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Selling A House As-Is: Our Writer’s Firsthand Guide | Bankrate

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When preparing to sell your home, getting the property into pristine show-ready shape can feel overwhelming — and cost a fair amount too. But instead of sinking more money into it when what you really want is to get rid of it, there’s another option to consider: selling the home as-is. This tells buyers that there will be no changes made, no concessions, no bargaining — what you see is what you get.

I speak from experience. When my father passed away, I decided to sell his house in as-is condition rather than put a lot of time, effort and money into fixing it up. This is my story — plus pros, cons and tips if you’re thinking of doing the same.

“As-is” is not, strictly speaking, a legal term — rather, it’s a contractual term. In real estate transactions, it means that the seller makes no guarantees or representations about the property’s condition or the working order of its features, and will do nothing to change the condition or features. And, crucially, it means that the buyer accepts these terms in purchasing the property.

I sold my father’s house as-is — here’s what I learned

The time had come to sell my old Kentucky home. My 90-year father had died, and I had no desire to move back to my birthplace. Built in the French Provincial style by my parents in 1963, the house was beautiful, with a pool and tennis court, surrounded by woods. But it hadn’t been updated in 15 years, since my mom’s death, and in his decline, my dad had let things go.

“Spare yourself the expense of renovating and the hassle of negotiating,” friends and real estate pros advised me. They thought people would want the property for the land, a three-acre lot, and the location, a peaceful suburb only 20 minutes from downtown Louisville. So I decided to sell the place in its existing state, as-is.

We listed it at $650,000. After some frivolous nibbles, a serious offer came in: $600,000. My broker said “take it,” but — feeling emboldened by experience in eBay bidding wars — I countered with $625,000. Sold! Well, that was easy, I thought.

Until the requests began.

I’d allowed the buyers a generous period of time to inspect the property and plan their renovations. But I wasn’t prepared for the pop quizzes that followed: Did the septic lines run under the tennis court? When was the oil tank last lined? Was the county ever going to run gas lines out to the neighborhood? Each one was accompanied by a follow-up question: If this turns out to be a big expense for us, can you adjust the asking price?

Each time, I furnished the requested info as best I could while ignoring the hints about the price. Then, just one week before the scheduled closing, the buyers suddenly got scared the house might have asbestos. Would I pay for a special inspection and removal if it were true? If not — basically a threat, not a hint this time — the sale was off.

I panicked: Could I afford, not just financially but emotionally, to put the house back on the market, especially since the prime summer selling season was nearly over?

But after a careful look at our purchase and sale agreement, sanity returned. “Remind these folks of the contractual facts of life,” I instructed my broker. They had agreed, in writing, to buy the home in its current state, with no repairs or concessions on my (the seller’s) part. That was the deal; that’s what “as-is” means. If they reneged now, I would sue them for breach of contract — and probably win, a real estate attorney who looked at the agreement told me.

After a tense few days, they finally backed down, and the closing went through as planned. I signed remotely, having canceled my flight during my moment of panic. After closing costs, the broker’s fee and paying off the mortgage, I netted a small profit.

Do I have regrets about selling the house as-is? To be honest, yes, a little. Not so much about the money — I was resigned to getting less — but because it didn’t save me as much hassle as I’d expected. Still, the as-is status did give me the grounds, and the guts, to stand firm at a crucial moment. I think Daddy, a lawyer and master negotiator, would have been proud.

Common reasons to sell a house as-is

Much of my decision to go the as-is route had to do with convenience. But people opt to sell homes in their current state for a variety of reasons, usually related to money, time or effort — or a combination of the three.

Finances: Home-improvement projects can be very expensive. There are already plenty of costs that add up when selling a house, and a home in disrepair can raise those costs even further. Selling a house as-is allows you to skip that expense.

Timeliness: The as-is status can also expedite your timeline. Let’s say you need to relocate for work and sell your home as quickly as possible. Undertaking a renovation project would seriously delay your listing. If there’s enough demand out there from buyers, selling as-is can help speed up the process.

Convenience: Sometimes, selling as-is just seems the most practical course. In cases where a home is inherited (like mine) or needs to be sold following a divorce, for example, the seller might opt for an as-is sale to avoid the hassle and responsibility of preparing the house for the market.

Does selling as-is lose you money?

Broadly speaking, properties listed as-is do tend to be priced lower: Buyers just aren’t going to offer as much if they know they’ll have to invest in repairs and renovations once they take possession.

It’s hard to set a specific percentage on how much less you will make selling as-is versus fixing the home up before listing it. Much depends on the condition of the property, its location and how competitive the local real estate market is. In a strong seller’s market, the price gap typically found between an as-is sale and a regular sale will be smaller.

And if a home is on a prime piece of property or in a highly desirable neighborhood — especially one that doesn’t see new listings often — its condition matters less because the location is paramount. That certainly characterized my situation. My family home was in a subdivision that had only 12 houses, all widely spaced throughout hilly terrain with river views. Lots as large as ours were getting rare in fast-growing Louisville, my broker noted.

Pros and cons of selling a house as-is

Just like any real estate transaction, an as-is home sale has upsides and downsides.

Pros

Fewer costs: Avoiding expensive repairs helps you avoid potential financial strain. Plus, selling a house as-is means there’s no pressure to make it look perfect — no need to pay for professional staging inside or enhanced curb appeal outside — which translates to less of a ding on your bank account.

Faster process: Rather than waiting weeks or even months for repairs and other projects to be completed, you can list your home on the market and start showing it immediately. The sooner you list it, the sooner it can sell — my own listing was up within weeks of signing the broker’s contract.

Smoother closing: The upfront knowledge that no repairs will be made means there’s less negotiation and no haggling back and forth over concession requests, which helps smooth the path toward a straightforward, uncomplicated closing (in theory, at least).

Cons

Reduced profit: Homes sold as-is generally fetch a lower price, due to the anticipated repair costs the buyers will have to shoulder. Skipping the repairs saves you money on the front end, but you can’t expect to price an as-is property the same way you would if it were in move-in-ready condition. If my father’s house had been thoroughly modernized and in tip-top shape, I might have listed it for $100,000 more, or even higher.

Fewer buyers: While some folks love a fixer-upper, many house-hunters are looking for move-in-ready properties and don’t feel comfortable taking on a “project.” So,the number of interested buyers will likely be less for an as-is listing, and selling could take longer. In my case, it took four months before a serious offer came along.

Financing challenges: Potential buyers might face difficulties in securing a loan for a house in poor shape, which can prolong the selling timeframe. It might even lead to the deal falling through, particularly if the home appraisal comes in short of the agreed-upon price.

5 tips for how to sell a house as-is

These tips can help get you to a smooth and successful as-is sale:

1. Be upfront about the home’s condition

Make it clear from the get-go — in the listing and any other marketing materials — that the home is being offered in as-is condition and that you will not be making repairs or addressing problems. And put it in writing in your purchase and sale agreement as well.

Star

Keep in mind: Make it clear from the get-go that you will not be making repairs or addressing problems.

It may be useful to get a pre-listing home inspection so that you can be specific about exactly what work is needed and offer transparency to potential buyers. Providing inspection details upfront can instill trust, making the situation more appealing to a buyer and possibly accelerating the sale. The inspection report can also help you determine a fair list price.

2. Remember seller’s disclosures

Selling as-is doesn’t excuse you from disclosing known defects. For example, if you know there’s a mold problem or a crack in the foundation, you’re legally obligated to inform the buyer. If you misrepresent the condition of the property, you could potentially be held liable for any issues that arise.

Nearly all states across the country have laws in place outlining what home sellers must disclose. Many have specific disclosure forms that sellers are legally obligated to complete and supply to buyers. And in many places, real estate brokers and agents are also required to disclose any known defects.

Star

Keep in mind: You’re responsible for disclosing information that’s within your personal knowledge — you’re not required to go searching for problems.

“Known” is the operative word here, though: You’re responsible for disclosing information that’s within your personal knowledge — you’re not required to go searching for problems. I carefully read and signed Kentucky’s disclosure statement, attesting that there were no issues I was aware of.

3. Keep things as tidy as possible

You might not be investing in any major upgrades, but that doesn’t mean you should give up on presenting your home in its best light. You can still make sure the property is neat and tidy. Keep the yard mowed, surfaces clean, beds made and dishes put away, and minimize clutter as much as possible. Be ready for viewings at all times, as you would with any home sale.

Star

Keep in mind: Looking dated is one thing, looking derelict is another.

You might also invest in some small fixes beforehand, as I did at my broker’s recommendation: replaced broken window panes, smoothed over wall cracks and repainted several rooms. All told, it came to about $1,600 — a small price to pay to spruce things up. Looking dated is one thing, looking derelict is another.

4. Know how low you can go

Think about what your rock-bottom price would be — the lowest offer you’d be willing to accept — and be ready to make a quick counter-offer if someone bids lower. That’s what I did: I had a $600,000 threshold in my head. Anything above that, I figured, was gravy.

