This Financial Guide gives you suggestions that can increase the sales
price and reduce the frustrations involved in selling a home. It discusses
how to find a good agent, how to make your home more attractive to buyers,
how to negotiate effectively, and how to handle the moving process.

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Here are some tips for getting the best possible price for your home and
making the process as smooth as possible. By putting some time into choosing
a real estate agent, for instance, you can avoid wasting unnecessary time on
the market due to an ineffective or haphazard sales strategy. Further, there
are actions you can take to make your home more saleable.

Finding A Good Real Estate Agent

To find a good real estate agent, gather a list of names of candidates you
will interview. You may want to consider recommendations from colleagues,
friends, and professionals, as well as names listed on posted “for sale”
signs, especially for houses that have been sold. Once you have at least
three names, schedule a telephone or in-person interview with the agent. You
may encounter some resistance; if you run into a broker who refuses to take
the time to answer your questions, just move to the next one.

Tip Tip: Although a popular practice in recent times
(due to the savings on commissions paid to a broker), selling your own
home without a broker is often more difficult unless you have a buyer in

Be sure to ask potential agents the following:

  • What problems do you see in marketing our home? (The broker
    should be honest about potential problems in selling the home and able to
    think creatively about solutions.)

  • What would your plan be for marketing our home? What can we do to
    help you implement your plan?
    Listen carefully to the answer to find out
    whether the agent exhibits a willingness to think creatively in
    approaching whatever problems might exist with the selling process and
    whether he or she has a cooperative attitude.

  • Will you include any ideas you have for selling the home in a
    listing agreement if we decide to sign with you?

  • Where do you live? (You want a broker who lives nearby, who
    knows the good and bad points about your area.)

  • How much is your commission? (The average commission is 6 or
    7 percent. Although brokers sometimes take a cut in their commissions during the
    negotiation process in order to move a sale along there is no point in
    trying to bargain down a broker’s commission at this point.)

  • Do you have a list of comparable homes? (Such a list is
    essential in helping you arrive at an asking price for your home.)

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Reviewing The Listing Agreement

The listing agreement is a contract between the homeowners and the agent.
It states how much the agent will be paid and what services will be

An exclusive right-to-sell type of agreement gives the broker the
exclusive right to sell your house for a limited period of time. Other types
of listing agreements vary either the exclusivity or time period of the
listing. No matter which of these agreements are signed, the listing agent
gets 100 percent of the commission if he or she sells the house and part of the
commission if another broker sells the house.

Tip Tip: Generally, try to limit an
exclusive-right-to-sell agreement to a period of three months. This
agreement will give the broker an incentive to sell the home, and it will
still give you an out if you feel the broker is not doing enough for you.
If you have substantial confidence in the broker, and you have seen and
approved his or her plans for marketing the home, you may wish to sign a
six month contract.
Tip Tip: If, at any time during the marketing
process, you feel that your broker is not as effective as he or she could
be, switch brokers. Do not waste time with a broker you have doubts

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Up The Selling Process

There are various things you can do before and during the selling process
to move it along and make it less onerous. A good real estate agent may
suggest the following:

  • Make cosmetic improvements to get the house looking as good as
    For instance, patch damaged plaster and drywall, repaint,
    and re-wallpaper. Spruce up the exterior by replacing broken shingles or
    shutters or doing some minor landscaping to give your home more “curb

  • Increase your home’s appeal to a wider range of potential
    Repair or replace any part of your home that’s been modified
    that might not appeal to the general population.

  • Make your home cozy and inviting when potentials buyers come
    Make sure the interior and exterior are clean, neat, and well
    maintained. Have a fire burning in the fireplace, bake some cookies or an
    apple pie, or have a pot of coffee brewing. Put away toys and tools. Keep
    pets out of sight. Not everyone is as enamored of Fido as your family is.
    Try not to cook foods like fish with lingering odors.

  • Here are some ideas for working with your broker to speed up the sale
    of your home.

  • Offer a warranty. Sometimes offering a warranty on the roof,
    electrical system or appliances can speed up a sale or smooth the
    negotiating process, particularly if it’s causing buyers to balk at the
    asking price.

  • Create a home sale kit with your broker. A home sale kit
    consists of flyers that are distributed to potential home buyers and
    contain photos of your home’s exterior, interior, and surroundings. The
    sales flyer should also list major selling points and include information about
    utility costs, taxes, and a floor plan.

