Sellers

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There are a lot of mistakes sellers can get into when they put up their house for sale. There was a seller in Virginia who had a half bath that was originally placed at the front of his house. He thought that it would be better if it was moved to the back of the main level. All the other similar models had the powder room in the same place for the past 20 years. It cost him thousands of dollars to move it, thinking it will get his house off the market sooner, but it didn’t. It became an expensive mistake.

Sid Davis, a real estate broker and author of “A Survival Guide to Selling a Home,” points out seven costly mistakes that sellers often make with regards to selling their home. In my business, I’ve seen each one of these mistakes played out and it just makes me shake my head as to why, sellers forge ahead with unwise strategies, instead of listening to the voice of an experienced professional, he says.

Sid Davis, real estate broker and author of the book “A Survival Guide to Selling a Home,” points out seven costly mistkaes that sellers make with regards to selling their home. In my business, I’ve seen each one of these mistakes played out and it just makes me shake my head as to why, sellers forge ahead with unwise strategies, instead of listening to the voice of an experienced professional, he said.

• Mistake 1: Putting your home on the market before it’s ready. This usually happens because the seller is in a hurry to sell the house or the seller did not prepare early. And so, repainting is done while the house is shown. Or possible buyers view the house with a carpet that obviously needs to be replaced already. Presentation is vital. Prepare the home before putting it up for sale.
• Mistake 2: Over-improving the house for the neighborhood. Don’t make additions, bump-outs and upgrades that will make the house stand out from among its competition in a way that it becomes an anomaly rather than a good addition to the community.
• Mistake 3: Pricing the home based on what the seller wants to earn net. This is a bad pricing motivation. The sale price is dependent on the market climate and not on what the seller wants. Sellers can control the asking price but not the sales price.
• Mistake 4: Choosing an agent based on non-business factors. If you want to sell your house fast and with good terms, choose an agent because of their good track record, not because they’re your relative or friend.
• Mistake 5: Getting emotionallhy involved in the sale of the house. This is one of the biggest challenges that sellers face. When you decide to sell your home, you’ll need to think of your home as a commodity – prepare it as a commodity, market it as a commodity, and price it as a commodity. Many potential buyers will go to your house and scrutinize it. Don’t feel bad, they are only judging it based on their preferences.
• Mistake 6: Covering up or not disclosing problems. Most states have a property disclosure/disclaimer form. You can be sued for a leaky basement or wiring problems discovered 30 days after settlement.
• Mistake 7: Not getting your ducks lined up before you sell. This means getting your financing ready, making sure there’s no pre-payment penalties on your mortgage, monitoring your local market. If according to local market, you sell first before buying or vice vers, do the same.

Don’t fear making these mistakes. There are actually things you can do to avoid them. Learn from professionals who made resources like this for you to learn from.

If you want to sell your home in the soonest time at a good price, you need to make your house look attractive and interesting to buyers. Here are twenty sure-fire tips to do this:

Preparation

• The first thing you need to take care of is the outside since this is the first thing that potential buyers see. The lawn must be trimmed and free from clutter. Walks and s]teps should be clean from ice, snow and debris. The fron door needs to be clean and make the entry look inviting.
• Faded paint and worn out wood makes your house look old and cheap. Spending on a new wallpaper will be worth your money. Take time and effort to redecorate your house and you’ll sell your house at a good price.
• Bright and sunny rooms add to the charm. So open the curtains and let the sun shine in. It’s cost free but can do a lot of wonders.
• Do all the necessary repairs – Loose knobs, sticking doors and windows, warped cabinet drawers and other minor.
• Make your attic basement, and other utility space look bigger by removing storage bins. Painting the walls with a light color can brighten the mood and make them look more spacious.
• Ensure safety. Take away any clutter that can cause injury, especially in the stairs.
• Make closets, cabinets, shelves and cupboards look spacious by arranging things neatly.
• Bathrooms should look clean and bright. And the faucets should be working.
• Make the bedrooms look neat, beautiful and relaxing. Use attractive bedspreads and newly washed curtains.
• Make sure all the lights in the house are working. Turn on all the lights for an evening tour. It will give potential buyers a feel of glowing warmth.