Speaking of compromises: Even with an as-is listing, some buyers will still try to negotiate based on home inspection results, as mine did. If a few hundred (or thousand) dollars is all that’s standing in the way of making a deal, you can always agree to make a repair. Or, trim your asking price accordingly.

Star

Keep in mind: If a few hundred dollars is all that’s standing in the way of making a deal, you can always agree to make a repair.

However, if they’re asking for major modifications, as mine were, stand firm. I provided paperwork that proved recent repairs or attested to the condition of the HVAC and plumbing systems and other infrastructure. But I drew the line at agreeing to finance special inspections or carry out expensive upgrades — that would negate the whole point of an as-is sale.

5. Find a trusted real estate agent

It might be tempting to try to sell your house on your own to avoid paying a Realtor’s commission fee, but it’s probably smarter to enlist a professional who has experience selling as-is homes. An experienced agent can help you set a price that accurately reflects the value of the home, and show it in a way that helps buyers see its potential.

Star

Keep in mind: An experienced agent can show the home in a way that helps buyers see its potential.

My broker and his team certainly aimed for “the fixer-upper folks,” as he dubbed them. And I will always greatly appreciate the professional way he drew up our contract, making the as-is clause watertight enough for me to rely on it when I had to.

I sold my father’s house as-is — here’s what I learned

The time had come to sell my old Kentucky home. My 90-year father had died, and I had no desire to move back to my birthplace. Built in the French Provincial style by my parents in 1963, the house was beautiful, with a pool and tennis court, surrounded by woods. But it hadn’t been updated in 15 years, since my mom’s death, and in his decline, my dad had let things go.

“Spare yourself the expense of renovating and the hassle of negotiating,” friends and real estate pros advised me. They thought people would want the property for the land, a three-acre lot, and the location, a peaceful suburb only 20 minutes from downtown Louisville. So I decided to sell the place in its existing state, as-is.

We listed it at $650,000. After some frivolous nibbles, a serious offer came in: $600,000. My broker said “take it,” but — feeling emboldened by experience in eBay bidding wars — I countered with $625,000. Sold! Well, that was easy, I thought.

Until the requests began.

I’d allowed the buyers a generous period of time to inspect the property and plan their renovations. But I wasn’t prepared for the pop quizzes that followed: Did the septic lines run under the tennis court? When was the oil tank last lined? Was the county ever going to run gas lines out to the neighborhood? Each one was accompanied by a follow-up question: If this turns out to be a big expense for us, can you adjust the asking price?

Each time, I furnished the requested info as best I could while ignoring the hints about the price. Then, just one week before the scheduled closing, the buyers suddenly got scared the house might have asbestos. Would I pay for a special inspection and removal if it were true? If not — basically a threat, not a hint this time — the sale was off.

I panicked: Could I afford, not just financially but emotionally, to put the house back on the market, especially since the prime summer selling season was nearly over?

But after a careful look at our purchase and sale agreement, sanity returned. “Remind these folks of the contractual facts of life,” I instructed my broker. They had agreed, in writing, to buy the home in its current state, with no repairs or concessions on my (the seller’s) part. That was the deal; that’s what “as-is” means. If they reneged now, I would sue them for breach of contract — and probably win, a real estate attorney who looked at the agreement told me.

After a tense few days, they finally backed down, and the closing went through as planned. I signed remotely, having canceled my flight during my moment of panic. After closing costs, the broker’s fee and paying off the mortgage, I netted a small profit.

Do I have regrets about selling the house as-is? To be honest, yes, a little. Not so much about the money — I was resigned to getting less — but because it didn’t save me as much hassle as I’d expected. Still, the as-is status did give me the grounds, and the guts, to stand firm at a crucial moment. I think Daddy, a lawyer and master negotiator, would have been proud.

Common reasons to sell a house as-is

People opt to sell homes in their current state for a variety of reasons, usually related to money, time or effort — or a combination of the three.

Finances: Home-improvement projects can be very expensive. There are already plenty of costs that add up when selling a house, and a home in disrepair can raise those costs even further. Selling a house as-is allows you to skip that expense.

Timeliness: The as-is status can also expedite your timeline. Let’s say you need to relocate for work and sell your home as quickly as possible. Undertaking a renovation project would seriously delay your listing. If there’s enough demand out there from buyers, selling as-is can help speed up the process.

Convenience: Sometimes, selling as-is just seems the most practical course. In cases where a home is inherited (like mine) or needs to be sold following a divorce, for example, the seller might opt for an as-is sale to avoid the hassle and responsibility of preparing the house for the market.

Does selling as-is lose you money?

Broadly speaking, properties listed as-is do tend to be priced lower: Buyers just aren’t going to offer as much if they know they’ll have to invest in repairs and renovations once they take possession.

It’s hard to set a specific percentage on how much less you will make selling as-is versus fixing the home up before listing it. Much depends on the condition of the property, its location and how competitive the local real estate market is. In a strong seller’s market, the price gap typically found between an as-is sale and a regular sale will be smaller.

And if a home is on a prime piece of property or in a highly desirable neighborhood — especially one that doesn’t see new listings often — its condition matters less because the location is paramount. That certainly characterized my situation. My family home was in a subdivision that had only 12 houses, all widely spaced throughout hilly terrain with river views. Lots as large as ours were getting rare in fast-growing Louisville, my broker noted.

Pros and cons of selling a house as-is

Just like any real estate transaction, an as-is home sale has upsides and downsides.

Pros

Fewer costs: Avoiding expensive repairs helps you avoid potential financial strain. Plus, selling a house as-is means there’s no pressure to make it look perfect — no need to pay for professional staging inside or enhanced curb appeal outside — which translates to less of a ding on your bank account.

Faster process: Rather than waiting weeks or even months for repairs and other projects to be completed, you can list your home on the market and start showing it immediately. The sooner you list it, the sooner it can sell — my own listing was up within weeks of signing the broker’s contract.

Smoother closing: The upfront knowledge that no repairs will be made means there’s less negotiation and no haggling back and forth over concession requests, which helps smooth the path toward a straightforward, uncomplicated closing (in theory, at least).

Cons

Reduced profit: Homes sold as-is generally fetch a lower price, due to the anticipated repair costs the buyers will have to shoulder. Skipping the repairs saves you money on the front end, but you can’t expect to price an as-is property the same way you would if it were in move-in-ready condition. If my father’s house had been thoroughly modernized and in tip-top shape, I might have listed it for $100,000 more, or even higher.

Fewer buyers: While some folks love a fixer-upper, many house-hunters are looking for move-in-ready properties and don’t feel comfortable taking on a “project.” So,the number of interested buyers will likely be less for an as-is listing, and selling could take longer. In my case, it took four months before a serious offer came along.

Financing challenges: Potential buyers might face difficulties in securing a loan for a house in poor shape, which can prolong the selling timeframe. It might even lead to the deal falling through, particularly if the home appraisal comes in short of the agreed-upon price.

5 tips for how to sell a house as-is

These tips can help get you to a smooth and successful as-is sale:

1. Be upfront about the home’s condition

Make it clear from the get-go — in the listing and any other marketing materials — that the home is being offered in as-is condition and that you will not be making repairs or addressing problems. And put it in writing in your purchase and sale agreement as well.

Star

Keep in mind: Make it clear from the get-go that you will not be making repairs or addressing problems.

It may be useful to get a pre-listing home inspection so that you can be specific about exactly what work is needed and offer transparency to potential buyers. Providing inspection details upfront can instill trust, making the situation more appealing to a buyer and possibly accelerating the sale. The inspection report can also help you determine a fair list price.

2. Remember seller’s disclosures

Selling as-is doesn’t excuse you from disclosing known defects. For example, if you know there’s a mold problem or a crack in the foundation, you’re legally obligated to inform the buyer. If you misrepresent the condition of the property, you could potentially be held liable for any issues that arise.

Nearly all states across the country have laws in place outlining what home sellers must disclose. Many have specific disclosure forms that sellers are legally obligated to complete and supply to buyers. And in many places, real estate brokers and agents are also required to disclose any known defects.

Star

Keep in mind: You’re responsible for disclosing information that’s within your personal knowledge — you’re not required to go searching for problems.

“Known” is the operative word here, though: You’re responsible for disclosing information that’s within your personal knowledge — you’re not required to go searching for problems. I carefully read and signed Kentucky’s disclosure statement, attesting that there were no issues I was aware of.

3. Keep things as tidy as possible

You might not be investing in any major upgrades, but that doesn’t mean you should give up on presenting your home in its best light. You can still make sure the property is neat and tidy. Keep the yard mowed, surfaces clean, beds made and dishes put away, and minimize clutter as much as possible. Be ready for viewings at all times, as you would with any home sale.

Star

Keep in mind: Looking dated is one thing, looking derelict is another.

You might also invest in some small fixes beforehand, as I did at my broker’s recommendation: replaced broken window panes, smoothed over wall cracks and repainted several rooms. All told, it came to about $1,600 — a small price to pay to spruce things up. Looking dated is one thing, looking derelict is another.

4. Know how low you can go

Think about what your rock-bottom price would be — the lowest offer you’d be willing to accept — and be ready to make a quick counter-offer if someone bids lower. That’s what I did: I had a $600,000 threshold in my head. Anything above that, I figured, was gravy.