  • Do not help the broker show the home. Allow the broker to do
    his or her job. Make yourself available for questions, but do not try to
    help sell to potential buyers who are looking at your home.

  • Offer a bonus to your broker. A bonus shouldn’t be obvious to
    the buyer because the buyer will wonder if the house price has been
    bumped up to accommodate the real estate broker’s bonus. Instead, offer
    the bonus in the form of an increased commission, say 3.5 percent
    instead of 3 percent.

  • Take it off the market and re-list it later. If your house has
    been on the market for a long time, it may be perceived as undesirable.
    Taking it off the market and re-listing it at a later time sometimes

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Negotiating Effectively

Although it is the broker’s job to do the actual negotiating, the homeowners should stay involved in the process. Here are some tips for negotiating with buyers, once they have made their first offer.

  • Find out as much as possible about the potential buyer. Try to find
    out, for example, whether the buyer needs to buy a home quickly or is in a
    position to take plenty of time to negotiate. This will help you to decide
    what type of negotiating stance to take. Knowing details about the buyer’s
    family will help you point out how your home accommodates their needs. And,
    if you know that a buyer lives in an apartment and will need to buy
    appliances for their new home, then you can throw in deal sweeteners such
    as refrigerators, washer and dryers, and furnishings.
  • On the flip side, try to reveal as little as possible about your own

One final piece of advice is to avoid being confrontational, which can
kill a potential deal during the negotiation process. The offers you receive
will likely be 10 to 15 percent below your asking price. Do not be offended by this
or by any “low-balling” techniques engaged in by buyers. Be willing to make
some concessions. Make counter-offers and try to bring the offer closer to
your asking price. If you feel that an offer is unreasonable, however, you
can always reject it outright and wait for another buyer.

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Your Move

Once you have signed the contracts, it is time to start planning the move.
The closing date, which is generally your moving date, will fall about two
months after the contracts are signed.

Hiring A Moving Company

One thing you should do immediately after the contracts are signed even
though your moving date may be months away is to begin calling moving
companies. Try to get recommendations from friends or colleagues. Call a
number of movers for estimates. You will have to provide them with the number
of miles involved in the move and the approximate weight of your belongings.
The mover will help you in making this estimate. Do not use a mover whose
estimate seems too low. The services provided may be second-rate. You get
what you pay for!

Ask in advance about extra charges for heavy items, stairways, or pianos.
Be aware that having the movers pack for you will increase your moving bill
by about 30 percent. Also, you may pay a premium if you schedule your move during
busy moving times, generally after the 25th of the month or before the

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Ready For the Move

Right after you have scheduled your move, start taking care of the
following items:

  • Start throwing away things you don’t want to bring with you.
  • Decide which items you are leaving behind for the new owners, and tag
    them appropriately.
  • If your move is job-related, ask whether your employer will reimburse
    you for part of the cost. Save any receipts relating to the move, since
    part of the cost will be deductible.
  • Start shopping for a new bank in your new neighborhood. Open a checking
    account once you have found one with competitive fees and convenient
  • Get a change of address kit from the post office, and start notifying
    everyone of your impending change. Note that you will need to follow any instructions given by credit card companies, banks, and other institutions that are affected by a
    change of address; sending them a change-of-address card will generally not
    be effective.
  • Call the schools in the new area to enroll your children.
  • Obtain enough packing supplies from your mover, and begin packing,
    unless the mover will be doing the packing for you.
  • Get copies of your medical and dental records (and veterinary records),
    so you can hand these to your new doctors after you move.
  • Be sure your move is covered by insurance: either the moving company’s
    insurance or your homeowner’s insurance. Call your insurance company to
    determine whether the move is covered. Also, take care of transferring your
    homeowner’s insurance to the new home.

