11 Tips for Selling Your Home in 2021
Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It may not have been previewed, commissioned or otherwise endorsed by any of our network partners.
If selling your home is on your agenda for 2021, you’re in luck. In many housing markets, buyer demand is high and housing inventory is low. But even though it’s a seller’s market in many areas, you’ll still want to be prepared for home sale changes due to the COVID-19 pandemic and other local market conditions.
Here are 11 tips for selling your home in 2021, along with some advice on mistakes to avoid.
- 1. Hire a real estate agent
- 2. Get a pre-sale home inspection
- 3. Avoid costly renovations beyond needed repairs
- 4. Set a selling timeline
- 5. Price your home right
- 6. Declutter and prep your home to go on the market
- 7. Market your home with virtual tours, professional photos
- 8. Make a plan for handling showings
- 9. Evaluate and negotiate offers
- 10. Tally up your seller closing costs
- 11. Close on your home sale
- 5 mistakes to avoid when selling your home
1. Hire a real estate agent
Selling your home without a real estate agent may be tempting, but it’s probably not worth it. The coronavirus pandemic has changed the home-selling landscape — an experienced agent can help you market your home in this new environment, and ensure your home is priced appropriately.
Speak to at least three different real estate agents to understand your local market and get an idea of your home’s current market value.
2. Get a pre-sale home inspection
Many home sales include a home inspection contingency on the buyer’s side. One way to avoid surprises is to get a pre-sale home inspection. A home inspector will look at the home’s major systems and make recommendations if there are defects that need to be addressed ASAP. An inspection costs $300 to $500, but that’s a small price to pay to avoid a sale falling through.
3. Avoid costly renovations beyond needed repairs
Based on your pre-sale home inspection, consider completing needed repairs. While it might be tempting to renovate your kitchen and bathroom, the cost may not be worthwhile. According to Remodeling’s 2020 Cost Versus Value Report, you won’t recover your costs from many common remodeling projects. For example, a midrange bathroom remodel costs an average of $21,377, but the resale value of the remodel was $13,688 — recouping just 64% of what was spent.
A renovation also takes valuable time. Given the seller’s market in most areas, it’s a better bet to repair essentials, like a water heater that’s on its last leg, rather than putting money into renovations. There’s a good chance someone will buy it as-is.
4. Set a selling timeline
Be realistic about when you’ll be ready to close if a buyer makes an offer you can’t refuse.
Maybe you need to sell your home fast because of a job change or divorce. Or you might need extra time to buy a house because your current one hasn’t yet sold. Make sure you know the average time to close on a house in your area and set a feasible closing timeline.
5. Price your home right
Sellers want to get the best price for their home, but overpricing it can make your home languish on the market. Your real estate agent can provide you with a comparative market analysis (CMA) to come up with an asking price that’s in line with what similar homes nearby have sold for. You’ll be able to take a close look at the features of homes in the report and determine how your home compares based on its condition, layout and size.
As you’re deciding on an asking price, fill out the seller disclosure form. This document is required by law in most states, and sellers must reveal any known material defects with their homes. You may decide to adjust your sales price based on known issues.
6. Declutter and prep your home to go on the market
Before selling your house, you have to make it stand out from the crowd. Here’s a list of ways to prep it for sale:
- Stage your home. Professional staging can help your home sell more quickly and for more money, according to NAR. The cost of staging ranges from $523 to $2,005, according to HomeAdvisor.com.
- Declutter and remove personal items. Remove clutter, family photos, knickknacks and other personal items so buyers can truly see themselves living in the home.
- Keep colors neutral and floors clean. A fresh coat of neutral paint and professionally cleaned carpets and floors will go a long way with buyers for a minimal cost.
7. Market your home with virtual tours, professional photos
Given the precautions needed to curb the spread of COVID-19, marketing your home with professional photos and virtual tours is more important than ever. Since the start of the pandemic, buyers are using virtual home tours to narrow down the homes they want to see in person.