Speaking of compromises: Even with an as-is listing, some buyers will still try to negotiate based on home inspection results, as mine did. If a few hundred (or thousand) dollars is all that’s standing in the way of making a deal, you can always agree to make a repair. Or, trim your asking price accordingly.

Star

Keep in mind: If a few hundred dollars is all that’s standing in the way of making a deal, you can always agree to make a repair.

However, if they’re asking for major modifications, as mine were, stand firm. I provided paperwork that proved recent repairs or attested to the condition of the HVAC and plumbing systems and other infrastructure. But I drew the line at agreeing to finance special inspections or carry out expensive upgrades — that would negate the whole point of an as-is sale.

5. Find a trusted real estate agent

It might be tempting to try to sell your house on your own to avoid paying a Realtor’s commission fee, but it’s probably smarter to enlist a professional who has experience selling as-is homes. An experienced agent can help you set a price that accurately reflects the value of the home, and show it in a way that helps buyers see its potential.

Star

Keep in mind: An experienced agent can show the home in a way that helps buyers see its potential.

My broker and his team certainly aimed for “the fixer-upper folks,” as he dubbed them. And I will always greatly appreciate the professional way he drew up our contract, making the as-is clause watertight enough for me to rely on it when I had to.



This article was originally published by a www.bankrate.com . Read the Original article here. .

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Should I Sell Or Rent My House In Today’s Market? | Bankrate

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FluxFactory/GettyImages; Illustration by Hunter Newton/Bankrate

Key takeaways

Deciding whether to sell your house or rent it out depends on personal circumstances, such as immediate cash needs and future housing plans.

Selling might be the better option if you need the proceeds to pay for your next home or stand to make a large profit.

Renting it out could be a good choice if you’re looking for additional income or if you’re moving temporarily and plan to come back.

There are many reasons why a homeowner might want to move. But whatever your reason, one question still applies: What should you do with your current home? Depending on your financial situation and your local housing market, you might consider renting it out rather than selling. If you’re caught in the sell versus rent debate, here are some factors to consider, including the costs.

Should I sell or rent my house?

A home is the biggest financial asset most people own, and deciding what to do with it shouldn’t be taken lightly. There are pros and cons to both options: For example, selling gets you a large windfall of cash all at once, while renting earns you smaller increments of steady monthly income from your tenants. If you have somewhere else to live and can afford to hang on to the house, renting it will also allow you to continue building equity as home values go up. Take a look at the following scenarios to determine which path is best for you.

When selling your home is a good choice
If you need the cash to pay for your next house

If your ability to buy a new home relies on accessing the money tied up in the current one, then selling is the best option. That way, you can take all your proceeds from the sale and put it toward your new down payment. Buying a new home while selling your current one can be a tricky balancing act, so be sure to work with an experienced real estate agent who can guide you through the process.

If you have no interest in being a landlord

Managing a rental property is time-consuming and often challenging. Are you handy and able to make some repairs yourself? If not, do you have a network of affordable contractors you can reach out to in a pinch? Consider whether you want to take on the added responsibility of being a landlord or paying for a third party to take care of things instead.

If you stand to make a significant profit

Property values have risen all over the country over the past few years, and home prices remain high. Depending on how long you’ve owned your home, how much you paid for it and how hot your local market is, selling could net you a significant windfall. Take a look at nearby real estate comps to see how much homes similar to yours have been selling for.

If you are eligible for capital gains tax exemptions

If you do sell your home for a profit, you may be able to exclude up to $250,000 of capital gains from the sale (or up to $500,000 for married couples filing jointly) from your taxes. For this to apply, the home must have been your primary residence for at least two out of the last five years, among other criteria.

When renting your home is a good choice
If your move is temporary

If your move is short-term and you plan on returning to your current city in the future, you may want to keep your home and rent it out in the meantime. Knowing there will be a place for you to live when you return provides peace of mind — and when you factor in closing costs, it may even cost less than selling and purchasing another home at a later date.

If you want the rental income

Extra income can be hard to turn down! But if you decide to rent your current home and want to buy another one with a mortgage, keep in mind that lenders will consider rental income when determining your financing. In some cases, a lender will only allow a portion of your rental income to be counted as an income source. In addition, you will be carrying two mortgages at once, so make sure this is something you are financially able to take on.

If rental demand in your area is high

Is your home in a hot neighborhood with lots of buzz? Is it in an extremely desirable school district, near a vacation destination like a beach, or close to the best amenities in town? Evaluate the rental demand in your area — renting is much less stressful when finding a tenant is fast and easy. Research the local housing market to determine what other similar properties are charging in rent. You can also speak to a local agent or property management company to learn more about the rental demand in your neighborhood.

If you expect home values to rise in your area

It’s impossible to foresee with 100 percent accuracy where the housing market is headed. That being said, you may be able to make an informed prediction. If you expect that your current home’s value will increase within a few years or less, you might want to consider renting it out now and selling later, to take advantage of the price appreciation.

Selling vs. renting your home: Costs to consider

Both renting and selling a home will incur costs. One of the most important things to think about is whether the rental income you’d receive will be enough to cover the property’s mortgage and upkeep.

To determine how much rental income you can reasonably expect to earn, take a look at what other similar properties are charging and weigh that against the costs of owning and maintaining the property. From there, you can gauge whether you’ll be able to recoup your expenses, and maybe even turn a profit.

Costs of renting out a home

Mortgage: Even though you’ll be earning rental income, you’re still responsible for paying the mortgage, which may or may not be fully covered by the rent you bring in. The same goes for property taxes.

Insurance: Landlord insurance can cover certain costs, such as damage to the home or someone getting injured on the property. You can expect this to cost roughly 25 percent more than the typical homeowners insurance policy — which you’ll also still have to pay for.

Maintenance and repairs: You’ll need to keep up with routine maintenance to ensure the home is fit for tenants. As a rule of thumb, budget at least 1 percent of the home’s value every year (more if it’s an older property) to pay for maintenance.

Finding a tenant: To find a tenant, you’ll have to get the word out. Consider any marketing costs you may incur, such as taking out an advertisement. You may also need to pay for background and credit checks of potential renters — though you might be able to pass this nominal expense on to the tenant.

Vacancies: Consider, too, the cost of vacancies between tenants. If a tenant moves out and you don’t have a replacement, that’s income you’re losing out on.

Property management fees: Hiring a property manager makes being a landlord less onerous, but it will eat into your profits as well. These companies tend to charge a percentage of the rent price, typically around 10 percent.

HOA fees: If your home belongs to a homeowners association, you’ll also be responsible for HOA fees, which vary considerably depending on what type of amenities are offered.

Costs of selling a home

Agent commissions: For ages, the typical real estate commission has been between 5 and 6 percent of a home’s sale price, split evenly between the seller’s agent and the buyer’s agent and paid entirely by the seller. That is about to change, however, as a result of a legal battle recently settled by the National Association of Realtors. Beginning this summer, depending on the deal, buyers may be responsible for paying their agent’s commission directly. That said, a single agent’s fee is still a significant expense: On a $400,000 sale, for example, 2.5 percent comes to $10,000.

Home improvements: To get your home in shape to sell, you’ll likely have a few services to pay for. These might include sprucing up the landscaping, a thorough deep cleaning and making any necessary repairs. And paying a pro to stage your home can increase its desirability, potentially bringing in a higher price.

Closing costs: Sellers typically incur some closing costs beyond Realtor commissions, too, such as attorney fees, transfer taxes and title insurance.

Mortgage payoff: If you still have a mortgage on the home, once you’ve sold it, some of the proceeds will go toward paying off the remainder of your loan.

What if there’s a recession?

Some economists still predict a recession in the country’s near future. According to Bankrate’s most recent Economic Indicator Poll, the odds of a recession over the next 12 months are 33 percent. Before you make a final decision on whether to sell your house or rent it out, ask yourself how a serious economic downturn might affect your finances. Is your job stable? Is your savings strong? Would you still be able to manage two mortgages during a recession, or the possibility of less rental income than expected? If the answer to any of these questions is no, selling may be the safer option.

Bottom line

The question “should I sell or rent my house?” requires careful consideration of your financial situation, lifestyle and local housing market. To help guide your decision, consider the costs of both options, whether you’ll return to your current location anytime soon and if you’re interested in being a landlord.



This article was originally published by a www.bankrate.com . Read the Original article here. .

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How To Sell Your House In 2024: A Step-By-Step Guide | Bankrate

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Key takeaways

Selling a house can take several months from start to finish, so it’s crucial to plan ahead and stay organized.

Start by setting a timeline to stick to and hiring a local real estate agent who knows your market well.

Be sure to get professional-quality listing photos taken — National Association of Realtors data shows that 100 percent of homebuyers look at listings online.

Most home sellers dream of a stress-free sale in which they simply list their house, quickly find a qualified buyer, collect the cash and hand over the keys. If only it were that simple! In reality, selling a home involves many moving parts — some that you can control, and some that are out of your hands.