Then, as you get closer to the date of your move, take care of the

  • Call the utility companies and tell them to turn on service in the new
    place. Schedule a date when they will terminate service in the old
  • Pack your belongings in boxes. Mark each box with its intended location
    in the new home, and with a summary of its contents. When you are close to
    moving day, pack a separate bag with items you will need right away, such
    as medications, toiletries, and clothing.
  • Switch your direct payroll deposit, and any automatic payments, to your
    new checking account. You will have to fill out a form to accomplish this.
    Two or three days before you move, take the money out of your old account
    and transfer it to your new account.
Tip Tip: Leave the old account open until all
outstanding checks have cleared. To avoid fees, you may need to leave in
any minimum balance required. Be sure to leave your new address with the
old bank.
  • If you are moving into an apartment building, discuss your moving plans
    with the landlord and make any necessary arrangements.
  • Shop for auto insurance in the new area (if moving out of state).
  • Confirm with the moving company. Write down directions to your new
  • Transfer your brokerage account to your new area.
  • Take valuables out of a safe deposit box and return the keys to the
  • Obtain travelers’ checks to cover the expenses of your move, and a
    cashier’s check to pay the mover (unless they will accept a personal
  • Defrost your refrigerator.
  • Leave a mail-forwarding order with the Post Office.
  • On moving day, check your contract with the mover. Be sure the total
    cost of the move is clearly detailed. Make sure the moving date, location,
    and insurance information are correct.

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Notifying People Of Your Move

Here is a list of people you should notify when you change your address
and phone number. Although the list is not all-inclusive, it can be used as a
starting point. You may need to notify these parties at both your old and new
locations. Bear in mind that you may need to follow the instructions provided
by banks, utilities, and credit card companies in order to effectively change your address. For instance, a phoned-in address change may not become effective with a lender if the lender’s policy is to require written address changes.

  • The IRS (use Form 8822) and state and local taxing authorities
  • The U.S. Post Office
  • Home, auto, and life Insurance agents
  • Debtors and creditors, such as mortgage holders, car lien holders,
    other lenders, and people who owe you money
  • Credit card companies
  • Publications
  • Clubs and services to which you subscribe such as auto clubs, lawn
    mowing services, cleaning services, and book clubs
  • The Social Security Administration
  • Any organization that periodically mails you a check, such as a pension
    check or veterans’ benefits
  • Banks
  • Employers
  • Doctors, dentists, veterinarians
  • Motor vehicle departments
  • Places of worship and non-profit agencies you are involved with
  • The registrar of voters
  • Utilities, telephone service, answering service, and trash
  • Your professional advisors

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The Tax

Your responsibilities do not end with the sale of the old home and the
move to the new one. There are tax consequences, often complex, that need to
be considered. How much is the gain? How much of it is taxable? How can you
minimize the tax impact? Here, professional guidance is important.

Related Guide Related Guide: To gain a better understanding of
the tax consequences, please see the Financial Guide:
SELLING YOUR HOME: How To Minimize The Tax On The Gain

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Titles and What They Mean

When looking for a real estate agent, you may come across the following
commonly used titles. Here is a basic definition of each:

  • Principal broker: This is a person who is licensed to operate a
    real estate office. He or she may either work alone or employ other
    agents. Several years of experience are required to obtain this
    licensure. Anyone selling real estate must work under the supervision of a
    principal broker.

  • Realtor: A realtor is a member of the National Association of
    Realtors, along with a state realtors’ association and a local board of
    realtors. Realtors are bound by a code of ethics. They are able to access
    a local computerized database of homes for sale known as the multiple
    listing service (MLS).

  • Agent: This is the general term for any licensed professional
    in the real estate sales business.

  • Listing agent: A type of agent who signs up the home seller and
    lists the home with the multiple listing service.

  • Selling agent: An agent who finds a home for sale (through the
    multiple listing service) and finds a buyer for it.

  • Buyer’s agent: The buyer’s agent is employed by the broker
    selected by the buyer.

Note Note: On a home sale, the listing agent and the
selling agent split the commission with each other and with their
principal brokers.

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Improvements That Help The Most

The following improvements and additions may increase the resale value of
your home. Of course, bear in mind that the value home buyers place on
various improvements will vary regionally, and even from neighborhood to
neighborhood. But the list might serve to give you some ideas.

  • Family room
  • Fireplace
  • Dining room
  • Linen closet
  • Garbage disposal
  • Wall-to-wall carpeting
  • Smoke detector
  • Two-sink vanity (bathroom)
  • Double-glass windows
  • Range hood and fan
  • Bathroom dressing area
  • Patio
  • New, stronger locks
  • Central air
  • Guest room
  • Bathroom exhaust fan

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