Selling a home is often imagined as a smooth and effortless process, where one simply lists the property, finds a qualified buyer, and hands over the keys for a quick and hassle-free transaction. Unfortunately, the reality is much more complex. There are numerous variables at play, some of which are within your control, while others are not.
For instance, the location of your home can impact how long it takes to sell or how much you can ask for it. In areas where demand is high and inventory is low, you’re likely to attract buyers more easily and secure a better price. Conversely, in regions where the housing market has cooled, you’ll need to work harder to attract the right buyer.
Since the peak of the pandemic, the real estate market has undergone significant changes. The days of frantic bidding wars are mostly over, and while prices and mortgage rates remain elevated, there are fears of a looming recession that have caused some buyers to hold off on purchasing until prices or rates (or both) drop.
So, as a seller, you want to be prepared and control whatever factors you’re able to. Things like hiring a great real estate agent and maximizing your home’s online appeal can translate into a more seamless closing — and more money in the bank.
10 steps to sell your house in 2023:
1. Set a timeline to sell your house
Selling a house is a major undertaking that can take several months from start to finish — or much longer, depending on local market conditions and the level of inventory available.
As soon as you decide to sell your house, jump right into researching real estate agents to find someone with the right experience for your situation (see Step 2). But don’t stop there.
At least two or three months before you plan to list, consider getting a pre-sale home inspection. This is optional but can be useful to identify any problem areas, especially if you suspect structural or mechanical issues that might need addressing to facilitate a sale. Your agent can also help you figure out what does or doesn’t need fixing. Leave enough time to schedule necessary repairs.
About a month before listing your house, start working on staging and deep cleaning in preparation for taking listing photos. Keep clutter to a minimum, and consider moving excess items to a storage unit to show your home in its best light.
2. Hire an agent who knows the market
The internet makes it easy to delve into a real estate agent’s professional history and experience, helping you choose the right person to work with. Look up agents’ online profiles to learn how long they’ve been in the industry, how many sales they’ve closed and what designations they may have earned. Pay attention to how and where they market their listings, and whether or not they use professional photos.
“Any designation they’ve earned is a huge plus, because it’s a sign they’ve taken the time to learn about a particular niche,” says Jorge Guerra, president and CEO of Real Estate Sales Force and a former global liaison for the National Association of Realtors (NAR).
Some homeowners might be tempted to save on paying a commission and instead sell their home themselves, without an agent. This is known as “for sale by owner,” or FSBO. The amount sellers stand to save on those fees can be thousands of dollars, usually 5 percent or 6 percent of the total sale price.
However, an experienced agent does a lot to earn their fee. For example, they can expose your house to the broadest audience and negotiate on your behalf to garner the best offers possible. If you go it alone, you’ll have to personally manage prepping your home, marketing it, reviewing buyers’ offers and handling all the negotiations and closing details.
When working with an agent, keep in mind that real estate commissions are often negotiable. As a result, you might be able to get a break at the closing table.
3. Determine what to upgrade — and what not to
If you’re going to spend money on costly upgrades, make sure the changes you make have a high return on investment. It doesn’t make sense to install new granite countertops, for example, if you only stand to break even on them — or even lose money. Plus, these improvements may not be necessary to sell your house for top dollar, particularly if inventory levels are low in your area. Here’s where a good real estate agent can help guide you: Agents know what people expect in your area and can help you plan upgrades accordingly.
In general, updates to the kitchen and bathrooms provide the highest return on investment. If you have old cabinetry, you might be able to simply replace the doors and hardware for an updated look without breaking the bank. A fresh coat of neutral paint and a spruced-up landscape are typically low-cost ways to make a great first impression.
In addition, while a pre-sale home inspection is optional, it can be a wise upfront investment — especially in an older home. For a few hundred dollars, you’ll get a detailed inspection report that identifies any major problems. This alerts you in advance of issues that buyers will likely flag when they do their own inspection later in the process.
By being a few steps ahead of the buyer, you might be able to speed up the selling process by doing repairs in tandem with other home-prep work. This means by the time your house hits the market, it should be ready to sell, drama-free and quickly.
4. Get professional photos
Work with your real estate agent to schedule a photographer to capture marketing photos of your home. With the ubiquity of online house-hunting these days, high-quality photos are critical. Nearly all homebuyers look at online listings — 96 percent, according to NAR. Maximizing your home’s online appeal can make all the difference between a quick sale or a listing that languishes.
Some agents build professional photography and virtual online tours into their suite of services. You can also seek out a photographer on your own. The fee for professional photography will vary based on the size of your home, its location and how long it takes to shoot the property.
A professional photographer with a strong portfolio knows how to make rooms appear bigger, brighter and more attractive. The same goes for your lawn and outdoor areas. Bad online photos can turn off homebuyers before they even have a chance to read about the lovely bike path nearby or the new roof you just installed, so well-taken photos can really pay off.
5. Set a realistic price
Even in competitive markets, buyers don’t want to pay more than they have to, so it’s crucial to get the pricing right. Going too high can backfire, while underestimating a home’s value might cause you to leave money on the table.
To price your home perfectly from the start, consult the area comps. This information about recently sold properties in your neighborhood, and specifically properties similar to yours, give you an idea of what comparable homes around you are selling for, thus giving you an idea of how much you might reasonably ask.