For example, geography might influence how long your house lingers on the market or how high of a list price you can get away with. In locations where competition is hot and inventory is low, odds are you’ll sell faster and command a higher price. Conversely, in places where home sales have cooled, you will likely have to work harder to attract the right buyer.

The real estate market has shifted significantly since the frenzied heights of the pandemic. Today, high prices are combining with high interest rates to create serious affordability challenges: The median price for a home is more than $400,000, and mortgage rates hit a 22-year high in 2023. It’s no wonder many buyers have little choice but to stay on the sidelines until either rates or prices (or both) come down.

So, as a seller, it’s smart to be prepared and control whatever factors you’re able to. Things like hiring a great real estate agent and maximizing your home’s online appeal can translate into a smoother sale — and more money in the bank. Here’s a nine-step guide to how to sell your house successfully.

Set a timeline: Start prepping your home well before you plan to list.

Hire an agent: An experienced agent who knows the market well can best position your home for local buyers.

Determine upgrades: Take on only projects your house really needs — you don’t have to upgrade everything.

Set a realistic price: Your agent can help you find the sweet spot.

List with pro photos: Buyers look at homes online first, so be sure you have a solid digital presence.

Review offers: Consider all factors, not just the highest dollar amount.

Weigh closing costs: Keep track of how much more you’ll need to pay at the closing table.

Consider an attorney: Legal expertise can help protect this significant financial transaction.

Close: Make sure you have all your documentation ready.

1. Set a timeline for selling your home

Selling a house is a major undertaking that can take several months from start to finish — or much longer, depending on local market conditions. So it makes sense to plan ahead and stay organized.

At least two or three months before you plan to list, consider getting a pre-sale home inspection. This isn’t mandatory, but it can be wise, especially in an older home. For a few hundred dollars, you’ll get a detailed inspection report that identifies any major problems. This alerts you in advance to issues that buyers will likely flag when they do their own inspection later. By being a couple steps ahead, you might be able to speed up the selling process by doing needed repairs in tandem with other home-prep work. Then, by the time your house hits the market, it should be ready to sell, drama-free and quickly.

About a month before listing your house, start working on deep cleaning in preparation for taking listing photos. Keep clutter to a minimum, and consider moving excess items to a storage unit to show your home in its best light.

2. Hire an agent who knows the market

The internet makes it easy to delve into a real estate agent’s experience, helping you choose the right person to work with. Look up agents’ online profiles to learn how long they’ve been in the industry, how many sales they’ve closed and what professional designations they may have earned. Pay attention to how and where they market their listings, and how professional their listings’ photos look.

“Any designation they’ve earned is a huge plus, because it’s a sign they’ve taken the time to learn about a particular niche,” says Jorge Guerra, president and CEO of Real Estate Sales Force in Florida.

Some homeowners might be tempted to save on paying a commission and instead sell their home themselves, without an agent. This is known as “for sale by owner,” or FSBO. The amount sellers stand to save on that fee can be significant, usually 2.5 percent or 3 percent of the total sale price. On a $400,000 home sale, for example, 3 percent comes to $12,000.

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Keep in mind: Real estate commissions are often negotiable.

However, a listing agent does a lot to earn their fee. For example, they can expose your house to the broadest audience and negotiate on your behalf to garner the best offers possible. If you go it alone, you’ll have to personally manage prepping your home, marketing it, reviewing buyers’ offers and handling all the negotiations and closing details.

When working with an agent, keep in mind too that real estate commissions are often negotiable. As a result, you might be able to get a break at the closing table. But, depending on the deal, you may still have to pay your buyer’s agent’s fee.

3. Determine what to upgrade — and what not to

Before you spend money on costly upgrades, be sure the changes you make will have a high return on investment. It doesn’t make sense to install new granite countertops, for example, if you only stand to break even on them, or even lose money. Plus, these improvements may not be necessary, particularly if inventory levels are low in your area (which they are in most areas these days). A good real estate agent will know what local buyers expect and can help you decide what needs doing and what doesn’t.

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Keep in mind: Inexpensive DIY projects can also go a long way. A fresh coat of neutral paint and spruced-up landscaping are low-cost ways to make a great first impression.

Updates to the kitchen and bathrooms often provide the highest return on investment. But inexpensive DIY projects can also go a long way: A fresh coat of neutral paint and spruced-up landscaping are low-cost ways to make a great first impression.

4. Set a realistic price

Even in competitive markets, buyers don’t want to pay more than they have to, so it’s crucial to get the pricing right. Going too high can backfire, while underestimating a home’s value might leave money on the table. To price your home perfectly from the start, consult local real estate comps. This information about recently sold properties in your neighborhood gives you an idea of what comparable homes around you are selling for, thus helping you decide how much you might reasonably ask.

“A frequent mistake sellers make is pricing a home too high and then lowering it periodically,” says Grant Lopez, a Realtor at Keller Williams Heritage in Texas and the former chairman of the San Antonio Board of Realtors. “Some sellers 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.”

In addition, homes with multiple price reductions may give buyers the impression there’s something wrong with it. 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.

5. Include professional listing photos

This step will likely involve your real estate agent hiring a photographer to take marketing photos of your home, and registering the listing with the local MLS (multiple listing service). Here are some tips to get your home market-ready:

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Keep in mind: You’ve probably heard of curb appeal, but pros say online appeal is now even more important.

Take professional photos: With the ubiquity of online house-hunting these days, high-quality photos are critical. A pro photographer knows how to make rooms appear bigger, brighter and more attractive. The same goes for the property’s exterior and outdoor areas.

Focus on online appeal: You’ve probably heard of curb appeal, but professionals say online appeal is now even more important. In fact, 100 percent of homebuyers use the internet to search for a home, according to the National Association of Realtors, so online listings are crucial. “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: Staging a home entails removing excess furniture, personal belongings and unsightly items from the home and arranging rooms for optimal flow and purpose. If you’re in a slower market or selling a luxury home, investing in a professional stager could help you stand out. Nationally, professional home staging costs an average of around $1,808, according to HomeAdvisor, but prices range between $792 and $2,840.

Clear out for showings: Make yourself scarce when potential buyers come to view your home. Let them imagine themselves in the space, free from distraction. “Seeing the current homeowner lurking can cause buyers to be hesitant to express their opinions,” says Lopez. “It could keep them from really considering your home as an option.” Generally, buyers are accompanied by their real estate agent to view your home. You can also ask your own agent to be present at showings.

6. Review and negotiate offers

Once buyers have seen your home, offers will ideally start rolling in. (Keep in mind, though, that with mortgage rates currently high, the number of buyers who can still afford to buy might be smaller than you’d like.) This is where a real estate agent is your best advocate and go-to source for advice. If your local market favors sellers, buyers will likely offer close to asking price, or possibly even above. On the other hand, if sales are slow in your area, you may have to be open to negotiating.

When you do receive an offer, you’ll have a few choices: accept it, make a counter-offer or reject the offer. A counter-offer is a response to an offer in which you negotiate on terms and/or price. You can offer a credit for fresh paint and carpet, for example, but insist on keeping your original asking price in place. Counters should always be made in writing and provide a short time frame (ideally 48 hours or less) for the buyer to respond.

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Keep in mind: You might be tempted to simply go with the highest bid, but look closely at other aspects of the offer, too.

If you’re lucky enough to get multiple offers, you might be tempted to simply go with the highest bid. But look closely at other aspects of the offer, too, such as:

Form of payment (cash versus financing)
Type of financing
Down payment amount
Contingencies
Concession requests
Proposed closing date

Be mindful that if a buyer is relying on lender financing, the property will have to be appraised. If there’s any shortfall between the purchase price and appraised value, that gap will have to be made up somehow, or the deal could fall apart.

7. Weigh closing costs and tax implications

In any real estate transaction, both parties must pay at least some closing costs. It has long been the custom that the seller pays the real estate agents’ commissions, which usually total between 5 and 6 percent of the home’s sale price. This can be a big chunk of change: For example, on a $400,000 home, 5 percent comes to $20,000. However, that may soon change due to a federal lawsuit, and as of late summer, homebuyers may pay their own agent’s commission.

Some other closing costs commonly paid by the seller include transfer taxes and recording fees. Additionally, if the buyer has negotiated any credits to be paid at closing — to cover repairs, for example — 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.

The good news is that you may not owe the IRS taxes on your profits from the sale. It depends on whether it was your primary residence, how long you lived there and how much you make on the sale. If you’ve owned and lived in your home for at least two out of the previous five years before selling it, then you will 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. If your profit from the home sale is greater than that, though, you’ll need to report it to the IRS as a capital gain.

8. Consider hiring a real estate attorney

Some states require sellers to have a real estate attorney to close on a home sale, but many don’t. Regardless of your state’s laws, the expense is worth it to protect such a large financial transaction. It may cost you a couple thousand dollars, but there’s a lot more money than that at stake, and it’s always smart to have a legal expert give everything the OK.

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Keep in mind: Even if your state doesn’t require you to hire a real estate attorney, it’s worth the expense to protect such a large financial transaction.

