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If you’re thinking about how to sell your house in Arizona, welcome to the club. Many Grand Canyon State homeowners are trying to capitalize on the housing market right now: Data from the Arizona Association of Realtors shows that the number of listings in the state has increased by nearly 15 percent versus the same time last year.
However, while home prices in Arizona surged during the pandemic, selling isn’t as easy now as it was in 2021. Buyers are frustrated with higher mortgage rates, and the increase in homes for sale is leading to more price drops. In fact, 44 percent of listings decreased their asking prices in June of 2022, according to Redfin.
How can you get your home ready to sell — and avoid having to reduce the price tag? Read on for a complete rundown of how to sell a house in Arizona.
Are you ready to sell?
You might be wondering whether you should sell now, or wait to see if you might be able to get even more later. If that’s your thinking, take another look at the stats above: The hot seller’s market in Arizona is starting to cool, and waiting longer may not be the best move.
However, that doesn’t mean you should rush. If you want to sell, be sure to have a plan in place for where you’re heading next. And if you’re trying to sell your house while buying another, be prepared for the potential frustrations of being a buyer in the current market. Be sure to consider the cost of living in the place you’re hoping to move, as well. And even if you’re staying in the same neighborhood, compare mortgage rates first to determine how much you will need to budget.
Preparing to sell
Once you’re comfortable with putting your place on the market, it’s time to get it in the best possible shape for prospective buyers.
Is it worth upgrading your home before you sell?
While it can be tempting to invest more money in your home before listing it, a dollar in doesn’t necessarily mean a dollar out. In fact, most expensive projects, like remodeling your entire kitchen, will not recoup their costs in the sale. Instead of undertaking a long, expensive project, think about these quick improvements that can boost your home’s value.
What should you repair before selling your home?
Think like a buyer: Are there any existing issues that would make you think twice about buying the home? For example, you probably wouldn’t be pleased to learn that the HVAC system was on its last leg — especially in the desert heat. As you think about what to fix and what not to fix, a professional real estate agent can be an invaluable resource. Agents have plenty of experience walking buyers through homes and understand what kind of problems can be immediate turn-offs, so don’t be afraid to ask for advice.
Should you have your home staged?
Staging your home — hiring a pro to make the house as welcoming and well-situated as possible — is a great short-term solution. How much you’ll pay for home staging depends on whether you are looking for minor help, like decluttering and repositioning the main living areas, or major assistance, like outfitting the home with rental furniture. Again, your real estate agent is the right person to ask about whether staging will make a meaningful difference in your final sale price. If you keep a tidy home that already looks ready for the cover of a magazine, staging is probably not necessary.
When is the best time to sell a house in Arizona?
Based on historical data, the best times to sell a house in Arizona are April and May. The late spring season is when homes spend the shortest amount time on the market — an indication that buying activity is strong.
You probably want to avoid the late fall and winter to list your house. Consider this data from Redfin: The typical home in Arizona spent 25 days on the market in June of 2021, but by January of 2022, that number increased to 35 days. And the longer your home sits on the market, the less desirable it looks to prospective buyers.
Finding a local Arizona real estate agent
You don’t have to develop a strategy for your Arizona sale on your own. In fact, you shouldn’t: Find a real estate agent you click with, who can help you determine when to list your place, which photos will catch attention online and how to attract a crowd to your first open house. While a Realtor’s services aren’t free — commissions typically run 3 percent of the sale price to your agent and another 3 percent to the buyer’s — it’s worth it. Data from the National Association of Realtors shows that agent-assisted sales command much higher prices than FSBO (For Sale By Owner) listings.
And keep in mind that real estate agent’s fees aren’t set in stone. Be sure to ask about the potential to negotiate a lower commission rate. For example, let’s say an agent is willing to decrease his or her cut from 3 percent to 2.5 percent. That may sound small, but on a $600,000 sale, it saves the seller $3,000.
Set a competitive asking price
If you’re wondering what your house is worth, the simple answer is, it’s worth however much someone is willing to pay for it. Your real estate agent will help you develop a pricing strategy based on the comps in the area. For example, if you’re selling a four-bedroom, four-bathroom home, you’re going to look at what other four-bed, four-bath properties nearby have recently commanded. Setting a price is all about inspiring as many buyers as possible to give the house a look — and who knows, it may even spark a bidding war. More than 40 percent of homes in Arizona sold for more than their list price in June of 2022, according to Redfin. Work with your agent to figure out how to add your property to that data set.
