Monkey Conveyancing Selling Guide
The first thing you want to do is to find out what your home is worth.
Call up a couple of local Real Estate Agents and get them to come around to give you an estimate.
They may give you ideas on how to improve the property or make some changes to get the best price for it.
How Much Is The Property Worth?
That depends on what it is, where it is, how old it is, what needs to be done to it, what Buyers are looking for, how much they are prepared to pay, what homes in the area are on the market for and what they have sold for.
In reality, your home is only worth what someone is willing to pay for it. You may want more than you are offered and more than your Real Estate Agent’s estimate, but at the end of the day it is only worth what you and the Buyer agree it is worth.
Selling is all about getting the best price. Most of us are very attached to our homes and the memories that go with it. This makes it very hard not to place a value on your home based on this emotional attachment.
But in reality, it is just a piece of land with a building on it. If you’re lucky, someone may fall in love with it and pay more for it and this is why the presentation of your home at inspection time is so very important.
Listen to your Real Estate Agent! They know what makes a place sell and what people are looking for. They usually have a list of people who have been looking and they will approach the people on this list first before your home is advertised. Real Estate Agents usually have a weekly email newsletter they send out to their Buyers before the home goes “public” online.
You can also ask an independent land valuer to give you an estimate on your property.
Consider going to several local auctions to get an idea of who is looking to buy in your area. Are they young marrieds, retirees, middle-aged with no kids, a single person? This will help you decide how to present your property to attract the most suitable buyers.
Which Real Estate Agent Do You Go With?
Always choose a local Real Estate Agent. They will have their finger on the pulse and know what is and what isn’t selling and the reasons why. A Real Estate Agent must be able to talk from their experience about what is happening.
Go for a drive around your suburb and see which estate Real Estate Agents have the most signs up selling property. That isn’t always indicative of the best Real Estate Agent, but it will tell you who is most likely to have the best idea of what is happening.
Ask your friends and neighbours about their experience with any Real Estate Agents and who they would recommend.
Ask a local Real Estate Agent for a Comparative Market Analysis that shows sales in the last 6 months in your area. The Real Estate Agent will be able to tell you the back-story on home sales in your area and therefore can explain the statistics to help you get the real picture.
Find out how well the Real Estate Agent can negotiate. Ask them what they think your property is worth. If they have a Comparative Market Analysis they should be able to confidently give you a high and low price for your home. Be wary if they want you to give them a value. That is what you are paying them for! Ask to see some of the internet and print based advertising. Does the Real Estate Agent use terms such as, “Owner already bought elsewhere, Must Sell” or “Owner willing to consider all offers”? Terms such as these make it sound like you are desperate to sell. To accept a lower price on your property in exchange for a faster sales contract, might be appropriate, but playing all your cards before evaluating the interest in your property is likely to attract the bargain seeker who throws out low offers, effectively wasting your time.
Ask the Real Estate Agent for a Marketing Plan. The internet is the best way to advertise your property these days but it may also be relevant to consider magazines, newspapers, and direct mail advertising, depending on the property and the selling strategy. And find out what the selling strategy is, including an open home inspection schedule. The strategy is the most important thing.
Does the Real Estate Agent use a professional photographer? The photos have to look GREAT whether they are online or in print. One bad picture and potential Buyers could just click away and not even read your ad.
Ask your Real Estate Agent for references for the properties they have sold in the last 3-4 months. How successful have they been at selling? What is the ratio of their listings to sales?
You must have confidence in the Real Estate Agent. You need to be able to trust them, get along well with them, be able to talk to them and believe they are working in your best interest.
The Real Estate Agent will do what needs to be done to sell your home – that is their job. You might not like what they tell you about how much it is worth – the test of its worth only happens when you start getting offers.
In Queensland (Qld), a Real Estate Agent cannot act for a client until appointed in writing by the client. As the Seller, you must complete PAMD Form 22a – Appointment of Real Estate Agent (Sales and Purchase).The Real Estate Agent will have the forms. All Real Estate agents must be licensed to work in Qld. They should display their licence prominently in their office.
How Much Will The Real Estate Agent Cost You?