Showing

• Avoid having too many people in the house during house tours or inspection. This will make the buyer feel like an intruder.
• Music helps. But make sure it’s soft and mellow. The agent should be able to converse easily with the buyers.
• If you have pets, make sure they are not in the way.
• Be polite and accomodating but don’t force conversation. Maybe the buyer needs space to think or just take everything in.
• Never apologize for the appearance of your home. Leave it to your agent to answer inquiries or objections.
• Just stay in the sidelines. Your agent is trained and experienced in doing this. They will know how to emphasize the positive features of your house. And allow your agent to discuss price, terms, possession and other petinent factors. They are qualified to bring negotiations to a favorable conclusion.
• Don’t dispose of furniture and furnishings before a buyer has bought the house.
• Show your home to prospective buyers only by appointment through your agent. They could handle the tour better as professionals and can sell your house more quickly.

When you sell your home, especially at a time when your taxes are due, you could get financial shelter. Thanks to The Taxpayer Relief Act of 1997, the real estate sector can receive what is considered the best tax shelter through their homes.

According to the federal tax law, when you sell your home, you can keep, tax free, capital gains of up to $500,000 if you are married filing jointly or $250,000 for single taxpayers, or married taxpayers who file separately.

To qualify for the $250,000/$500,000 exclusion, you must have lived in the house (as your primary residence) for at least two of the prior five years. The best part is, it’s not a one-time benefit. You can use this benefit as often as you qualify – every two years, to fulfill the owner-occupied-two-out-of-five-years requirement.

For example, if you have two homes and you live in one of them for two years, sell it and live in the other one for another two years and sell them both, both qualify for the exclusion. If due to some unforeseen reasons like a job change, illness, death of a spouse, divorce, disaster, war or some other hardship, you are forced to sell before you meet the two-year residency requirement, there are special provisions. In these cases, the $500,000/$250,000 exclusion (not your specific gain) will be prorated. For example, if after only a year of living in your house you are forced to sell it because of a qualified unforeseen reason, you can exclude from taxes up to $250,000 (half the exclusion) in capital gains if you are married and file jointly or $125,000 for separate and single filers.

One unforeseen event where homeowners were able to use the provision was during the September 11, 2001 acts of terrorism in New York, Pennsylvania and Washington, D.C.. Sellers were able to prorate the exclusions given these conditions:

• A spouse, home co-owner, or person living with the taxpayer was killed by the attacks.
• The taxpayer’s principal residence was damaged.
• The taxpayer or a person listed in (1) became eligible for unemployment compensation, or
• The taxpayer or a person listed in (1) had a change in employment or self-employment that resulted in the taxpayer’s inability to pay reasonable basic living expenses for the household.

Selling costs
If later, after you sell, you realize there’s still a taxable profit after the exclusion, you can bring down your gain with selling costs. Your gain refers to your home’s selling price, minus deductible closing costs, minus your basis. Your basis is the original purchase price, plus capital improvements, minus any depreciation.

Selling costs also include real estate broker’s commissions, title insurance, legal fees, administrative costs and inspection fees. It can also include repairs or additions completed within 90 days of your sale to make the house more marketable.

Moving costs
If you need to move and sell your home because of a new job, you can deduct part of the moving costs. These are the requirements that need to be met:

• Your new job must be at least 50 miles from the old;
• you must work full time at the new work place for 39 of the 52 weeks after the move;

The exclusion could also include costs for travel, transportation, lodging and storage.

If you are self-employed, you can be eligible for tax deductions if you work full-time for at least 39 weeks during the first 12 months and a total of 78 weeks during the first 24 months after arriving at the new job location.

To get more information about home selling-related tax benefits, get in touch with tax professional and state and local tax authorities in your area.