3 Steps to Take Before You Sell Your Home This Year
Ready to sell your home? Make sure to check these key items off your list.
While 2021 may be a tricky time to buy a home, it's a great time to sell one. Low mortgage rates have caused a surge in buyer demand, and many people are clamoring to purchase homes. Throw in the fact that property values have soared, and you may be in a prime position to command a sweet price for your home.
Before you get ready to list your home, there are certain steps worth taking. Here are a few essential ones to tackle.
1. See how much competition there is in your neighborhood
A big reason why sellers are getting away with charging so much for their homes is that there aren't a lot of properties on the market to choose from. In fact, on a national level, the U.S. housing market is short over 5 million homes to meet buyer demand.
But just because there's not much competition in general doesn't mean that's reflective of your specific neighborhood. If there happens to be a number of comparable homes for sale within a one-mile radius of where you live, you may want to hold off on listing your home for a bit. The less competition you have, the easier it'll be to not only sell your home, but get the price you want for it.
2. Fix minor cosmetic issues before selling your home
Gutting your kitchen or finishing your basement may not make sense if you're about to sell your home. Sure, those renovations might score you a higher sale price, but they're also quite expensive and time consuming.
But if there's one step it does pay to take before selling your home, it's making cosmetic touch-ups so buyers get a good impression of your space. That could mean steam-cleaning some carpets, giving your bedrooms a fresh coat of paint, or fixing nail pops or other innocent eyesores.
3. Make sure it makes financial sense to sell your home
Once you sell your home, you'll need a place to live. That could mean finding a rental and waiting to buy until home prices come down. Or it could mean upsizing to a larger home, downsizing to a smaller home, or finding a comparably sized home in a different neighborhood.
Either way, run the numbers to make sure your plans make sense financially. If your goal in selling this year is to make a big profit, you don't want to wipe that profit out by moving to an area where you have to overpay for a house yourself.
At the same time, if you're buying a new home in conjunction with selling yours, make sure you're in a good position to qualify for a mortgage. Having a down payment from the proceeds of the sale of your home won't guarantee you a home loan. If your credit score is poor and you have a lot of existing debt, you may be denied a mortgage despite having plenty of funds to put down at closing. Check your credit score as well as your credit report, and address any other financial red flags that might cause a lender to deny your home loan application. Don't be afraid to shop around to find the best mortgage lenders.
It's fair to say that now's a good time to sell your home. Just make sure to check off these items before moving forward.
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