You will have to negotiate a price with the Real Estate Agent for them to sell your home as well as the length of time that they will be your Real Estate Agent. You need to determine how flexible they will be on their fees. If they cave in too quickly during your negotiations they could be desperate to secure your business or they simply do not know how to negotiate well enough. They should be comfortable answering contract questions such as:
What happens if I am not happy with the services being provided?
Is there a cancellation clause?
Are there any penalties for withdrawing early?
The fee is usually a percentage of the sale price (plus GST– watch out for that extra 10% of what you are paying).
Advertising costs are usually included but in the fee but if the home doesn’t sell you may still have to pay theses advertising costs. With the low cost of advertising online at sites such as domain.com and realestate.com.au, advertising costs are a fraction of what they used to be.
Some Real Estate Agents may charge a flat fee but for that they won’t show a Buyer the property – you will have to take people through yourself. The Real Estate Agent will only place the advertising and set up appointments for Buyers to come through. If you’re lucky, they might get involved in negotiating the price when a Buyer makes an offer. But almost all Real Estate Agents want to manage the transaction from start to finish and will expect a payment that is called their “commission”.
REMEMBER: you get what you pay for. Going with the cheapest price isn’t always in your best interest. You may not need the Mercedes Benz but you probably don’t need the Barina either. Your property is your greatest asset – protect it by paying for good people to look after your interests. By selling through an experienced Real Estate Agent you are getting someone who knows what they are talking about and who will get you the best price. Don’t cheat yourself on cost only to get less than what you might have gotten by using a shrewd Real Estate Agent.
Agents buy and sell homes everyday – how often do you?
Getting the Place Ready to Get the Best Price
Take advice – listen to what the Real Estate Agent says about what you need to do to the home to get the best price.
Giving the market what it wants – TV is chock-a-block with home renovation shows. This has to say something about how informed Sellers and Buyers are now. The standard has been raised.
Today’s Buyer. You will most likely be that person after you sell. Try to put yourself in their position when you look at your home. Make it as presentable as you can – lots of fresh air and light, cleanliness, space, modern colours and tasteful arrangements.
Making your home presentable may mean minor or major renovations to be able to sell it for more. New kitchens, bathrooms and the number of bedrooms are the factors that sell a home first.
Sometimes a home may sell because it needs a new kitchen or bathroom and the Buyer can renovate it and make a few dollars.
Sometimes you can do part of the renovation and leave part for the next person. This way everyone makes money.
It is possible to sell your home with council approved plans for an extension or renovation. Doing the “leg work” effectively making it easier for the next person.
In some cases the Buyer wants a completely renovated home. There’s good money to be made in renovations if done properly – a deck, landscaping, or an extra bedroom. These changes can deliver big bucks in sought after areas.
Of course, there are factors that you have no control over such as location, or worst home in the best street, proximity to transport and shops, which aspect the home faces, views, and whatever else a Buyer needs to have. The list is endless.
Budget. Look at what any renovations will cost in time and money. You will then need to determine if the time and money is worth any extra you get when selling your home. Don’t forget to include in your calculations any costs of holding onto the home while the work is done e.g. mortgage payments, rates, insurance and if the housing market is rising or falling.
Fix any problems first. Your home will sell faster with less hassle (i.e. with less price bargaining and delay) if you do all the repairs and maintenance before the place goes on the market e.g. fix cracks in the walls and ceilings, touch up paint work, have the carpets professionally cleaned and replace rusted guttering. A Buyer will use the excuse of repairs and maintenance to negotiate a lower price. You might not want to do the work so make that decision and be willing to sell for less when the negotiations start. Sometimes the home may be a “renovator’s delight” and that is a different situation.
Presentation. If you want the best dollar for your property, the home has to look its best. Remove any dead plants, prune the rest, and mow the lawn. A home that looks like it has been loved and looked after will have a more comfortable feel than a dirty one. One of our clients even tidied up his neighbour’s front lawn and another planted trees in the street (although you may need to get the Council’s approval to do this as they own that land). Doing these things makes a difference.
Home Staging. This is a fairly new concept in Australia. It means getting a professional into your home who specializes in “window dressing” your home to give it “the look” that best suits it. This might mean rearranging the furniture, adding some rented furniture, or removing some of yours to give it the “feel” that makes a Buyer comfortable and want to purchase the property. These professionals make the homes in magazines like Home and Garden look good. They may not be able to make a silk purse out of a sow’s ear but they’ll give it a go.