In addition, an attorney can help fill out paperwork correctly, review contracts and documents, identify potential issues and ensure the sale goes as smoothly as possible. If you’re not sure where to find one, your real estate agent can probably recommend someone.

9. Gather paperwork and close

Lots of paperwork is needed to properly document a home sale, so keep it organized all in one place to help things go more quickly. Your agent can help you make sure you’ve got everything you need. Some of the main documents you’ll need to compile include:

Original purchase contract
Property survey, certificate of occupancy and certificates of compliance with local codes
Mortgage documents
Tax records
Appraisal from your home purchase
Homeowners insurance
Home inspection report, if you had one
Seller’s disclosure statement

Finally, bring all that paperwork — plus payment of any fees and the keys to give the new owners — to the closing. Once everything is signed and handed over, your house is sold!

FAQs

What should I do first when selling my house?

Putting your home on the market is a major step, and like most big life decisions, it’s best to get organized before you dive in. The process can take several months, so once you decide you want to sell, the best thing to do first is to consider your timeline. When do you need to move? What date do you hope to be closed by? Make sure you give yourself enough time to prep the property for showings and find a real estate agent you trust before actually putting the home on the market.

What is the fastest way to sell my house?

If you’re wondering how to sell your house in a hurry, consider foregoing a traditional agent-assisted sale in favor of selling to a cash homebuyer or iBuyer. These companies make quick cash offers and close home sales very quickly — in a matter of a few weeks, or even less. But you likely won’t get as high of an offer as you’d get if you sold on the open market.

Do I need a lawyer to sell my house?

That depends on what state you live in. Some states require a real estate attorney to manage any sale transaction, some don’t. Even if it’s not a legal requirement, though, consider hiring one anyway — real estate contracts can be very complicated, and there is a lot of paperwork involved and a lot of money at stake. It’s worth the cost to have legal expertise looking out for your interests.

Do I need a Realtor to sell my house?

No. It’s perfectly possible to sell a home on your own with what’s called a for sale by owner (FSBO) listing. However, going without a real estate agent means all the work an agent would normally do — researching comps, determining the best list price, coordinating showings, negotiating with potential buyers — is up to you to do yourself. It’s a lot of work, and a big time commitment.



This article was originally published by a www.bankrate.com . Read the Original article here. .

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8 Things Realtors Want You To Know Before Buying Or Selling A Home

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Realtors are a wealth of knowledge about buying and selling homes. Listen to them.

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Whether you’re buying a home or trying to sell one, knowledge is power. The more knowledge you have, the more you’re empowered to make the right decisions. Good realtors and brokers are a wealth of information for buyers and sellers looking for ways to maximize their transactions. Here’s what they want you to know about buying and/or selling your home.

Understand The Process

According to Brett Ringelheim, licensed real estate salesperson at Compass in New York, before listing a seller’s property, he has an in-depth conversation about the entire process. “During this discussion, I share my experiences with other sellers, highlighting both the good and the bad,” Ringelheim says. He notes it’s crucial that sellers, especially first-timers, thoroughly understand the process before their property hits the market.

For example, one thing first-time sellers might not understand is that they should probably expect to be inconvenienced during the process. “Being flexible with showings and open houses is important, as it allows more prospective buyers to view the property, increasing the chances of finding the right buyer in a timely manner,” advises Mike Downer, broker associate at Coldwell Banker Realty in Naples, Florida.

Be Emotionally Detached

When selling your home, check your feelings at the door. According to India Headley, broker and team lead of Housed by Headley Team at EXP Realty in Connecticut, sellers need to be emotionally prepared to sell. “Once your house goes live on the market, you can anticipate ample traffic with showings, incoming offers that may falsely inflate or deflate your confidence in value, and once you actually sign a contract, there may be some understandable anxiety that kicks in,” Headley says.

However, she adds this is not the time to second-guess your decision when you start thinking of the memories and good times you’ve had in the house. People don’t buy your memories – they want to create their own. “Be proud that you maintained an asset that can serve someone else for years to come, and remember that the grass will always be greener where you water it, so let’s move,” Headley says.

Get A Pre-Inspection

If you get a pre-inspection before you put your home on the market, Headley says it can save everyone a lot of time. “If both parties can be made aware of things that are major and/or minor, we can deal with it more effectively upfront,” she notes.

Depending on the findings, Headley says your realtor can properly advise you how to remedy the issue by extending their knowledge, resources, and referrals. “It’ll also take some stress off the seller during the buyer’s due diligence period knowing that deal breakers shouldn’t be an issue,” she explains.

Understand That Buyers Have Different Opinions

One reason you should be emotionally detached is that you may hear some unflattering comments about your home. “Every buyer who views your property will have a different opinion, so it’s essential not to get discouraged by their feedback,” Ringelheim says. Your favorite features may be the very qualities that some buyers may hate. For example, you may love your all-white kitchen, but some buyers might consider it boring. And that garden you worked so hard to cultivate: Perhaps buyers can’t wait to remove it.

Just make sure that buyers don’t have legitimate concerns. Ringelheim agrees that before listing, it’s advisable to conduct an inspection to identify and address any potential issues. “Resolving these red flags before listing ensures a smoother transaction once a buyer is found,” he explains.

Downer adds that home maintenance is another crucial factor that sellers should be aware of. “Ensuring that the property is well-maintained and addressing any necessary repairs can significantly impact its appeal to potential buyers,” he says.

But keep in mind that your home isn’t for everyone, and some potential buyers will let their feelings be known, loud and clear.

First Impressions Matter

Even though it’s still a buyer’s market, you won’t get the best price if you just plop a For Sale sign in your front yard. According to Nicole Beauchamp, associate real estate broker at Sotheby’s International Realty in Manhattan, that first impression is everything – and this goes beyond just making sure that the home is sound.

“It is so important to prepare the home for sale, and investing in refreshing your home and staging, along with pricing realistically, can make a difference in how quickly you sell and for how much,” Beauchamp says. “Declutter, remove personal effects, and never underestimate the impact of a fresh coat of paint and a deep clean.”

While decluttering, here’s something that can be sensitive for some people. Ivan Chorney with the Ivan and Mike Team at Compass in Florida recommends removing personal items that could distract potential buyers. “This includes family photos, knick-knacks, collections, and out-of-season holiday decorations,” Chorney says. He explains that your personal items could prevent buyers from envisioning themselves living in the space.

“While neutral as a theme is overdone, the space must be a canvas for someone else, not an ode to your history, so make your home look less lived in by minimizing personal touches,” Chorney advises.

Your Home Might Not Sell Immediately

In the housing market, both sellers and buyers are trying to get the best price – and that number varies depending on which side of the transaction you’re on. “Depending on the property’s market and condition, sellers should be prepared for the possibility of receiving low offers and the chance that the property might not sell immediately,” Ringelheim says. “I explain the importance of reviewing recent comparable sales to set realistic expectations regarding pricing, and how long properties have stayed on the market.” If sellers want to aggressively price their properties, he says they need to understand the need for patience.

In fact, Downer warns that sellers need to understand that overpricing their home can often result in it sitting on the market for a prolonged period. “This can deter potential buyers and lead to the property becoming stigmatized, making it more challenging to sell at a later stage,” he explains.

Crunch The Numbers

Real estate advice often talks about understanding the financial component when purchasing a home. However, Beauchamp says it’s also important for both buyers and sellers to clearly understand the financial aspect.

Selling a house isn’t just about the purchase price you receive. “Sellers may have a home equity line of credit, and that balance will reduce how much money they receive,” Beauchamp explains. For buyers, she says they need to understand closing costs, and the other costs of home ownership. Both need to speak with their tax advisors to gain a realistic picture of the bottom line numbers.

Trust Your Realtor

It’s tempting to look at someone else’s home and compare your situation to what happened to that person. However, Headley recommends leaving the market analysis to the experts. “Just because you know someone whose house didn’t sell as easily as they anticipated or for a specific amount, doesn’t mean that you’ll face the same fate as a seller,” she says, adding there are many contributing factors that determine how properties perform, and a local realtor is your best resource for recommended time to sell, what buyers are looking for in your area, and purchase price.

Dawn David, licensed associate real estate broker with Corcoran in New York, says she wishes consumers better understood the extensive effort required to sell homes. “Sadly, when consumers try to act on their own, they may miss a critical window when a property is first introduced to the market by presenting it in a light that isn’t well received or is mispriced, resulting in a taint of sorts that others can’t pinpoint, but results in the property being ignored,” David says.

While experienced sales professionals can get you maximum value by determining an accurate fit for the actual state of the market, David says consumers selling without an agent are often misaligned with the reality of the market.

“Agents prepare you to capture all qualified interests with exhaustive tips for improvements, staging, decluttering, and we help you avoid the make-it-or-break-it qualities that immediately turn people off and prevent you from getting offers when most factors would indicate a potential offer is imminent,” she says. In addition, David says realtors and brokers present guidance on negotiating for the best price.

However, not all real estate professionals are created equally. “Make sure your licensed professional is up to date on the commission laws, latest marketing trends, and even ask them how they’re incorporating tech, like AI, to get your home sold,” Headley says. “Now is the time to ask questions more than ever and choose the agent that likes to answer them.”