“A frequent mistake sellers make is pricing a home too high and then lowering it periodically,” Lopez says. “Some sellers think this practice will yield the highest return. But in reality, the opposite is often true. Homes that are priced too high will turn off potential buyers, who may not even consider looking at the property.”
In addition, homes with multiple price reductions may give buyers the impression there’s something wrong with a home’s condition, or that it’s somehow undesirable. So it’s best to eliminate the need for multiple reductions by pricing your home to attract the widest pool of buyers from the start.
6. List your house on the market
This step will likely involve your real estate agent registering the listing with the local MLS (multiple listing service). Here are some tips to get your home market-ready:
- Focus on the home’s online appeal: You’ve probably heard of curb appeal, but professionals say online appeal is now even more important. “Your home’s first showing is online,” Guerra says. “The quality of your web presentation will determine whether someone calls and makes an appointment or clicks on the next listing.”
- Stage it and keep it clean for showings: Staging a home simply means removing excess furniture, personal belongings and unsightly items from the home while it’s on the market, and arranging rooms for optimal flow and purpose. If you’re in a slower market or selling a luxury home, investing in a professional stager could help you stand out. Nationally, professional home staging costs an average of around $1,766, according to HomeAdvisor, but prices range between about $770 and $2,863.
- Clear out for showings: Make yourself scarce when potential buyers come to view your home. Let them imagine themselves in the space, free from the distraction of meeting and talking to you. “Seeing the current homeowner lurking can cause buyers to be hesitant to express their opinions,” says Grant Lopez, Realtor at Keller Williams Heritage and former chairman of the San Antonio Board of Realtors in Texas. “It could keep them from really considering your home as an option.” Generally, buyers are accompanied by their own real estate agent to view your home. You can also ask your own agent to be present at showings.
7. Review and negotiate offers
After your home officially hits the market and buyers have seen it, the offers will ideally start rolling in. This is where a real estate agent (or attorney) is your best advocate and go-to source for advice. If your local market favors sellers, buyers will likely offer at or above asking price. On the other hand, if sales are slow in your area, you may have to be open to negotiating.
When you receive an offer, you have a few choices: accept it as it is, make a counter-offer or reject the offer. A counter-offer is a response to an offer in which you negotiate on terms and/or price. Counter-offers should always be made in writing and provide a short timeframe (ideally 48 hours or less) for the buyer to respond. You can offer a credit for paint and carpet, but insist on keeping your original asking price in place, for example. Or, you might offer to leave certain items behind to sweeten the deal.
If you’re lucky enough to get multiple offers, you might be tempted to simply go with the highest bid. But look closely at other aspects of the offer too, such as:
- Form of payment (cash vs. financing)
- Type of financing
- Down payment amount
- Concession requests
- Proposed closing date
Be mindful that if a buyer is relying on lender financing, the property has to be appraised. Any shortfall between the purchase price and appraised value will have to be made up somewhere or the deal could fall apart.
8. Weigh closing costs and tax implications
In any real estate transaction, both the buyer and seller must pay at least some closing costs. The home seller typically pays the real estate agents’ commissions, which usually total around 5 percent to 6 percent of the home’s sale price.
Some other closing costs commonly paid by the seller include:
- Government transfer tax
- Recording fees
- Outstanding liens
- Attorney fees
Additionally, if the buyer has negotiated any credits to be paid at closing — repairs, for example — the seller will pay those too. Your real estate agent or the closing agent should provide you with a complete list of costs you’ll be responsible for at the closing table.
The good news is that you may not owe taxes on your profits from the sale. It depends on whether it was your primary residence and how much you make on the sale. If you’ve owned and lived in your home for at least two out of the previous five years before selling it, then you will not have to pay taxes on any profit up to $250,000. For married couples, the amount you can exclude from taxes increases to $500,000. If your profit from the home sale is greater than that, though, you’ll need to report it to the IRS as a capital gain.
9. Consider hiring a real estate attorney
Some states actually require sellers to have a real estate attorney to close on a home sale, but many don’t. Regardless of your state’s rule, the expense is worth it to protect such a large financial transaction. It may cost you a couple thousand dollars, but there’s a lot more money than that at stake, and it can never hurt to have a legal expert give everything the OK.
In addition, an attorney can help fill out paperwork correctly, review contracts and documents, identify potential issues and ensure the sale goes as smoothly as possible. An attorney would also be able to spot title issues that could hold up your sale for weeks or months — or even torpedo the deal — such as:
- Outstanding liens or judgments or other encumbrances
- Trust issues
- Mortgage balances
- Tax issues
10. Gather paperwork and close
Lots of paperwork is needed to properly document a home sale, so keep it organized all in one place to help things go more quickly. Your agent can help you make sure you’ve got everything you need. Some of the main documents you’ll need to compile include:
- Original purchase contract
- Property survey, certificate of occupancy and certificates of compliance with local codes
- Mortgage documents
- Tax records
- Appraisal from your home purchase
- Homeowners insurance
- Home inspection report, if you had one
Finally, bring all that paperwork — plus payment of any fees and the keys to give the new owners — to the closing. Once everything is signed and handed over, your house is sold!
To sell your house, it requires a lot of work and can be quite complicated. Following along with this 10-step guide — and having a trustworthy real estate professional by your side — can help you successfully navigate the process.