Another thing to consider is if you have pets, ensure there are no nasty odours lingering in your home when it comes to open for inspection time. Take your pets out of the home during inspections and ensure you remove kitty litter trays, dog beds, dog toys and food bowls etc.
Are There any Legal Issues You Have to Deal With at This Time?
Setting Your Terms of Sale
When you sign the Contract with the Buyer to sell your home you will be guaranteeing certain things about the property. If you haven’t investigated what you are guaranteeing and the Buyer finds out that the guarantees are false, you could be in big trouble legally. It’s better to sort these issues out before you find a Buyer otherwise you could lose any potential Buyers who don’t want to wait around until the problems are sorted out. Be honest with your Real Estate Agent up front about the property. They are on your side. The more they know, the easier it makes the Real Estate Agent’s job and that means not having to put out fires that they can’t see coming. So what exactly are you guaranteeing?
Compliance: The property has to comply with certain building, town planning and environmental laws. If a potential Buyer finds out that you haven’t complied, then there will mostly like be an issue for you as the Seller e.g. you have converted the space under your home into a commercial space and have rented it out but you didn’t get approval to run a commercial enterprise in an area zoned residential. OR you have installed a second kitchen and you are renting out a separate part of the home.
Outstanding Notices or Orders: When you sign the Contract with the Buyer, you are guaranteeing that the property is not subject to any Notices or Orders from any Government Departments e.g. land resumption for road widening, or it has a health defect notice.
Illegal Building Work: Has there been illegal building work e.g. a deck or a granny flat? This could mean there will be a building or engineering safety compliance issue.
Boundaries: Be sure that the fences are in the right place and that they correctly mark out the boundary. We have seen too many cases where a Buyer thought they were buying a larger piece of land than they were, and this has led to cancelled contacts or the Seller losing up to 5% of the purchase price in a compensation claim. For these reasons, you don’t want to be locked into a contract to buy another property and then realise you do not have enough funds to cover your purchase so that you breach the Contract and lose your deposit. Or you could find that you do not have enough money to pay off the mortgage on the home you are selling. The downside is that you won’t be able to finish the sale and could be sued for damages for breach of contract.
Encroachments: You need to be sure that a neighbour’s building (including any fences) is not on your property or that part of your building(s) is not on your neighbour’s.
Swimming Pools: In Queensland you should have a Pool Safety Certificate. In NSW you need to have the pool approved by the Council.
Do You Need A Contract for Sale?
Different States have different laws.
Queensland: Your Real Estate Agent will prepare the Contact when an offer on your home is received. Queensland Contracts for Sale tend to be “stock standard” with little to no changes being made by the Real Estate Agent to the standard printed form. This creates a level playing field that is fair for everyone which was the intention of the Industry Bodies that drafted the Contract. The Real Estate Agent will put into the Contract that the terms of sale after the agreement to sell have been negotiated. These are usually to do with finance, building and pest approval, the Settlement terms and other items such as getting a pool safety certificate or certain work being done on the property. If there are any issues with the guarantees referred to in the previous section you may need a Conveyancer.
New South Wales: You cannot list a property for sale unless you have a Contract for Sale ready for inspection at the point of sale which almost always means the Real Estate Agent’s office. Your Conveyancer will prepare the Contract.
Victoria: You cannot sell your property without a Vendor’s Statement, so you will need a Conveyancer to prepare one. They will also prepare the Contract of Sale.
If you are in NSW or Victoria, you will need a Conveyancer at this stage. In Qld, you may or may not.
Now You Are Ready to Put Your Home On The Market!
Your Real Estate Agent will put together a selling plan based on their experience and what is happening in the market. A price will be set and a strategy put in place to adjust the price periodically until an offer is received.
Never Sign Legal Paperwork regarding your real estate without getting legal advice first.
While this stage may be new to you, it doesn’t have to be overwhelming, daunting or something to fear, in spite of the horror stories that you may hear.
Conveyancing is not rocket science and Monkey is here to tell you that it is nothing to be afraid of. However, sometimes as Conveyancers we do not have control over matters that are out of our hands – particularly when dealing with 3rd party institutions and this is where things can sometimes go wrong.
Two rules will make the selling process simpler and hopefully save you some grave heartache.
