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Planning to sell your home this year? Here are some items to check off your list first.
Key points
- So far, 2022 is shaping up to be a good year to sell a home.
- Before you list yours, you’ll need to do some number-crunching and make some key decisions.
If you’ve been thinking about selling your home for quite some time, you may be gearing up to take that leap in 2022. And to be clear, that’s a decision that could work out well for you financially.
Right now, home prices are up on a national level, and buyer demand is still very high thanks to relatively low mortgage rates. If you sell your home this year, you might get a great price for it — especially if housing inventory remains sluggish, as has been the case for a year and counting.
But before you sell your home, there are a few important items you’ll need to tackle. Check these off your list prior to listing your property.
1. Make sure you can afford to buy a replacement home
The fact that home prices are up right now is great for sellers and not so great for buyers. But if you’re planning to sell your home and buy a new one, what you gain via a higher sales price, you might lose when paying for a replacement home.
In fact, if you’re planning to sell your home and upsize, you’ll need to run some numbers and make sure you can afford the type of home you’re hoping for. First, see what comparable homes in your area are selling for. That should give you a general idea as to what price your property might command. Then, see how much you owe on your mortgage. That should help you figure out what down payment you can bring to the table for a new home.
From there, research home prices in the area you want to move to. Then, compare those prices to your down payment and budget and see what works financially. You may realize that despite getting more money for your existing home, a much larger one is out of reach right now. Or, you might find that you can buy that larger home, but in a different zip code than the one you were initially targeting.
2. Decide if you’ll sell your home yourself or hire an agent
There are many benefits to using a real estate agent to sell your home, like getting an expert to help stage and market your property and having a professional help you navigate your offers. Plus, a real estate agent could help you price your home just right.
But there’s a downside to using a real estate agent: having to pay a fee. That fee could easily amount to 5% of your home’s sale price. If you sell your home for $400,000, it could mean losing $20,000 to an agent.
Since the demand for homes is high right now, you may not need to hire a real estate agent to sell your property quickly and at a price you’re happy with. But not hiring an agent also means having to do more legwork yourself. Be sure to weigh the pros and cons before making that call.
3. Map out a home repair budget
Since buyers are clamoring for homes these days, you don’t necessarily need to present a perfect-looking property to get an offer. But it does pay to make smaller fixes that might otherwise result in a lower sale price or turn potential buyers away.
Before you sell your home, go through room by room and make a list of glaring issues, like stained carpeting, peeling paint, and plumbing fixtures that don’t work. Then, figure out what it will cost to address those issues before listing your home. If you can’t afford to fix everything on your list, focus on the items you think will have the most impact.
Selling a home is a big move — one you should put plenty of thought into. Be sure to tackle these key items before putting your home on the market in 2022.
A historic opportunity to potentially save thousands on your mortgage
Chances are, interest rates won’t stay put at multi-decade lows for much longer. That’s why taking action today is crucial, whether you’re wanting to refinance and cut your mortgage payment or you’re ready to pull the trigger on a new home purchase.
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