Declutter and stage your home in advance so you or your real estate agent can arrange for professional photos and videos. Spend the money on professionally created visual elements to show your home at its best and make a great first impression online.
8. Make a plan for handling showings
Since the start of the pandemic, many sellers are forgoing open houses and only showing their homes by appointment. NAR recommends considering only showing your home to buyers with preapproval letters to limit in-person showings to serious buyers.
Consider your comfort level with the number of people in your home at one time and how many showings you prefer in a day, and communicate your preferences to your agent. For example, you can request that no one touch any surfaces in and around the property and only two people, plus an agent, view the property at once.
On showing day, take the time to make your home inviting. Get rid of clutter, turn on the lights and tidy up your front lawn. When you’re out of the house during showings, keep your phone handy to answer any questions.
9. Evaluate and negotiate offers
If your home is priced and staged right, the offers should start coming in. When you receive an offer, you’ll have the option to accept it as-is, send back a counteroffer or reject the offer and move on. A counteroffer is a seller’s response to the buyer’s offer that requests changes to the original offer — usually to the price, timeline or contingency terms. All offers should be submitted in writing by set deadlines written into the contracts.
Your real estate agent’s experience and negotiating skills will be instrumental as you review offers, so listen carefully to their advice.
10. Tally up your seller closing costs
Seller closing costs generally range from 2% to 6% of the loan amount. While many of the costs can be taken out of the proceeds of the sale, it’s best to know what to expect. Typical seller closing costs include:
- Real estate attorney fees. Some states require an attorney to be present at closing. Attorneys typically charge an hourly rate of $150 to $350.
- Real estate transfer taxes. These vary by location, and you may have both state and local taxes. Your agent can let you know what to expect.
- Real estate commissions. Sellers are typically responsible for both the buyer’s and seller’s agent commissions. These are typically 5% to 6% of the sales price.
- Mortgage payoff. Some lenders charge a prepayment penalty fee if you pay off your mortgage within a certain time frame. Contact your lender to find out whether this applies to you.
11. Close on your home sale
Once the offer is accepted, the focus will be on getting to the closing table. Here are key action items for sellers:
- Get repairs done quickly. If you’ve agreed to certain repairs before closing, get them done promptly, and make sure you keep receipts and paid invoices to prove they were completed.
- Prepare for the walk-through. Buyers will do a final check to make sure there are no new issues in the home, and that you’ve made the agreed-upon repairs. Make sure all of your belongings have been removed from the home and you leave it in a move-in ready condition.
- Review closing documents. Check your final documents for any errors in the address, your name’s spelling or your property’s legal description. If the buyer is getting a mortgage, review the closing disclosure to ensure you’re only covering the credits and costs you agreed to.
- Provide keys and other home-related items to the buyer. Gather all house keys, garage door openers, home appliance/system manuals (if you have them) and other items a buyer will need to access and move into the home.
5 mistakes to avoid when selling your home
It’s easy to make mistakes when selling a home, especially if this is your first time. Here are five mistakes to avoid:
- Setting too high a sales price. While the low inventory and high sales prices might be tempting, set a price that makes sense based on how comparable properties in your area are selling.
- Not leaving enough time to prep your home. Think about how long you expect it to take to get your home ready to sell, then add more time. Decluttering, cleaning, staging and prepping for showings will all take more time than you’d expect.
- Not disclosing issues. It’s best to be upfront, which is one of the reasons you complete a seller disclosure form. If issues come up in your pre-sale inspection, either resolve those issues or disclose them. There could be legal consequences if issues are discovered after the sale.
- Getting emotional about the sales process. The offers that come in may not be what you’d expect. A promising sale might fall through. Keep your eye on the end goal and try not to let the process frustrate you. Your real estate agent can help guide you through the process, which is another reason why it’s best to hire one.
- Not accommodating potential buyers. It’s challenging to pack up your family, including pets, and leave your home for showings. Since open houses aren’t realistic in many areas, showing appointments are going to be the main way potential buyers see your home. Do your best to be flexible while maintaining your standards around COVID-19 precautions.