RULE 1: NEVER SIGN LEGAL PAPERWORK REGARDING YOUR REAL ESTATE WITHOUT GETTING LEGAL ADVICE FIRST.
The law is very unforgiving when it comes to signing legal papers and especially regarding real estate. Ownership of land is one of the most important basics that our society is built on and the right of land ownership is one of the most protected.
This gives rise to Rule 2:
RULE 2: NEVER SIGN LEGAL PAPERWORK REGARDING YOUR REAL ESTATE WITHOUT GETTING LEGAL ADVICE FIRST.
Yes, Rule 1 and Rule 2 are the same, but this is singlehandedly the most important piece of advice when it comes to conveyancing!
Getting legal advice early is a good idea because there are things that have to be done in the conveyancing process that take time and you won’t know what these time frames are – there is too many variables in the process. There have been enough cases where the client made their own plans only to later find that they have painted themselves into a dangerous corner because they weren’t aware that there were other facts that had to be considered. Dangerous because they had agreed to things that couldn’t be done, without a lot of stress and cost, in the time frame they had allowed.
4 – 6 weeks leading up to the move
Start getting quotes from removalist companies. Give them a date for moving so they can give you a quote (the date is not set in stone at this point). Quotes can vary by thousands of dollars. Don’t always go with the cheapest. Go with the company you feel most comfortable with. Reputable firms that have been in operation for many years will, in most cases, be your best choice.
Book the Removalist once you have your Settlement date. Start collecting (or buying) boxes for packing. The removalist company you are using should be able to supply you with boxes. Ensure you buy some heavy duty tape as well. Many removalists will also offer packing as a service so you do not have to do any of it yourself.
Label the boxes by the rooms that they should be delivered in to.
List the contents on each of the boxes and number the boxes. It will be bedlam when the boxes are delivered and it could be days before you realise you have a box missing.
Some things can be packed weeks in advance e.g. if it is summer, pack all your winter clothes. You can pack all your linen, Manchester, your library and study, garage, workshop, your sporting equipment and your good china.
BUT before you pack anything, have a good clean out and garage sale if you need to. Dispose of things you will never use again, especially clothes and those “I might use that one day” items.
Clean everything before you pack it. You don’t want to be taking dirty dusty things into a clean new place.
Take time off work on moving day. You are going to want to supervise the move and be there for the last minute things that can’t get packed until the morning of settlement – like breakfast dishes and food.
Check your insurance policy about loss and damage when moving. Home contents insurance is usually part of the insurance on the home. Be careful not to cancel the home insurance until the day after the move i.e. Settlement date. It’s a good idea not to cancel the policy until after Settlement has occurred rather than calling the insurance company in advance and cancelling it from the Settlement date – what if Settlement is delayed? You’ll have no insurance to move.
If you are moving into or out of an apartment, book a moving time with the building manager to arrange access for the moving truck and the lift.
Organise a cleaning company to come in on moving day. You will not have time to clean the home after the movers leave. You will be going to the new address. Usually the cost of hiring a professional cleaner outweighs the time and trouble it would take for you to do it yourself. In addition, they have appropriate equipment and are aware of real estate standards that you might overlook (e.g. wiping skirting).
If you like, you can prepare an information pack for the new residents of your old home. Include details such as how to use equipment, manuals for the appliances, local information such as which days to take out the rubbish and recycling bins. If you are so inclined, you might leave a bunch of flowers (in water) or a bottle of wine with a welcoming card.
If you are buying a new home, you should have already arranged insurance to cover the new home and property effective from the date of exchange of Contracts. If you will be renting, ensure you arrange any necessary insurances you may need.
3 weeks before moving
Somewhere in the last few weeks before your home starts looking like an evacuation centre, you might like to mark the occasion of your leaving. Perhaps a dinner party for your family or close friends to remember your life there and be grateful for what the home gave you. Leaving your home can be a very emotional experience. You’re leaving something behind that you will never see or experience again. Your home was part of you. If you don’t get some closure it is not uncommon to be depressed afterwards and not know why. Saying goodbye to your home is an important ritual. Being grateful for what you had is always an important acknowledgement.
Arrange to have utilities disconnected at your old home and connected at your new home so you have electricity, phone and internet when you arrive.
Cancel any newspaper subscriptions in your old home.
