paying the real estate commission and instead sell their home themselves. This is known as “for sale by owner,” or FSBO. The amount they stand to save on those fees can be thousands of dollars, usually 5 percent or 6 percent of the total sale price.

An experienced agent earns the fee, however, by exposing your house to the broadest audience to garner the best offers possible, and negotiating on your behalf. If you go it alone, you’ll have to personally manage prepping your home, marketing it, reviewing buyers’ offers and handling all of the negotiations and closing details. When working with an agent and negotiating a commission, keep this in mind: Real estate fees have fallen to all-time lows.

2. Set a timeline for selling your home

Selling a house is a major undertaking that can take two to four months from start to finish — or much longer depending on local market conditions.

As soon as you decide to sell your house, jump right into researching real estate agents to find someone with the right experience for your situation. At least two or three months before you plan to list, consider getting a pre-sale home inspection (more on that below) and identifying any problem areas, especially structural or mechanical issues that might need addressing to facilitate a sale. Leave enough time to schedule necessary repairs.

About a month before listing your house, start working on staging and deep cleaning in preparation for taking photos.

Here’s a checklist of things to do before listing your home:

  • Interview real estate agents and check their sales history.
  • Declutter, perhaps moving excess furniture to a storage unit.
  • Get an optional home inspection to identify any issues.
  • Schedule repairs if needed.
  • Deep clean.
  • Stage the house.
  • Take professional photos.

3. Get a pre-sale home inspection

A pre-sale home inspection can be a wise upfront investment, but it’s optional. A detailed inspection report can identify any structural or mechanical problems before you list your home for sale. It may cost a few hundred dollars, but an inspection will alert you in advance of issues that buyers will likely flag when they do their own inspection later in the process.

By being a few steps ahead of the buyer, sellers might be able to speed up the selling process by doing repairs in tandem with other home prep work. This means by the time the house hits the market, it should be ready to sell, drama-free and quickly.

4. Don’t waste money on needless upgrades

If you’re going to invest money into costly upgrades, make sure that the additions or updates you make have a high return on investment. It doesn’t make sense to install new granite countertops if you stand to break even or even lose money on the sale.

Here’s where a good real estate agent can help guide you. They often know what people expect in your neighborhood and can help you plan upgrades accordingly. If local shoppers aren’t looking for super skylights or a steam shower, then it doesn’t make sense to add them. A fresh coat of neutral paint, new carpet and a spruced-up landscape are typically low-cost ways to make a great first impression.

In general, updates to the kitchen and bathrooms provide the highest return on investment. If you have old cabinetry, you might be able to simply replace the doors and hardware for an updated look. For example, you can swap out those standard-issue kitchen cabinet doors for modern, Shaker-style doors in a weekend without breaking the bank.

5. Get professional photos

Work with your real estate agent to schedule a photo shoot to capture marketing photos of your home. High-quality photos are critical, since maximizing your home’s online appeal can make all the difference between a quick sale or a listing that languishes.

Some real estate agents build professional photography and virtual online tours into their suite of services. If they don’t, though, you might want to seek a photographer out on your own. The fee for professional photography will vary based on the size of your home, its location and how long it takes to shoot.

A professional photographer, with a strong portfolio, knows how to make rooms appear bigger, brighter and more attractive. The same goes for your lawn and outdoor areas. Dimly lit online photos can turn off homebuyers before they even have a chance to read about the lovely bike path nearby or the new roof you just installed, so well-taken photos can really pay off.

6. Put your house on the market

If a speedy sale is your goal, here are tips to get it market-ready and attract buyers:

Focus on the home’s online appeal

You’ve heard of curb appeal, but professionals say online appeal is now even more important.

“Your home’s first showing is online,” Guerra says. “The quality of your web presentation will determine whether someone calls and makes an appointment, or clicks on the next listing.”

Stage it and keep it clean for showings

Real estate agents will often suggest that sellers stage their homes. That simply means you remove excess furniture, personal belongings and unsightly items from the home while it’s on the market, and arrange rooms for optimal flow and purpose. If you’re in a slower market or you’re selling a luxury home, investing in a professional stager could help you stand out. Nationally, professional home staging costs around an average of $1,200, according to HomeAdvisor, but the range can be between about $520 on the low end and on up to $2,000.

Let someone else show the house

Make yourself scarce when potential buyers come to view your home. Let them imagine themselves in the space, free from the distraction of meeting and talking to you. Generally, buyers are accompanied by their own real estate agent to view your home, or you can ask your own agent to be present at showings.

“Seeing the current homeowner lurking can cause buyers to be hesitant to express their opinions and keep them from really considering your home as an option,” says Grant Lopez, former chairman of the San Antonio Board of Realtors in Texas.

