“Guide to Selling Your Home” has been prepared by Real Estate Professionals to assist you in answering your questions about the selling process. It outlines the steps that will help you to obtain the best results when you list property for sale.
- Agree on a marketing plan
- Before you move
- Glossary of terms
- Determining the value of your home
- Avoid overpricing your home
- Preparing for the house inspection
- Preparing to show your home
- Renovating for resale
- Signing a listing agreement
- The major elements of an offer
- Understanding market conditions
Your property is not something you sell everyday. In fact, for many people it is their largest asset. A house is very complex to market and the process needs to be well organized. To do the job properly a plan is needed.
Put Suzanne Desrocher’s more than 20 years of experience as a Realtor® to work for you.
Use this helpful checklist as a reminder of the things you need to do before you move. For detailed moving information and a FREE, instant moving quote please click here.
Book the movers. You can choose to have the movers pack everything, or just the breakables, or you can pack yourself. It’s a good idea to obtain estimates from several different companies.
If you own your present home:
Arrange to have our gas, water, and electric meters read on the day you leave and have the bills forwarded to your new address. Have your oil tank read and filled before your sale closes, and provide a receipt to your legal professional if required.
If the water heater or furnace is rented, arrange for a transfer of the rental agreement to the purchaser.
Disconnect your telephone, cable TV, and water softener.
If you rent your present home:
Give necessary written notice to your landlord and make arrangements for the return of any monies you have on deposit.
At your new home:
Make arrangements for the gas and electric utilities, water softener, telephone and cable TV to be connected on the day the sale closes.
- Get “Change of Address” cards from the post office and send out well before moving day.
- Have the post office forward your mail to your new address.
- Cancel any contracted services and pre-authorized cheques.
- Inform gardening, dry cleaning, garbage pick-up, newspapers, magazines, diaper and other home services.
- Arrange for service at your new address.
- Obtain a letter of introduction from your current branch to help establish new accounts.
- Transfer trust or bank accounts and securities.
- Cancel or transfer social, athletic, civic, religious or business affiliations and memberships.
- Arrange for transfer of medical, dental, prescription and optical records.
- Change the address on your driver’s license(s) effective the day of the move.
- Collect all items out for cleaning, repair or storage. e.g. fur coats, dry cleaning.
- Make special arrangements for the moving of perishables, such as plants.
- Make special arrangements for the moving of your pets.
- Dispose safely of all flammable liquids as it is illegal for movers to carry them.
- AMORTIZATION PERIOD:
- The actual number of years it will take to pay back your mortgage loan.
- APPRAISED VALUE:
- An estimate of the value of the property. Conducted for the purpose of mortgage lending by a certified appraiser. This appraisal is not to be confused with a building inspection.
- Allows the buyer to take over the seller’s mortgage on the property.
- CLOSED MORTGAGE:
- A mortgage that locks you into a specific payment schedule. A penalty usually applies if you repay the loan in full before the end of a closed term.
- CONDOMINIUM FEE:
- A common payment among owners which is allocated to pay expenses.
- CONVENTIONAL MORTGAGE:
- A mortgage loan issued for up to 75% of the property’s appraised value or purchase price, whichever is less.
- DOWN PAYMENT:
- The buyer’s cash payment toward the property. The difference between the purchase price and the amount of the mortgage loan.
- The difference between the home’s selling value and the debts against it.
- HIGH-RATIO MORTGAGE:
- A mortgage that exceeds 75% of the home’s appraised value. These mortgages must be insured for payment.
- INTEREST RATE:
- The value charged by the lender for the use of the lender’s money. Expressed as a percentage.
- LAND TRANSFER TAX, DEED TAX OR PROPERTY PURCHASE TAX:
- A fee paid to the municipal and /or provincial government for the transferring of property from seller to buyer.
- MATURITY DATE:
- The end of the term, at which time you can pay off the mortgage or renew it.
- The person of the financial institution that lends the money.
- MORTGAGE INSURANCE:
- Applies to high-ratio mortgages. It protects the lender against loss if the borrower is unable to repay the mortgage.
- MORTGAGE LIFE INSURANCE:
- Pays off the mortgage if the borrower dies.
- The borrower.
- OPEN MORTGAGE:
- Allows partial or full payment of the principal at any time, without penalty.
- A mortgage option that enables borrowers to take their current mortgage with them to another property, without penalty.
- PRE-APPROVED MORTGAGE:
- Qualifies you for a mortgage before you start shopping. You know exactly how much you can spend and are free to make a “firm” offer when you find the right home.
- PREPAYMENT PRIVILEGES:
- Voluntary payments in addition to regular mortgage payments.
- The amount borrowed or still owing on a mortgage loan. Interest is paid on the principal amount.
- Paying off the existing mortgage and arranging a new one or re-negotiating the terms and conditions of an existing mortgage.
- Re-negotiation of a mortgage loan at the end of a term for a new term.
- SECOND MORTGAGE:
- Additional financing. Usually has a shorter term and higher interest rate than the first mortgage.