Documents and disclosures in Arizona
The most important document you will need to complete when selling your Arizona home is a seven-page residential seller disclosure advisory. This covers a wide range of issues that could impact the value of the property, from swimming pool issues to soil remediation. Be truthful, as any failure to disclose can create serious legal troubles down the road.
In addition, if your home is part of a homeowners association, be prepared to pull together a range of documents about the financial health of the association, too. Getting those can take some time, so it’s wise to request them as soon as you decide to list the home.
Need to sell your Arizona home fast?
If you don’t have any time to waste, consider these options to sell your house in Arizona faster than the usual traditional sale.
- iBuyers: Companies like Opendoor, Knock and RedfinNow focus on iBuying — you might be able to receive an offer to buy your home in less than a day, with a super-speedy closing timeline to follow. However, you will likely get a lower price from an iBuyer than you would on the open market. Plus, these companies don’t operate in every market: For example, RedfinNow only buys Arizona properties in Tucson and Phoenix.
- Cash sales: Look into companies that buy houses for cash, too. These are typically real estate investment companies that are looking for a bargain, so don’t expect a top-dollar offer. They want to fix up the property to flip it for a profit or rent it out to new tenants.
- Selling as-is: You can also opt to list your place as-is, which is a way to tell anyone on the buying side that you aren’t going to offer any concessions or spend time with the typical back-and-forth negotiations.
What to expect at the closing
After all the work you’ve done to get your home ready to sell, you have one final step to check off your list. There isn’t any real work involved, though: It’s just a matter of handing over some money to cover your end of the deal.
Cost of selling a home in Arizona
The biggest cost you should budget for as a seller is paying the real estate agents involved in the transaction. The payouts for both the buyer’s agent and the seller’s agent, typically 3 percent of the sale price for each, come out of your pocket. So, on a $500,000 sale, you would likely hand over $30,000 in Realtor fees. Here are some common closing costs for sellers:
- Title insurance: The seller usually covers the cost of title insurance in Arizona, and the amount depends on the purchase price and title company. For reference, the title insurance on a $500,000 property in Arizona might run around $1,840.
- Transfer taxes: Put a zero next to your calculations for real estate transfer taxes. These pesky fees are not permitted in Arizona, which is great news for your profit potential.
- Escrow fees: You’ll split an escrow fee with the buyer 50/50, and the cost depends on the sale price of the home. For example, on a home that sells for somewhere between $500,000 and $600,000, the escrow fee is $1,350. Your half would be $675.
- Seller concessions: If a buyer’s home inspection uncovers some issues that will wind up costing them money, don’t be surprised if they ask you to cover a portion of their closing costs to make up for it. You don’t have to say yes, but this request for concessions is standard practice if the home will require costly repairs.
- Attorney fees: While you’re not legally required to hire a lawyer to sell a house in Arizona, you should strongly consider it. The fee, which will range based on the attorney and the hours he or she spends on your transaction, can be well worth the peace of mind of knowing that you are protected in the deal.
Take the first step
Ready to get started on your sale? Set up interviews with a few different real estate agents — preferably a few that have been recommended by friends or work colleagues who have been happy with their experiences. Ask them these 10 key questions about how they will approach your home sale.
You need to complete a residential seller disclosure advisory to inform buyers about everything that could impact the value of the property. And while you don’t technically need a real estate agent or a lawyer, these two parties can make your life a lot easier by helping with negotiations and drawing up contract language.
You are not legally required to hire a real estate attorney when selling your home in Arizona. However, real estate contracts are very complex, and it’s smart to hire a legal expert to make sure you are protected.
You won’t have to pay any real estate transfer taxes when you sell your house in Arizona — a difference from most other states in the U.S. You will, however, need to pay your property taxes for the portion of the year you have occupied the home.
It depends on where your home is located and how attractive the property looks to buyers. In Show Low, for example, half of all home sales go to contract in less than 15 days. However, the median number of days on the market across the entire state is currently 28. If that feels too long, you can sell your home to an iBuyer much faster: Some might send you an offer in less than 24 hours.
The seller pays for the buyer’s title insurance policy in Arizona.
Sellers in Arizona enjoy the perk of not having to pay any real estate transfer taxes. However, you will need to pay for the buyer’s title insurance, and you may need to cover escrow fees and attorney fees. The biggest closing cost you should budget for is covering the real estate commissions, which typically add up to 6 percent of the sale price. So, if you sell your home for $500,000, you would owe $30,000 to the real estate agents involved in the process.