7. Set a realistic price

Even in competitive markets, buyers don’t want to pay more than what the comparables, or “comps” show, so it’s crucial to get it right the first time. Pricing too high can backfire, while underestimating the home’s value might cause you to leave money on the table.

To price your home right from the start, rely on your neighborhood’s comps. These are data sheets about recently sold properties in a specific area. At a glance, you can get an idea of what homes around you are going for.

“A frequent mistake sellers make is pricing a home too high and then lowering it periodically,” Lopez says. “Some sellers might think this practice will yield the highest return but, in reality, the opposite is often true. Homes that are priced too high will turn off potential buyers who may not even consider looking at the property.”

If you’re not using an agent, check online listing websites to see how similar homes in the area are priced. Tracking actual sales prices may give you a better picture than asking prices. Homes with multiple price reductions may give buyers the impression there’s something wrong with your home’s condition or that it’s undesirable, so it’s best to eliminate the need for multiple reductions by pricing your home to attract the widest pool of buyers from the start.

8. Review and negotiate offers

After your home officially hits the market and buyers have seen it, ideally the offers will start rolling in. This is where your real estate agent (or attorney) is your best advocate and go-to source for advice. If you’re in a competitive market that favors sellers, buyers will likely offer at or above asking price, and you might even get multiple bids. On the other hand, if sales are slow in your area and you don’t get many offers, you may have to be amenable to negotiate.

When you receive an offer, you have a few choices: accept the offer as it is, make a counteroffer or reject the offer.

A counteroffer is a response to an offer, where you negotiate on terms and price. Counteroffers should always be made in writing and have a short timeframe (48 hours or less) for the buyer to respond. You can offer a credit for paint and carpet, but insist on keeping your original asking price in place, for example, or offer to leave behind certain appliances to sweeten the deal.

While your real estate agent may recommend you take the highest offer, look closely at other aspects of the offer, such as:

  • How the buyer is paying (cash versus financing)
  • Type of financing
  • Down payment amount
  • Contingencies
  • Requests for credits or personal property
  • Proposed closing date

If you’re lucky enough to get multiple offers, you might be tempted to go with the highest one, but be mindful that if a buyer is relying on lender financing, the property has to be appraised. Any shortfall between the purchase price and appraised value will have to be made up somewhere, or the deal could fall apart.

9. Anticipate seller closing costs

Both the homebuyer and seller have closing costs. The home seller typically pays the real estate agent’s commission, usually around 5 percent to 6 percent of the home’s sale price.

Some other costs commonly paid by the seller include:

Additionally, if the buyer has negotiated any credits to be paid at closing for repairs or closing costs, the seller will pay those too. Your real estate agent or the closing agent should provide you with a complete list of costs you’ll be responsible for at the closing table. While the buyer typically pays a bulk of closing costs, anywhere from 2 percent to 4 percent of the sales price, know that you might have to pay some fees, too.

10. Weigh the tax implications

The good news is many home sellers won’t owe taxes on profits from the sale of their primary home. If you’ve owned and lived in your home for at least two out of the previous five years before selling it, then you would not have to pay taxes on any profit up to $250,000. For married couples, the amount you can exclude from taxes increases to $500,000.

However, if your profit from the home sale is greater than $250,000 ($500,000 for married couples), then you need to report it to the IRS on your tax return as a capital gain.

11. Gather necessary paperwork to close

There’s lots of paperwork needed to properly document a home sale. Organize your papers all in one place to help things go more quickly. Some of the main documents you’ll need to gather include:

12. Consider hiring a real estate attorney

Not all states require sellers to bring a real estate attorney to the closing, but it might be worth it to have a legal professional on your side, especially if you’re selling your home solo. You can hire one to help fill out paperwork, review contracts and documents, identify potential issues and ensure the sale goes as smoothly as possible. Unless your state requires it, this is completely optional.

An attorney would be able to spot title issues that could hold up your sale for weeks or months — or even torpedo the deal — such as:

  • Outstanding liens or judgments
  • Trust issues
  • Mortgage balances
  • Tax issues
  • Encroachments

A real estate attorney could cost a couple thousand dollars, but the expense might be worth it to protect such a large financial transaction.

What’s next: Tangible takeaways

  • Hire an experienced real estate agent.
  • Maximize your home’s online appeal as well as curb appeal.
  • Consider investing in a pre-sale home inspection.
  • Declutter and stage your home.
  • Use comparables to price your house correctly from the start.

Learn more:

Written by
Jeanne Lee
Contributing writer
Jeanne Lee writes about mortgages, personal finance and enjoys finding ways for people to hack their finances.
Edited by
Mortgage editor