Organise to have your mail redirected by Australia Post to go into effect on moving day. This is your safety net. You’ll be surprised who writes to you and who doesn’t know about your new address – including parking fines, missed tolls, offers, opportunities and long lost friends. Often even after you’ve told others about an address change, there’ll be departments in the organisation whose data bases have not been updated and things “just go wrong” at some places.
Start to notify people, organistions and institutions of the change of address – much can be done online and Australia Post has a free service. These people would include:
Anywhere you have money deposited e.g. bank, credit unions, companies you have shares in, your stockbroker.
Anyone who owes you money e.g. your employer, superannuation fund, your debtors.
Anyone you owe money to e.g. bank, credit union, private lenders, credit card companies, hire purchase or lay by companies, places where you have store accounts e.g. David Jones’, Myers, rental companies, or any other place that you hold a plastic membership card to.
A company you have insurance with e.g. car, home, medical, life, disability, glass, landlord-tenancy.
A government department you have dealings with e.g. motor registry (car registrations and driver’s license), tax office, electoral roll, social security, work cover, road toll company etc.
Someone from whom you receive goods or services e.g. electricity, gas, water, telephone, mail, newspapers, child minding services, doctor, dentist, vet, solicitor, accountant, meals on wheels, Salvation Army, St Vincent de Paul, subscription services (like magazines), video hire store etc.
An organisation you belong to e.g. trade union, professional body, gym, NRMA, RACV etc.
Your family and friends, especially overseas people, people on your Christmas card list.
Start using up the food in your freezer, fridge, and pantry to reduce waste when you begin moving home.
Draw up a floor plan of your new home and decide where you will place all your main furnishings. If you’re paying a removalist by the hour, you might as well make sure they put everything in the right place so you won’t have to move it again later.
Protect delicate items during transportation by wrapping them in tissue/butcher’s paper (avoid newspaper as it can leave ink marks). Use large boxes for light objects and small boxes for heavy ones so you are able to manage them once they’re full.
Anticipate that the new owners will change the locks but you will still need to leave all your keys with the Real Estate Agent so that the new owners can get into the home after settlement.
Pack the kitchen last. It will take the longest but it is the room you use the most. Some things you will want to carry in your car – fragile and precious things. Make sure you have room for them in the car.
Last Minute Tasks
In the days leading up to moving, eat out or keep meals basic. This will allow you to pack up most, if not all, of your kitchenware.
If you have children, arrange for them to stay with a relative or friend on moving day. If you have pets, organise some boarding for them. You don’t want either getting under foot or aggravating you or them freaking out.
Check the weather forecast for your moving day. If it looks like it will be wet, purchase some tarps to protect your furniture as it moves between home and truck.
Separate all the items you will require immediately after the move, such as bed sheets, towels, toiletries, work/school clothes, toilet paper and pet food.
Make sure you have something to sustain you through the day. Pack a kettle, some cups, cutlery, tea/coffee and some snacks in a separate box for easy access when you need a break.
Make sure documents are easy to access in case you need them during or after moving home.
Consider storing valuables in a security deposit box at the bank until you have finished moving. Otherwise, keep them close to you as it is easy to lose track of things during the chaos of relocation. Depending on the items, you may want to look into whether these are covered by your contents insurance.
The day before moving home, defrost and clean your fridge out so water doesn’t spill out when you’re transporting it.
Backup all important files on your computer and give it to a friend for safe-keeping until you have safely transported the unit.
On The Day
Wake up early, shower and dress, eat, wash the dishes, strip your bed and pack your toiletries so when the removalists arrive you have nothing left to do.
Place all heavy boxes at the front of the home. Removalists generally like to put these in the truck first so it will speed the whole moving process up – something you definitely want to aim for if you’re paying by the hour.
Put padding around any areas which are difficult to manoeuvre in both your old and new homes to avoid any dents and scratches to walls as the removalists shift bulky belongings.
Check items off your moving home checklist as they go onto the moving truck and later on as they come off it to ensure you haven’t left anything behind.
Do a walk-through and double-check everything before you leave, including all storage areas such as cupboards and drawers.
Turn off the power at the switchboard.
Check all doors and windows are locked.
At your destination use the floor plan you created a couple of weeks ago to guide the removalists in placing your furniture and possessions.
Change all the locks at the new property.