This article was originally published by a www.forbes.com . Read the Original article here. .

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Real estate: What’s the success rate of selling your own home without an agent

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Q: I am the personal representative of my dad’s estate that is going through probate. I have a question about the seller’s disclosure statement. I lived in the house when I was a kid/teenager. I moved out when I turned 18, 40-plus years ago. I have never been on the title to the property. Do I still need to fill out a seller’s disclosure statement because I lived in the house?

A: Normally when a property is to be transferred (sold) because of an order by a probate court in the administration of an estate; the seller/executor/personal representative is exempt from filling out a seller’s disclosure statement except when they have lived in the property, as an adult, even if they had no ownership in it. As per the Michigan Association of Realtors legal counsel, an adult who has no ownership in the property and only lived in the home as a child/teenager or college student is exempt from filling out a seller’s disclosure statement. As always, consult an attorney when dealing with legal matters, especially an estate.

Q: We are going to be selling our home this year. My son-in-law says we should try selling it ourselves. I’m not comfortable doing that. Are there any statistics that show what the success rate is with for sale by owners?

A: That’s a good question. FSBOs (for sale by owner) sales accounted for 7% of home sales in 2023. The typical FSBO home sold for $310,000 compared to $405,000 for agent-assisted home sales, according to the National Association of Realtors. This sales price differential between for sale by owner and agent-assisted home sales has been going on for years. Sure, you can go in thinking that you will be saving a 5% to 6% negotiable commission, but on the other end, you are losing over 23% in sales price.

Market update

March’s market update for Macomb County and Oakland County’s housing market (house and condo sales) is as follows: In Macomb County, the average sales price was up by more than 6% and Oakland County’s average sales price was up by more than 5%. Macomb County’s on-market inventory was down by more than 30% and Oakland County’s on-market inventory was down by more than 28%. Macomb County’s average days on market was 33 days and Oakland County’s average days on market was 34 days. Closed sales in Macomb County were down by almost 26% and closed sales in Oakland County were down by almost 15%. The closed sales continue to be down as a direct result of the continued low inventory. Demand still remains high. (All comparisons are month to month, year to year.)

By the long-standing historical definition from the National Association of Realtors, which has been in existence since 1908, a buyer’s market is when there is a seven-month supply or more of inventory on the market. A balanced market between buyers and sellers is when there is a six-month supply of inventory. A seller’s market is when there is a five-month or less supply of inventory. Inventory has continued to stay low. In March, the state of Michigan inventory was at 1.6 months of supply. Both Macomb and Oakland county’s inventories were at 1.2 months. As you can see, by definition, it is not a buyer’s market.

Steve Meyers is a real estate agent/Realtor at RE/MAX First in Shelby Twp. and is a member of the RE/MAX Hall of Fame. He can be contacted with questions at 586-997-5480 or Steve@MeyersRealtor.com You also can visit his website: AnswersToRealEstateQuestions.com.



This article was originally published by a www.theoaklandpress.com . Read the Original article here. .

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‘Selling The OC’s Ali Harper: Why is someone without a real estate license on this show?

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Selling The OC Season 3 is one of the most perplexing seasons of reality TV I’ve ever witnessed for so many reasons. I have no idea, for instance, why Alex Hall lied about trash talking a colleague on a podcast instead of simply owning it. I have no clue why the show is trying to sell us on Hall and Tyler Stanaland’s romance when we already know they had a falling out. And I don’t know why — after two seasons of minimal screen time — Sean Palmieri loudly emerged from obscurity to claim his male coworkers are in love with him and/or tried to initiate a threesome. None of those sagas make much sense to me. But, hey! At least they involve real estate agents. The one thing I can’t wrap my head around in Selling The OC Season 3 is what the heck Ali Harper, a newly aspiring real estate agent without a real estate license, is doing on this real estate show.

From a business standpoint, numerous aspects of The Oppenheim Group’s Netflix shows are downright mortifying. Personal and professional boundaries are consistently crossed. Problematic behavior — from flirting to fights — runs rampant in the offices. And while Selling The OC’s agents successfully craft compelling reality TV, they’ve also created an extremely toxic work environment — one which edits suggest O Group boss Jason Oppenheim barely regulates. Perpetual drama and tarnished reputations aren’t a great look for business, but in the background of all the heated back and forths, it’s clear the O Group’s employees are experienced in real estate, working to sell houses, and making themselves and the company some serious cash. Everyone except Harper, because, again…she’s not a real estate agent yet!

As Decider noted in a previous piece, Harper made it to the real estate/reality TV big leagues by essentially flying to Orange County from her home in Nashville, walking into an O Group open house, and chatting up the show’s stars. That’s what Selling The OC wants us to think, at least. We have no idea how or why the former Miss Tennessee USA was actually cast on the show, but star Polly Brindle vouched for her and Jason took a chance on her, so here she is in all her inexperienced glory. 

Photo: Netflix

In Season 2 we saw Harper shadow agents, start learning the real estate ropes, and assure Jason that she loved people and houses, so she’d be perfect for the career. She was so committed to proving herself that she even bet Senior Realtor Associate Gio Helou she would sell a house within two months of getting her license. If she did, he agreed to strut through the office in a bikini as a nod to her pageant days. Harper set herself up as a potential real estate wunderkind, but when Season 3 rolled around, she reminded viewers that though she may have the personality, clothes, and fight required to fit in on the show, she sorely lacks the realtor skills and smarts that should be a prerequisite for joining any agency, especially one as esteemed as The Oppenheim Group.

In Harper’s Season 3 intro, she says she packed up her whole life in Nashville to move to Orange County and “will do anything it takes to make it here,” even calling her new career path in real estate “the ultimate goal” and saying “failure is not an option.” Later in the season she reveals she completed the 135 hours of real estate coursework required to become an agent in the state of California and can apply to take the exam, which sounds promising. But from asking “What exactly is a broker’s preview?” and bombing an “easy” pop quiz from Jason to causing an unprofessional scene at one open house and showing up unprepared to another, it doesn’t feel like Harper is “doing anything it takes” to make it in OC real estate. (As of Selling The OC‘s April 24 press day, Harper had yet to take the exam because she was waiting on her application to be accepted.)

The Orange County newbie wasn’t out of line for being frustrated by Alex Hall’s podcast lies, but she shouldn’t have publicly confronted her in the middle of a professional open house, causing a petulant scene that reflected poorly on The O Group. Harper’s time at the agency should have been cut short after Polly got an email from a fellow professional complaining about her behavior. (After all, cast members repeatedly spout some version of “There are no second chances in this town. People talk.”) Instead, Jason gave her the ultimate second chance by letting her run an open house for Gio — despite Alex Hall saying, “I would never have an unlicensed agent. I would rather not hold the open house,” and Gio adding, “[Agents] can jeopardize someone who is interested with some inexperience.”

Jason argued the opportunity would be a valuable experience for Harper; that the way to learn is to just dive right in. “I certainly never sat at a 13 million listing my first year,” he added. (The reason for that, I assume, is because it’s something to be earned rather than handed?) Anyway, all the Southern Charm in the world couldn’t help Harper answer the endless stream of questions at that broker’s open. Perhaps the edit did her dirty, but from the looks of the episode she had the general bed, bath, and square footage numbers down, and not much else. A once-in-a-lifetime opportunity like that required some Rory Gilmore-level cramming and preparation. Instead, a flustered Harper told prospective buyers that Gio let “the only girl in the office without a real estate license” run his open house, reminding us the mess wasn’t solely her fault. Jason, WYD?!

Photo: Netflix

When Jason sat Harper down post-open house, he grilled her about how long the average escrow is and what types of inspectors she’d suggest to potential buyers. She couldn’t answer. “These are things you need to know already. Those were easy questions and I feel like you had plenty of time to get moving on your real estate license,” he said, asking if she actually has a passion for real estate and is serious about the career. When Harper replied “absolutely,” he stressed, “Your business card has your name and my name on it…You have a very coveted desk here, so pass your test and start producing.” Again, I ask, why does she have a business card?!

Selling Sunset has welcomed its share of new cast members in the past — from current O Group realtor associates Bre Tiesi and Chelsea Lazkani to Season 7 surprise Cassandra Dawn — and despite their differences, they all had one crucial thing in common: real estate licenses.

I’m all for an underdog story, and if Harper is truly passionate about real estate then I encourage her to keep following her dreams, but couldn’t Jason have found someone with a real estate license to take a chance on?! As far as Selling The OC‘s cast goes, Harper is one of the most down-to-earth personalities and strikes a refreshing balance in the office. As a person, she seems fine! It’s the perplexing privilege of her going from zero experience to a top agency in the luxury real estate game that prevents me from fully embracing her.

If Selling The OC gets renewed for a Season 4, perhaps Harper will study her butt off, pass her real estate exam on the first try, and start successfully selling houses for the O Group, proving she’s deserving of a coveted desk. Until she brushes up on the real estate basics, however, I don’t think Gio has to worry about strutting his stuff in a bikini anytime soon.

