How to Get More Money Out of Your Home Sale
If you are thinking of selling your house, you obviously want to get the best financial returns from your home sale. How much you can get out of it may depend on your ownership situation (i.e., what you owe on your mortgage vs. what you have built up in equity), as well as your reasons for selling.
Some homeowners are in a great position to sell their houses. They have built up good home equity, made all their mortgage payments and have lived in the home long enough to owe less on the house than what it is worth. Other homeowners may have inherited a property outright, bought with cash or have it fully paid off after many years of making mortgage payments.
In these situations above, you are generally going to be in very good shape to sell your house for a nice profit. How you opt to sell your property is up to you, and we will get into those options a little later in the article.
Other homeowners may find themselves in situations that are less favorable. You may be in a position of financial distress that has left you behind on mortgage payments or property taxes. You are worried about losing your home and you are wanting to sell now to get out from under the growing debt. Even if you are above water for now (meaning you still owe less than the house is worth), the writing may be on the wall and it could be a good time to sell before you get to a point where you are upside-down on your mortgage. This is a common scenario right now with many homeowners on mortgage forbearance plans that will eventually end.
Depending on your situation, here are some different tips from PropertyLark that will help you get more money out of your upcoming home sale:
Get it Ready for the Market
If you are going to sell your house on the open market (usually through a real estate agent for the highest possible resale price), you are going to want to get it ready. You want it to be as appealing as possible for potential buyers. This means making necessary repairs, cleaning up (decluttering), and maybe even adding a fresh coat of paint or new flooring. You can make upgrades and repairs—as well as hire a professional home stager—to present the house in its best light. Buyers are simply willing to pay more for a property that looks good and isn’t in need of any major repairs.
Hire a Real Estate Agent
You can try to sell the house yourself (For Sale By Owner) to save money on agent commissions and some other closing costs, but you likely won’t get the same kind of offers as you will when listing the property on the Multiple Listing Service (MLS) and having a professional real estate agent/brokerage extensively marketing the home sale. An open market listing will attract more buyers (and more serious, qualified buyers) and you will have more negotiating power with an experienced agent on your side. You may be paying extra for their services, but you will typically get a better selling price in the end to more than make up for it.
Take Your Time
A successful home sale on the open market takes time. You need to take time to prepare the property as noted in Tip #1 and then it will take time to list it, market it and show it to buyers before offers start rolling in. Even then, you aren’t likely going to accept the first offer you get, so you want to take your time to review the purchase offers and make a financial decision that benefits you most in the end. The average home sale will take 3-6 months from initial planning to final closing.
Explore All Your Options
Remember that an open market sale through a Realtor® is not your only home selling option. There are other ways to sell your property and make a healthy profit. This is where your personal finances or ownership situation may also make an impact. More and more home sellers are opting to accept cash offers from real estate investors or work out creative financing options if they have enough leverage. Though a cash sale may not bring a selling price that’s as high as an open market sale, it may still net you the best return. You won’t be paying all the closing costs. You won’t be paying agent and brokerage commissions (including those of the buyer’s agent/broker, as well).
Time is another factor to consider. Some homeowners are in situations where they want or need to sell quickly. Divorces, job relocations, pre-foreclosures, tax defaults, unwanted inherited properties, etc.—these are all scenarios that may drive you to sell as soon as possible with fewer complexities. Remember, if your house takes 3-6 months to sell, that’s 3-6 more months of mortgage payments, property taxes, HOA dues (if applicable), utilities and other home ownership expenses. A cash sale or other seller financing solution can typically be completed within weeks, not months. Real estate investors will also usually buy houses in as-is condition, so you may also be able to save money if it needs significant repairs.
Whether you decide to sell on the open market in a traditional home sale or you opt for a quicker and easier sale/lease to a real estate investor, it’s important to explore all your options. Run the numbers and see which plan will net you the most money in the end. You might be surprised at how the figures shake out. In most cases, a traditional sale through an agent will give you the best return on investment, but it may not be the best solution for you.
If you are thinking of selling your home, you can get a no-obligation cash offer from PropertyLark within 24 hours. Just fill out the contact form on any page of our website. You can at least know what a cash investor is willing to offer. If that isn’t of interest to you, we can help you explore all of your different selling or financing solutions. We do more than just buy houses for cash. We are a complete home selling company and we can help you get the most out of your home sale.