By Danica Ro
Image: Chris Snook
Even the happiest of homeowners sometimes find themselves wishing for a better option. When you spend hours each week maintaining a sprawling lawn or have to trip through a living room littered with the kids’ toys, it’s easy to dream of listing your current property and purchasing a new home.
When the idea to list their home starts to become serious, many people find that the decision is much harder than they anticipated. Listing a home (and subsequently finding a new property) is a hefty commitment of time and money. And, you know, a little thing called ‘stress’.
How can you know if you’re ready to list your home? We’ve laid out a few key points to help you understand your situation and make a confident decision.
Image: American Artisans Designers & Fabricators
Does your home fit your needs?
As time goes on, our lives change. In a perfect world, the homes we love would grow and change with us in order to fit our lifestyles; a new addition to the family, a longer commute to a relocated office, or an elderly-friendly space for an aging parent. Unfortunately, the ability to morph our homes so greatly is rarely the case.
And so, one of the biggest signs that you’re ready to sell your home is if it no longer suits your needs. After all, who wants the headache of constantly retrofitting a space when you could find one that already fits your family comfortably?
Making a pro and con list of your home’s features is an easy way to see if your needs are being met. Start with the big-ticket items — a lack of necessary bedrooms or a larger kitchen, and work your way down to the more trivial points.
When you’re finished, you should be able to see very clearly whether it makes more sense to sell your home or to stay put.
Image: Terrrat Elms Interior Design
Do you know your home’s current market value?
The real estate market is constantly fluctuating, which can be a hard truth for sellers to accept. Your home’s sale price in the current market may not match the price at which you bought the property.
Obviously, this can be a good thing if the market is stronger now than when you first purchased. But, if you mortgaged the property at a high sale price and now need to pay off that mortgage when values are low, selling your home can become a bit more difficult.
Contact a real estate agent to determine your home’s current value. After taking a thorough look at the property, he or she will generate a Comparative Market Analysis for you. This report takes your home’s condition, upgrades, size, and location into account and compares it to similar properties that have recently sold in order to give you a fair price point.
If you find that sale prices have decreased drastically but you’re desperate to move, consider doing some upgrades. Assets such as a remodeled kitchen, a finished basement, or a central air system are all taken into account when judging a home’s sale price.
Image: Feldman Architecture
Are you financially capable?
Potential sellers often assume that since the buyers are the ones purchasing the property, they are the only ones making a commitment. This is not the case. While the sellers’ financial responsibility in the transaction may not be as large, there is a cost. Before deciding to sell, make sure you have the ability to make payments, if necessary.
Verify that you will be able to pay off your mortgage at the current sale price. Make sure you will have enough money left over after settlement to cover your new living arrangements. Set aside a lump sum to pay for any necessary repairs after inspections and leave a little extra for unanticipated costs that can and will pop up along the way.
However, sometimes the decision to sell your home is a step towards financial security. If you are putting your home on the market to avoid foreclosure or bankruptcy, your concerns are a bit different.
You’ll want to contact a real estate agent who specializes in short sales: a type of transaction where the bank agrees to forgo some of the money owed on a mortgage to keep the owner from defaulting on a loan entirely. Make sure to list your property “as-is” when marketing it, so potential buyers know you won’t be making repairs. Be honest about any financial changes throughout the course of your transaction.
Image: Murphy Co. Design
Have you made the repairs on your to-do list?
Every home has a never-ending to-do list of chores and improvements. When you need to decide whether or not you’re ready to list, it’s time to start checking items off.
These small fixes could help make your decision easier. Once you’ve finished the list, ask yourself whether they have improved your overall opinion of your home. If so, has it improved it enough to convince you to stay?
Even if the answer is no, making these small household improvements will work to your advantage. An improved condition could mean an increase in property value. Additionally, since buyers inspect the property and take necessary repairs into account during contract negotiations, making the repairs ahead of time will put you in a stronger bargaining position.
Image: Clean Design
Do you have a plan for the future?
This may sound obvious, but it’s important enough to bear repeating. It’s easy for potential sellers to be swayed by the prospect of being given hundreds of thousands of dollars for their current property. That is because they don’t always put enough thought into what they’d like in a new home and the associated costs. Before listing your property, take the time to think about your next step.
Think about factors such as location, property size, the amount of maintenance you’d like to perform, and financial concerns like property values and yearly taxes. If you have a growing family, you may want to research the quality of the school districts before settling on a location. For those concerned about maintenance-free living, consider a condo or townhome community rather than a single-family property.
Start planning by having a discussion with your family members about what qualities are important in a new home. Take time to look at properties online to get a feel for your likes and dislikes. Once you have a specific area in mind, spend some time there to get a sense of the community. If you like what you find, contact a real estate agent to help get you ready for the next step.
When deciding whether or not to list your home, there is no right answer. Use these points as a starting guide for how to determine if you’re ready to sell. Whether you end up selling or staying just make sure that you are comfortable and secure in your final decision.
When did you know you were ready to sell your home? Or, what made you decide to stay? Let us know in the comments below, or reach out to us on social media.