Selling The OC Season 3 is now streaming on Netflix.





This article was originally published by a decider.com . Read the Original article here. .

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Selling A House In Massachusetts | Bankrate

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In a hurry to sell your Bay State home? The odds of selling relatively quickly are in your favor: Homes here spend much less time on the market than in most parts of the country, according to Redfin data.

But everything is relative, and if you need to relocate for work right away, for example, or need the proceeds from the sale ASAP, you may be hoping to speed the process along. There are a variety of ways to do just that, including working with one of the many cash-homebuying firms in the area. Here’s what you need to know to sell your house fast in Massachusetts.

How fast can you sell your home in Massachusetts?

The Massachusetts housing market is quite robust. Home prices here are high and getting higher: February Redfin data shows that the state’s median home price was $576,000, a nearly 10 percent jump from February 2023. And homes typically spent a median of 28 days on the market before going to contract — five days less than last year and a much quicker timeline than the national median of 48 days on market.

Your Massachusetts home won’t necessarily sell in this exact amount of time, though. A variety of factors can impact how fast a home sells: The time of year, your home’s size and condition and your exact location in the state all factor into the equation.

Need to move faster?

If you want to sell your home even faster, here are some options to consider that can expedite a sale:

Cash homebuyers: For maximum speed, your best bet is forgoing the traditional listing process and selling directly to a cash homebuying company, whether it’s a nationally known name like We Buy Houses or a smaller, local firm. These operations can often close a sale in just a couple weeks, or sometimes even faster. However, you will likely make less of a profit than you would on the open market.

iBuyers: Online homebuying firms known as iBuyers operate in a similar manner and with similar speed. Opendoor, one of the biggest, buys homes in the Boston area.

Listing as-is: Selling your home in as-is condition makes the process move faster because you don’t waste time on back-and-forth negotiations over repairs — the buyer knows upfront that what they get is what they see.

Flexibility: You can still sell relatively fast by listing your Massachusetts home in the traditional way. Be direct with your real estate agent about your need for speed, so that they can market it accordingly. This may require a bit of flexibility on your part, like being willing to price the home slightly lower to attract buyer attention or offering seller concessions to sweeten the deal. Your agent will know what is likely to work best in your specific market.

Selling your home fast for fair market value

If you want to ensure your home sale brings in the highest price possible, but you’d still like to move relatively fast, work with a local real estate agent. Look for someone who has experience in your specific area — and ideally, in your specific neighborhood — so you’ll have the best possible idea of your home’s market value. And discuss these topics before you list:

How should you price your listing?

Your agent will be instrumental in developing your pricing strategy. While you can take steps on your own to estimate what your house is worth, a pro agent will walk you through detailed local comps to understand what area buyers have recently paid for properties similar to yours.

Is it worth upgrading before you sell?

If you’re thinking about investing in a big renovation project, keep in mind that it could cost a pile of money, which you aren’t likely to fully make back — and take a long time, which you are trying to avoid. Rather than delay your sale with a major undertaking, consider quick and inexpensive upgrades, like a fresh coat of paint or upping your curb appeal.

What should you repair before selling?

As you think about what to repair versus what not to bother with, take a simple approach: Are there any glaring issues that would turn you off as a buyer? Put those at the top of your priority list. They will likely be worth the investment. If you’re anxious about potential problems, you might even want to consider a pre-listing inspection. Essentially, you’ll hire a home inspector to identify any issues, which gives you the option to address them before a potential buyer finds them.

Should you pay to stage your home?

First impressions are crucial in real estate. If you have the interior-designer touch, your home might already look open-house-ready. But if not, or if you’ve already moved out and the place is totally empty, it might be worth hiring professional stagers to help it shine. This can really make a home come to life and impress potential buyers, which in turn can help you sell faster, and maybe even for more money. Ask your agent whether your home could benefit from staging.

What do you need to disclose to the buyer?

Unlike in many states, which require home sellers to fill out lengthy property disclosures, Massachusetts law requires that you share just two pieces of information: whether the home has lead paint in it and whether it uses a septic system. If the buyer asks you a specific question, though, you must be honest. For example, if you know there have been problems with the plumbing in the bathroom and the buyer asks about it, you must tell the truth.

If you live in a property that belongs to a homeowners association, you will also need to hand over documents detailing the association’s financial health and the bylaws that a buyer will need to follow.

Closing day

Once you start preparing for closing, the deal is almost done — but it’s important to understand how much it’ll cost you to get to the finish line. Here are some common closing costs for sellers in Massachusetts:

Realtor commissions: The way real estate commissions work will change in July 2024, thanks to a major lawsuit that was recently settled. Until then, at least, the seller typically pays commission fees for both their own agent and their buyer’s. This expense usually comes to around 5 or 6 percent of the home’s sale price — for a median-priced $576,000 Massachusetts home, 5 percent is $28,800.

Title insurance: There is no law or set standard for who covers this cost in Massachusetts, but it’s customary for sellers to pay for title insurance in many states. The cost varies depending on the home.

Transfer taxes: The seller also usually covers the cost of real estate transfer taxes in Massachusetts. The rate depends on several factors but is typically $2.28 for every $500 of value. On a $576,000 sale, that adds up to around $2,626.

Escrow and wire-transfer fees: You may be charged nominal fees to cover the cost of the money being held in escrow and any money that needs to be wired in payment (for example, if you are paying off your mortgage with part of the sale proceeds).

Attorney fees: A lawyer must be present at real estate closings by Massachusetts law. This is often the lawyer representing the buyer’s lender, though — you as the seller are not required to hire your own lawyer. However, it’s smart to do so anyway when dealing with legal contracts and large amounts of money. Attorney fees will vary for each transaction.

Find a real estate agent

Massachusetts real estate can be complex. Selling to a cash homebuyer makes it simple, and fast. But if selling for top dollar is more important to you than sheer speed, working with a knowledgeable local real estate agent is your best path. To find the right agent, interview multiple candidates. Look for an agent who not only has experience, but has a working style that makes you feel comfortable.

FAQs

What’s the fastest way to sell my house in Massachusetts?


The fastest route to a sale is to work with a cash-homebuyer or an iBuyer. These companies can make offers within 24 hours, or sometimes even more immediately, and most can close the entire deal within a couple weeks. Keep in mind, though, that in exchange for this speed, you will likely make less money from the sale.

Can I sell my house without a Realtor in Massachusetts?


Yes you can. Selling your home without a professional agent is called a for sale by owner or FSBO transaction, and while it saves you from having to pay a listing agent’s commission, it is also quite a lot of work. Any tasks that would normally be done by a Realtor, including creating and marketing the listing, coordinating showings and negotiating with buyers, fall on your shoulders as a FSBO seller.



This article was originally published by a www.bankrate.com . Read the Original article here. .

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How real estate commission changes could make buying and selling a home cheaper

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Debra Kamin:

You’re absolutely right, that, for first-time homebuyers, it is often very difficult to scrape together just the money you need to be able to get that down payment to buy that first home, especially now, when the housing market is so tight and so expensive.

And in the past, one thing that homebuyers did not have to worry about was paying their real estate agents. So, as this settlement has its effects, one of the things we might see is that homebuyers now feel, oh, gosh, I also have to pay my real estate agent on top of everything.

But, most likely, what’s also going to happen is we’re going to see new models for compensation evolve out of this that didn’t exist before, where the way that we pay real estate agents, particularly on the buy side, might be completely different. It could be a flat fee. It could be by the hour. There’s all sorts of ways to pay agents that never existed before because there wasn’t a competition in the market that allowed those new methods to be introduced.



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Capital Gains Tax On Real Estate And Selling Your Home | Bankrate

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Key takeaways

Capital gains tax is a levy imposed by the IRS on the profits made from selling an investment or asset, including real estate.

Primary residences have different capital gains guidelines than rental and investment properties do.

It’s possible to lower the capital gains tax you owe by taking advantage of available deductions, exemptions and exclusions.

Naturally, you want to make a nice profit on your home when you sell it. But beware a bite in your earnings when tax day rolls around: the capital gains tax. If your home has substantially increased in value, you could be liable for a substantial sum when you pay your annual income tax.

Fortunately, there are ways to avoid or reduce the capital gains tax on a home sale to keep as much profit in your pocket as possible. Here’s everything you need to know.

What is the capital gains tax on real estate?

Key terms

Capital gains tax
A levy imposed by the IRS on profits made from the sale of an asset, such as stocks or real estate — that profit is considered taxable income.

Long-term capital gains
A tax on assets held for more than one year.

Property value
The amount a buyer is likely to pay for a real estate asset (i.e., property).

Broadly speaking, capital gains tax is the tax owed on the profit (aka, the capital gain) you make when you sell an investment or asset. It is calculated by subtracting the asset’s original cost or purchase price (the “tax basis”), plus any expenses incurred, from the final sale price.

Special rates apply for long-term capital gains on assets owned for over a year. The long-term capital gains tax rates are 15 percent, 20 percent and 28 percent (for certain special asset types, like small business stock collectibles), depending on your income.