- The length of time the interest rate is fixed. It also indicates when the principal balance becomes due and payable to the lender.
- Legal ownership in a property.
- VARIABLE-RATE MORTGAGE:
- A mortgage with fixed payments, but fluctuates with interest rates. The changing interest rate determines how much of the payment goes towards the principal.
- SELLER TAKE-BACK MORTGAGE:
- When the seller provides some or all of the mortgage financing in order to sell their home.
The market ultimately determines the true value of your property.
Before you compare your home to similar properties and establish a competitive list price, the following points should be considered:
- Community Amenities
- Buyer Supply
- Financing Options
With more than 20 years of experience in the Ottawa real estate market, Suzanne Desrochers will assist you in doing just that. You will get a personalized in-depth comparative report on up-to-date market values with a thorough home appraisal and valuation of your property.
Getting to Know Your Market
A comparative market analysis is an indicator of what today’s buyers are willing to pay for a home. It compares the market activity of homes similar to yours in your neighbourhood. Those that have recently sold represent what buyers are willing to pay. The homes currently listed for sale represent the price sellers hope to obtain. And those listings that have expired were generally overpriced or poorly marketed.
Your Real Estate Professional will prepare a comparative market analysis for your home based on the most current market information. Together you and your Real Estate Professional will establish the proper list price for your home.
The single most important decision you will make with your Real Estate Professional is determining the right asking price for your property.
Once you’ve achieved a realistic sales price, you can count on your property being professionally marketed and promoted to bring more buyers to your door. You can also expect to sell your home for the best possible price in the lease amount of time.
The Benefits of Pricing Right
- Your property sells faster, because it is exposed to more qualified buyers.
- Your home doesn’t lose its “marketability.”
- The closer to market value, the higher the offers.
- A well-priced property can generate competing offers.
- Real Estate Professionals will be enthusiastic about presenting your property to buyers.
One step which is inevitable in the home selling process is a visit from a professional house inspector. The following are steps which should be taken to ensure your inspection is a success. It is a good idea to be aware ahead of time of any serious problems which may be present in your home so you will be prepared to deal with them.
- Ensure that past home renovations have not damaged the structure the home. Other structural damages to look for are whether termites have caused extensive damage, if settling of the home over time has caused damage to the foundation, and/or whether support beams and joists are strong and sturdy or cracked or otherwise damaged.
- Ensure that the electrical and wiring systems are safe and acceptable. Loose wires or incorrectly installed or wired receptacles, switches or electrical box problems are all hazardous and should be corrected. All homes should have a minimum of 100 amp service.
- Ensure there are no leaks evident. Water can run and leak into odd and unexpected places, causing extensive damage over time. If there are signs of water leakage, they can quite be often spotted by examining the underside of sinks and dishwashers, along ceilings, on floors or along basement walls. Plumbing fixtures, water-using appliances, drain pipes, water supply inlets and outlets and basements and roofs can all be causes and sources of water damage.
- Ensure that safety issues are resolved in your home. Trim foliage which may impair a safe view of the area around the home, ensure that windows open easily and close and lock securely and that entrances/exits to the home are able to be securely locked. Hazards such as hidden curbs, loose railings and/or stairs, unused wells which are not capped, etc., should be corrected.
- With respect to plumbing, ensure that all fixtures are in good working and free from large cracks. Faucets should run easily and shut off completely, proper grouting and caulking should be present around bathtubs, toilets and other fixtures should be bolted down securely and drains should be clog free. The home’s water heater should be in good working condition also.
- All heating and cooling systems may have to be checked to ensure they are relatively up to date, clean, in good working condition and have clean filters. Refrigerant should be checked in any air conditioning units and may require proper servicing.
- Also, a general, unbiased overview of your home by a neighbour or friend may reveal matters which need to be dealt with that you may overlooked.
First impressions are lasting impressions. You will want to make sure the buyers looking at your home are left with the best possible impression. Ann can help you achieve that goal.
- House in good repair
- House number easy to read
- Eaves troughs, down spouts and soffits in good repair
- Garage/car port clean and tidy
- Litter picked up
- Cracked or broken window panes replaced
- Lawns and hedges cut and trimmed, garden weeded and edged
- Walks shovelled and salted
- Boot tray inside front door
- Doorbell and door hardware in good repair
- Porch and foyer clean and tidy
- Chipped plaster and paint touched-up and replaced
- Doors and cupboards properly closed
- Leaky taps and toilets repaired
- Burned out light bulbs replaced
- Squeaky doors oiled
- Mirrors, fixtures, and taps cleaned and polished
- Seals around tubs and basins in good repair
- Floors cleaned, garbage containers empty
- Inside of closets and cupboards neat and tidy
- Appliances cleaned
- Countertops neat and polished
- All lights turned on
- Air conditioner turned on in warm weather
- Fresh air in house
- Fireplace lit in cooler weather
- Halls and stairs cleaned
- Drapes opened during daylight
- Carpets freshly vacuumed
- Fresh flowers in various rooms
- Jewellery and valuables locked safely away or taken with you
- Valuable property, such as objects of art, vases and figurines out of reach, out of sight, or locked away
- Pets absent, where possible, or contained during the showing, and litter boxes clean
When it comes to home renovations, one plus one does not necessarily equal two. The money invested in improving your home will not always translate into an equivalent return in the selling price of your home. However, with planning it is possible to both increase the salability of your home and even profit from your home renovations.