Real estate, including residential real estate, counts as a taxable asset. Therefore, any financial gains from a home sale must be reported to the IRS: You calculate and pay any money due when filing your tax return for the year you sold the property.

While its rates are typically lower than ordinary income tax rates, the capital gains tax can still add up, especially on profits for big-ticket items like a home — the largest single asset many people will ever own. The capital gains tax on real estate directly ties into your property’s value and any increases in its value. If your home substantially appreciated after you bought it, and you realized that appreciation when you sold it, you could have a sizable, taxable gain.

How much is capital gains tax on a primary residence?

Calculating capital gains tax in real estate can be complex. The tax rate depends on several factors:

Your income tax bracket
Your marital status
How long you’ve owned the house
Whether the house was your primary residence, a secondary residence or an investment property

Star Alt

Keep in mind: The tax is only assessed on the profit itself. If you purchased a house five years ago for $250,000 and sold it today for $500,000, your profit would be $250,000. (Though there are deductions you could take that would effectively reduce your net profit.) You would need to report the home sale and potentially pay a capital gains tax on the $250,000 profit.

For the 2023 tax year, you are not subject to capital gains taxes if your taxable income is $44,625 or less ($89,250 if married and filing jointly). If it’s between $44,626 and $492,300 as a single filer, or between $89,251 and $553,850 if married and filing jointly, you would pay 15 percent on the $250,000 profit. Above those top amounts, the capital gains rate would be 20 percent.

However, the IRS gives home sellers multiple ways to avoid or reduce their capital gains taxes, principally if their property is a primary residence. You can exempt a certain amount of the profit — up to $250,000 or $500,000, depending on your filing status — from the tax if you meet certain conditions.

An ill-timed sale could result in a significant tax bill that could have otherwise been avoided.
— Greg McBride, Bankrate Chief Financial Analyst

“Before selling your home, familiarize yourself with the capital gains tax exclusion rules and consult a tax advisor,” says Greg McBride, Bankrate’s chief financial analyst. “An ill-timed sale could result in a significant tax bill that could have otherwise been avoided. If the property has been your primary residence for less than 24 months, for example, you may decide to hold off until you’ve reached that threshold to avoid capital gains tax.”

If you sell a house or property in one year or less after owning it, the short-term capital gains is taxed as ordinary income, which could be as high as 37 percent. Long-term capital gains for properties you owned for over a year are taxed at 0 percent, 15 percent or 20 percent depending on your income tax bracket.

How much is capital gains tax on a rental property?

A rental property doesn’t have the same exclusions as a primary residence when it comes to capital gains taxes. You would have to pay a 25 percent depreciation recapture tax on the portion of your profit from previously claimed depreciation and 0, 15 or 20 percent in long-term capital gains taxes, depending on your income and filing status on the balance.

Suppose the property you bought for $250,000 and sold for $500,000 was a rental. If your profit included depreciation you claimed as a business expense, the IRS would levy a 25 percent depreciation recapture tax on that amount. Your profit balance would be taxed at a 0, 15 or 20 percent capital gains rate, depending on your income.

If you plan to sell a rental property you’ve owned for less than a year, try to stretch ownership out to at least 12 months, or your profit will be taxed as ordinary income. The IRS doesn’t have a ceiling for short-term capital gains taxes, and you may be hit with up to 37 percent tax.

How to avoid capital gains tax on a home sale

Capital gains taxes can greatly affect your bottom line. Fortunately, there are ways to reduce or avoid capital gains taxes on a home sale altogether. It depends on the property type and your filing status. The IRS offers a few scenarios to avoid capital gains taxes when selling your house.

Bankrate insight

When does capital gains tax not apply? If you have lived in a home as your primary residence for two out of the five years preceding the home’s sale, the IRS lets you exempt $250,000 in profit, or $500,000 if married and filing jointly, from capital gains taxes. The two years do not necessarily need to be consecutive. If you become disabled, receive a job offer in a new area or are forced to sell your home before you have lived there two years, you may qualify for an exception to the two-out-of-five rule.

Avoiding capital gains tax on your primary residence

You can sell your primary residence and avoid paying capital gains taxes on the first $250,000 of your profits if your tax-filing status is single, and up to $500,000 if married and filing jointly. The exemption is only available once every two years. But it can, in effect, render the capital gains tax moot.

Let’s say a single filer bought a home for $250,000, lived in it for three years, and then sold it for $400,000. Their profit is $150,000. But that’s exempt from any capital gains tax because it’s under the $250,000 threshold allowed for gains.

Of course, there are conditions. To qualify as your primary residence, the IRS requires that you prove the property was your main home where you lived most of the time. You’ll need to show that you owned the home for at least two years and lived in the property as your primary residence for at least two of the five years immediately preceding the sale.

However, there is wiggle room in how the rules are interpreted. You don’t have to show you lived in the home the entire time you owned it or even consecutively for two years. You could, for example, purchase the house, live in it for 12 months, rent it out for a few years and then move in to establish primary residency for another 12 months. As long as you lived in the property as your primary residence for 24 months within the five years before the home’s sale, you can qualify for the capital gains tax exemption. And if you’re married and filing jointly, only one spouse needs to meet this requirement.

Avoiding capital gains tax on a rental or additional property

If you own an additional property that you plan to sell, you will need to plan to lower your tax liability. There are several ways to mitigate any capital gains tax:

Establish the rental as primary residence

You might find that an investment property you rent out and plan to sell has spiked in value. Moving into the rental for at least two years to convert it into a primary residence to avoid capital gains may be a good idea. However, you won’t be able to exclude the portion you depreciated while renting the property. You’ll lose primary residency status on your main home, too, but that can be regained later by moving back in after the sale of the rental property. If you don’t plan to sell the main home for at least two years, you can re-establish primary residency and qualify for the capital gains exclusion later.

1031 exchange

You can also take advantage of a 1031 exchange. Known as a like-kind exchange, it only works if you sell the investment property and use the proceeds to buy another similar property. If you keep putting the sale proceeds into another investment property, you can put off capital gains tax indefinitely.

Opportunity zones

The 2017 Tax Cuts and Jobs Act created opportunity zones — areas around the country identified as economically disadvantaged. If you choose to invest in a designated low-income community, you’ll get a step up in tax basis (your original cost) after the first five years. And any gains after 10 years will be tax-free.

Deduct expenses

If you still have capital gains after taking advantage of exemptions and exclusions, focus on lowering the amount of the taxable profit or gains. Some qualifying deductions include:

The cost of repairs to a home or investment property
Improvements and upgrades, such as adding a bedroom or renovating a kitchen

Losses in investment property income due to tenants unable to pay rent
Cost of legal, professional and advertising fees to evict a tenant or find a new one

Closing costs from the property sale

Remember to keep organized records and documents, including receipts, bills, invoices and credit card statements, to support your expense claims in case you’re audited.

FAQs

How much is capital gains tax on real estate?


The capital gains tax rate on the sale of a primary residence can be as high as 20 percent of the profit on a home owned for more than a year, and as high as 37 percent on one owned for a year or less. If you own and live in the home for two out of the five years before the sale, you will likely be exempt from any capital gains taxes up to $250,000 in profit, or $500,000 if married and filing jointly.

Is there a way to avoid capital gains tax on the selling of a house?


You will avoid capital gains tax if your profit on the sale is less than $250,000 (for single filers) or $500,000 (if you’re married and filing jointly), provided it has been your primary residence for at least two of the past five years. For investment properties, capital gains taxes can be deferred with a Section 1031 like-kind exchange, in which you use the profit from the sale of one investment property to buy another of equal or greater value.



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Buying and Selling a Home in California Is About to Change: Here’s How | KQED

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Previously, the buyer’s and seller’s agents would split the commission, but now, the buyer and seller will both be responsible for paying their respective agents.

“What the settlement does is [it] enables both the buyer and the seller to negotiate with the broker upfront of what level of service they want and what their fees are going to be,” said Ted Tozer, a fellow at the Urban Institute, who specializes in housing finance. “I think, in the long run, this is very positive.”

How will the world of real estate change? 

Likely, quite a bit.

Because commission rates can’t be set up front, realtors will have to compete for business and may offer lower rates to their clients. But it could also mean bad news for part-time realtors, who have otherwise relied on that 5%–6% commission as an occasional income.

“If you’re a realtor and you only sell a couple houses a month, you’re going to have a tough time making it,” Tozer said. “You will probably have less realtors in numbers, but the ones that are doing business are probably going to be more effective at what they’re doing because they’ll have to make it a full-time job.”

What does all this mean for me, a home buyer or seller? 

Firstly, because this is a class-action lawsuit, some home sellers might be entitled to compensation. But it doesn’t include California. It only pertains to metro areas in Arizona, Colorado, Florida, Nevada, North Carolina, Ohio, Texas, Utah, Minnesota, Pennsylvania, Virginia and Washington, D.C.

That said, the proposed settlement will likely empower home buyers and sellers to negotiate the commission rate with their agents.

“What the lawsuit was all about was that the sellers felt like they should have more control,” Tozer said. “I should have the ability to have a say in what I’m paying.”





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