Renovations do not have to be extensive or expensive to earn a high rate of return. In fact, one of the cheapest and simplest improvements yields one of the highest paybacks. According to a study (1999 Renovations and Home Value Survey) by the Appraisal Institute of Canada (AIC), a fresh coat of paint on interior walls returns an average 73 percent payback. So, a $1,500 paintjob could be expected to increase a home’s selling price by $2,625 (a $1,125 profit).
To maximize saleability ensure that your new décor is modern and tasteful. Choose shades of white and tame versions of popular colours. Steer away from too many personal touches and custom work if you plan to re-sell. It is unlikely that your investment will be recouped and it may prevent the quick sale of your home. Also, try to keep renovations in harmony with the fashion of your neighbourhood.
The kitchen and bathroom are key areas to focus your renovation attentions. With average paybacks of 72 and 68 percent respectively, new fixtures, cabinets and tiles could be well worth the money and/or time and effort. The AIC’s study highlighted the top ten renovations and the average rate of return:
- Interior painting and décor – 73%
- Kitchen renovation – 72%
- Bathroom renovation – 68%
- Exterior paint – 65%
- Flooring upgrades – 62%
- Window/door replacement – 57%
- Main floor family room addition – 51%
- Fireplace addition – 50%
- Basement renovation – 49%
- Furnace/heating system replacement – 48%
According to another study (Prepare to Sell by HomeGain.com in California) smaller changes to a home can also reap hefty rewards. Any addition that brightens your home (such as new light fixtures) should be returned in the selling price by an average 84% of the cost of the renovation. The HomeGain study also suggests cleaning and de-cluttering (594% return) and landscaping (266% return).
As an expert on home sales trends in your neighbourhood, your Sales Professional can suggest which areas of your home could benefit from renovation and increase its value and saleability.
The first formal step in marketing your property is to enter into a Listing Agreement – a contract that commits your Agent to actively market your home for a specified period of time. It also commits you to a pre-established marketing fee that is to be paid upon the successful closing of the sale. Your Real Estate Professional may require the following documents:
- Plan of Survey or Location Certificate
- A Survey of your property which outlines the lot size and location of buildings as well as details of encroachments from neighbouring properties. This may be required in certain areas to complete the sale of your home. Your legal professional may recommend a survey, especially if significant changes have been made to your property.
- Property Tax Receipts
- Most Listing Agreements require that the current annual property tax assessments be shown.
- Mortgage Verification
- Few homeowners know the exact balance of their mortgage as it is paid down. You will be asked to authorize your mortgage lender to provide the figures required.
- Deed or Title Search
- This document is a legal description of your property and the proof that you own it.
- Other Documentation
- In some instances, it may help the sale of your property if you can provide prospective buyers with information on such items as annual heating, electrical, and water expenses, as well as any recent home improvement costs.
Note: In many provinces you will be required to sign a property condition disclosure statement.
- Depends on the market and the buyers, but generally, the price offered is different from the asking price.
- The deposit shows the buyer’s good faith and will be applied against the purchase price of the home when the sale closes. Your Royal LePage Real Estate Professional can advise you on the suitability of the amount of the deposit being offered.
- Includes the total price the buyer is offering as well as the financing details. The buyer may be arranging his/her own financing or may ask to assume your existing mortgage if you have an attractive rate.
- These might include “subject to home inspection”, “subject to the buyer obtaining financing”, or “subject to the sale of the purchaser’s property.”
- Inclusions and Exclusions
- These might include appliances and certain fixtures or decorative items, such as window coverings or mirrors.
- Closing or Possession Date
- Generally, the day the title of the property is transferred to the buyer and funds are received by the seller, unless otherwise specified (except in Manitoba and Quebec).
Note: In B.C. the Possession Date is usually 1 to 3 days after the closing.
The real estate market is always changing. It helps to understand how market conditions can effect your position as a seller.
We can provide you with current real estate market conditions and explain their impact.
The supply of homes on the market exceeds demand.
High inventory of homes. Few buyers compared to availability. Homes on the market longer. Prices tend to drop in this type of market.
Your home may take longer to sell. Less negotiating leverage in terms of selling price.
The number of buyers wanting homes exceeds the supply or number of homes on the market.
Smaller inventory of homes. Many buyers. Homes sell quickly. Prices usually increase.
May have more negotiating leverage and obtain a higher selling price for your property.
The number of homes on the market is equal to the demand or number of buyers.
Demand equals supply. Homes sell within an acceptable time period. Prices generally stable.
More relaxed atmosphere. Buyers have a reasonable number of homes to choose from.